A Look At The New Health Insurance Law
The Law on Health Insurance, passed by the National Assembly on November 14, 2008, will take effect next July 1.
Applicable to all domestic and foreign individuals and organisations, the law will govern eligibility and the scope of health insurance coverage, health insurance funding, rights and obligations of insurers and insured, and a road map for universal health insurance.
From the point-of-view of enterprises, the new law will have a considerable impact, as they will be obligated between now and 2014 to provide health insurance coverage to all employees working under indefinite-term labour contracts or labour contracts with a definite term of three full months or more, as well as enterprise managers receiving wages. An employee’s maternity leave remains to be included into his/her continuous period of health insurance payment eligible for such insurance regime enjoyment, although during this time the employee and the employer do not have to pay insurance premium.
Article 13, Clause 1, of the law would provide for a premium level of up to 6 per cent of the employee’s monthly wage, of which the employer is obligated to pay two-thirds and the employee one-third.
For employees working under multiple labour contracts, the health insurance premium will be based on the labour contract with the highest wage level. However, in no case will the maximum base wage used to calculate insurance premiums exceed 20 times the minimum wage.
As under current regulations, the employer will pay premiums monthly to the health insurance fund on behalf of the employee, deducting the amount submitted for the employee’s contribution from his/her wage. (The period can be expanded to every three or six months for enterprises in agriculture, forestry, fisheries and salt-making which pay wages on a seasonal rather than monthly basis.)
Under the new law, health insurance participants have the right to be granted a health insurance card, choose their initial examination and treatment provider, receive examination and treatment, receive reimbursement for costs of examination and treatment from a health insurance organisation in accordance with the health insurance regime, request and receive information about the health insurance regime, and make claims and denunciations against breaches of the law on health insurance.
Participants in the health insurance system also have the obligation to fully and timely submit health insurance premiums, use their health insurance card for proper purposes and not lend them to others, comply with health insurance regulations, and pay those healthcare costs not lawfully covered by the health insurance fund.
The organisations and individuals submitting health insurance premiums have the responsibility to prepare the application file for granting a health insurance card and deliver the card to the participant, to fully and timely submit premiums, and maintain full and accurate records related to the payment of health insurance premiums.
The law also acknowledges a role for labour unions, trade associations and other groups that represent either employees or employers in ensuring the enforcement of rights and obligations under the health insurance law.
To settle disputes that may arise under the new law, e.g., disputes arising out of employee or employer rights or obligations under the law, or disputes involving health insurance organisations and healthcare providers, the parties are obligated to seek conciliation. If the conciliation fails, either party will reserve the right to take the matter to court.
In addition to advancing the noble objective of universal health insurance and supplying detailed health insurance regulations, the new law also poses a challenge to enterprises, who face a sudden increase in labour costs at a time of economic difficulty. This could cause enterprises to reconsider their human resource needs and lead to layoffs. It also remains to be seen whether the increased premium levels required under the law will eliminate the risk of insolvency of the health insurance fund.