What is the use of the health insurance fund in Vietnam?

What is the use of the health insurance fund in Vietnam? (Internet image)

1. What is the health insurance fund?

According to Clause 3, Article 2 of the Law on Health Insurance 2008, health insurance fund means a financial facility set up from health insurance premium payments and other lawful collections, which is used to cover costs of medical care for the insured, managerial costs of health insurance institutions and other lawful costs related to health insurance.

2. Sources for setting up the health insurance fund in Vietnam

Sources for setting up the health insurance fund include:

- Health insurance premiums prescribed in this Law.

- Profits from investments by the fund.

- Financial aid from domestic and foreign organizations.

- Other lawful revenues.

(Article 33 of the Law on Health Insurance 2008

3. Health insurance fund management expenses in Vietnam

Health insurance fund management expenses include:

- Expenses for operating the apparatus of social insurance agencies at all levels;

- Spending on propaganda and dissemination of policies and laws; development and management of participants; professional training and retraining; procedural reform; collection organization; inspect, examine and pay other expenses in accordance with the law on health insurance;

- Expenses for information technology application and development investment.

4. Distribution and use of the health insurance fund in Vietnam

Total health insurance contribution amount prescribed in Article 7 hereof shall be distributed and utilized as follows:

(1) 90% of such amount intended for medical services (hereinafter referred to as medical service fund) shall be used for the following purposes:

- Paying costs in the list of health insurance-covered costs of a health insurance policyholder as prescribed in Article 14, 26, 27 and 30 of Decree 146/2018/ND-CP;

- Setting aside a part of such amount given to educational institutions or vocational training establishments, entities, organizations or enterprises satisfying prescribed requirements in accordance with clause 1 of Article 34 of Decree 146/2018/ND-CP.

(2) 10% of health insurance contributions shall be intended for the provisional fund and payment of costs of management of the health insurance fund and shall be subject to the following provisions:

- The payment amount of costs of management of the health insurance fund is equal to 5% of total health insurance contribution amount. The annual payment amount of costs of management of the health insurance fund and the payment items shall be regulated by the Prime Minister;

- The amount set aside for the provisional fund is the remaining amount resulting from the deduction from the health insurance fund for costs of management of the health insurance fund under the provisions of point a of this clause, and shall be equal to 5% of total health insurance contribution amount at minimum.

(Article 31 of Decree 146/2018/ND-CP)

5. Management and utilization of the provisional fund in Vietnam

-  Funding sources:

+ Amounts retained annually as prescribed in point b of clause 2 of Article 31 of Decree 146/2018/ND-CP and point a of clause 3 of Article 35 in the Law on Health Insurance;

+ Amounts derived from deferrals or evasions of health insurance contribution payment;

+ Returns yielded from the health insurance fund’s investments;

+ Interests accruing due to deferred payment or evasion of health insurance contributions.

- Purposes of the provisional fund’s allocations:

+ Allocations used as supplementary amounts funding medical services in cities and provinces in case of total health insurance revenue intended for medical services referred to in clause 1 of Article 31 of Decree 146/2018/ND-CP which is less than total expenditure in the year. After evaluation of the cost settlement report, the Social Security of Vietnam shall be responsible for offsetting the difference by using the provisional fund.

+ Allocations used as state budget refunds owing to recurring issuance of health insurance cards.

(Article 35 of Decree 146/2018/ND-CP)

Diem My

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