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Overview of social security in France From Wikipedia, the free encyclopedia
Social security (French: sécurité sociale) is divided by the French government into five branches: illness; old age/retirement; family; work accident; and occupational disease. From an institutional point of view, French social security is made up of diverse organismes. The system is divided into three main Regimes: the General Regime, the Farm Regime, and the Self-employed Regime. In addition there are numerous special regimes dating from prior to the creation of the state system in the mid-to-late 1940s.
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| Sécurité sociale | |
 | |
| Agency overview | |
|---|---|
| Formed | October 19, 1945 |
| Jurisdiction | Government of France |
| Motto | De chacun selon ses moyens, à chacun selon ses besoins (English: From each according to his ability, to each according to his needs) |
| Employees | 150,000 |
| Annual budget | 470€ billion EUR (2018) |
| Agency executive |
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| Parent department | Minister of Health |
| Website | www |
The main concept is that a unique and central institution will pay for all medical costs and pensions so as to provide an equal level of coverage to the whole population. All incomes are taxed to fund this system. The main advantage is that its negotiating power lowers very significantly the price of medicine and the system covers systematically all expenses without limit (100% coverage for any long term or critical problem such as diabetes or cancer). The main drawback being the significant cost (albeit lower than that in the US).
In 2018, Social security paid out €470 billion in social benefits, equivalent to 20% of France's GDP of €2,353 billion.[1] Its main expenditure is on benefits for the sickness branch of the general scheme (€198.3 billion) and benefits for the old-age branch of the general scheme (€126.3 billion). Social security benefit fraud is relatively low (€2.3 billion), lower than social security contribution fraud by companies (€6.8 to €8.4 billion), and much lower than tax fraud (€80 to €100 billion).[2]
From the Middle Ages, certain professional organizations provided limited assistance to their members. However, the abolition of corporations by the Allarde decree, in 1791, put an end to this early system of private professional collective security. It was nevertheless replaced by the sociétés de secours mutuels, or societies for mutual support, recognized and strictly regulated by the 1835 Humann law. These sociétés would thereafter be free from administrative control, and were encouraged by the law of 1 April 1898, referred to as the Charte de la mutualité, or Charter of mutuality. The 1898 law establishes the principles of mutualisme, as they are found today in French law; mutuelles, organizations for collective social insurance, were permitted to offer loans to any French person even if at the beginning, interest rates were too high for the average person.
Alongside the movement for mutual, private social insurance, legislators pushed state-sponsored social aid, which tended to nurture the principle of national solidarity. The law of 15 July 1893, instituted free medical assistance; the law of 9 April 1898, considerably facilitated the worker compensation claims; the law of 27 June 1904, created the service départemental d'aide sociale à l'enfance, a childbirth assistance program; and on 14 July 1905, an elderly and disabled persons assistance program was initiated. France also had, by the 1900s, the most extensive network of child welfare clinics and free or subsidized milk supplies in the world.[3]
The development of insurance companies, at the beginning of the 20th century, was also encouraged by legislation. (Note that insurance companies are profit driven, and mutuelles are cooperatives.) On 9 April 1898, legislators required that employers purchase insurance for indemnity payments to injured employees. Then, on 5 April 1928, insurance was extended to cover illness, maternity, and death. On 30 April 1930, the law was again extended to apply to jobs in the agricultural sector. The bill was supported by Pierre Laval, who went on to serve as the French Prime Minister from 1942 to 1944, in the Vichy government.[4] As a result, the French historian Fred Kupferman has called Laval "the father of social security" in France.[4]
During the Second World War, the National Council of the French Resistance adopted plans to create a universal social security program to cover all citizens, regardless of class, in the event that sickness or injury made them unable to work. In the UK, the first report of the British economist William Beveridge outlined the general principles that would govern the integration and evolution of social security in post-war France. Indeed, the ordonnances of 4 and 19 April 1945, created a generalized, national social security system similar to that described in Beveridge's plan.
The Social Security is financed by payments from both employers and their employees and is administered and managed by all social partners, typically employee unions and/or companies.
The Constitution of the Fourth Republic, adopted by referendum in 1946, created a constitutional state obligation to provide financial assistance to those deemed most socially vulnerable, most notably women, children, and retired workers.
Nonetheless, social security was not entirely universal. The program of the National Resistance Council had envisioned universal social security, but the régime général, or unified social security program, actually created excluded miners, sailors, farmers, and government employees, all of whom were covered by régimes particuliers, or special administrative bodies. Finally, the law of 22 May 1946, limited coverage under the unified social security program to employees of the industrial and commercial sectors.
In the following decades, the unified social security program would gradually be extended by various laws:
The sickness insurance covers the cost of general medicine and special care and dentures, Pharmaceutical expenses and equipment, analysis and laboratory tests; hospitalization and treatment heavy care facilities, rehabilitation, prenuptial examination vaccinations, tests done in public health programs, and the accommodation and treatment of children or adolescents with disabilities. In case of sickness, health insurance provides daily allowances to the insured who is in physical disability and unable to continue or resume work. The daily allowance depends on the daily earning and on the number of dependent children. Health insurance also manages maternity (expenses for examinations and daily allowance during maternity leave), disability (pension granted when the person is unable to work), and deaths.
In order to be taken in charge by health insurance, care and products must meet two conditions: being provided by a public or private practitioner duly authorized to exercise and being included on the list of reimbursable drugs and products. Health insurance operate on the basis of tariffs set by convention or authority. Health insurance does not support all the expenses within the rates used to calculate benefits. In principle, the insured is required to advance the expenses, and social security then reimburses the insured. However, there are some conventions of "third-party payer" providing direct payment for the body to the service.
Health insurance depends on the professional past or present of a person. However, for those not fulfilling the conditions of membership on a professional basis but residing in France for at least three months in a regular situation, there is universal coverage. The insured entitlement to benefits in kind of health insurance and maternity his spouse or partner when it does not have a system of social protection, dependent children and any person taken in charge by the insured and who does not benefit from a system of social protection.
Since 2000, a universal health coverage has been in place, providing two fundamental rights for access to care: a right to health insurance for anyone in stable and regular residence in the territory and a right for the most disadvantaged, submitted to resources, to a free coverage, with exemption from fee.
The first component, for basic coverage, improves access to care for people suffering from extreme exclusion, but also many people temporarily or permanently deprived of the right to health insurance. It also introduced the principle of continuity of rights: a caisse can stop paying benefits only if another caisse takes over or if the insured person leaves the country.
The second component, the creation of an additional free coverage on the behalf of national solidarity, is included in the management of care by health insurance. This reform affects 10% of the most disadvantaged people meeting the criteria of resources and residence.
The accident insurance and occupational diseases is a branch of social security often managed by the same agencies that the health branch. It is the oldest branch of social security. The legislation go back to 1898 and were included in the 31 December 1946 law creating the Social Security.
There are three social accidents for which the risk is better covered than by the accident assurance health insurance. The accident at work is the accident, whatever the cause, occurring because of or in connection with a job, to any person employed by one or more employers or entrepreneurs. Travel accident is an accident occurring on a route between work and home or during a mission on behalf of the employer. A professional disease is a disease of occupational origin and included in a list indicating any occupational diseases, their causes and the duration of incubation.
In the cases of industrial accident, travel from home, or occupational disease, medical care and vocational rehabilitation are totally taken in charge by social security. In case of permanent reduction of working capacity, the victim is entitled a capital (if the rate of permanent disability is less than 10%), and an annuity (if the rate is more than 10%). In case of the death of the insured, the beneficiaries (spouse, children and descendants dependents) receive a pension.
A Caisse d'allocations familiales (‘Caf’ or ‘CAF’, and in English: Family Allocations Office) is a private-sector body with departmental responsibility for paying family and social benefits to individuals (statutory benefits) under conditions laid down by law.
Family benefits consist of:
Family benefits are granted to any French or foreign person residing in France with a dependent child or children living in France under 20 (or 21 years for housing allowances to family).
All the schemes of basic and supplementary pensions in France work on the method of distribution. The schemes redistribute every year, in the form of pensions paid to retirees, contributions received that year from the assets. If the rules of the various pension plans in France correspond to different concepts, they are based on common principles. All schemes incorporate mechanisms of solidarity: solidarity between generations (principle of distribution) and solidarity within a single generation (large redistributions between different occupational groups and gender). These principles of solidarity occurs both in the regimes, between the regimes and beyond regimes at the national level. There are transfers between the schemes, and therefore solidarity between the basic schemes, as well as mechanisms for schemes coordination. Solidarity at the national level consists of the minimum old-age pension assigned to all seniors who have limited resources, paid by the solidarity fund retirement (which also pay some family benefits), but also of state subsidies granted to certain regimes (farmers, SNCF, RATP, mining, marine, etc.), and finally of various taxes allocated to pensions. The retirement system in France is organized into three levels: a compulsory system, a scheme that is often mandatory, and optional arrangements.
The Allocation de Solidarité aux Personnes Agées (solidarity allowance for the elderly) (ASPA) is a French state pension for elderly people, whether or not they are former employees, on low incomes. It replaced the multiple components of the minimum pension (Minimum Vieillesse) from 1 January 2006. To qualify for ASPA, the recipient must live in France and meet age and financial need criteria.
The system of social security is financed largely by contributions based on the wages of employees. However, new funding policies have sought to broaden the base by taking into account all the household income, and policies to promote employment led to lighten the burden of contributions on low wages.
The income of social security schemes are traditionally divided along the following categories:
The budget of the social security system is separate from the budget of the state and is subject to a separate vote and an act of parliament (Loi de finances de la sécurité sociale). The 2010 budget amounted to 428 Bn €.[5]
| Spending | Resources | Balance | |
|---|---|---|---|
| Health | 153,4 | 141,8 | -11,6 |
| Pensions | 102,3 | 93,4 | -8,9 |
| Family | 52,9 | 50,2 | -2,7 |
| Workplace accidents | 11,2 | 10,5 | -0,7 |
| Total (General regime) | 311,5 | 287,5 | -23,9 |
| Total (All systems) | 427,5 | 402,0 | -25,5 |
Although the social security system achieved surplus between 1999 and 2001 thanks to the late 1990s economic recovery, it has since been repeatedly achieved important deficits, especially in 2009-2011 in the aftermath of the Great Recession. The 2013 budget was forecast to reach 469 billion € and a deficit of 12.6 billion €.[5] Marisol Touraine, Minister of Social Affairs and Health, announced in September 2016 that the social security budget would be balanced in 2017 for the first time in 16 years.[6]
In addition to the three main regimes there are numerous special regimes dating from prior to the creation of the state system which refused to be merged into the general system when it was created. The main special regimes are:
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