Friday 06 April 2018
There continues to be uncertainty over the scope of the PUMA health insurance charge, notably in relation to early retirees and those with private health insurance.
The position of economically inactive early retirees is one that remains unclear on a number of counts, as has so often been the case in the past.
Although the PUMA legislation states that those who receive a ‘pension de retraite’ are exempt from the annual charge, it makes no distinction between different types of pensions (State or employment based) and neither is a minimum age stated.
The law also excludes from the charge those in receipt of a life annuity ('rente'), which similarly leaves the door open for early retirees to be exempt.
As a result, some readers have decided to challenge the charge, either because they consider their early retirement pension simply exempts them entirely from it, or that they accept they should pay, but that the authorities have included their pension in the calculation when only 'revenu du patrimoine' should be considered. In other cases, URSSAF, the social security collections agency, have not granted the standard allowance of €9,654 before determination of the charge, which some of you have challenged.
The evidence to date indicates that different approaches are being taken at a local level by URSSAF offices, not always to the detriment of households. However it is inconceivable the authorities meant to grant automatic free health cover to expatriate early retirees, the practical effect of excluding them from the charge on the basis of receipt of a pension. The exclusion of the basic allowance is clearly an administrative error and we are aware of cases where URSSAF have conceded on this point.
Under the previous Couverture Universelle Maladie (CMU) health regulations early retirees were liable for the health charge after a basic allowance of around €9,600 per year, and this is likely to remain the position under PUMA, albeit some redrafting of the legislation seems in order.
More broadly, although access to PUMA can be granted after three months legal residence in France, the regulations that prevent access to the health system by EEA ‘inactifs’ under 5 years legal residence remains in place.
That position is confirmed by the CLEISS, the international social security liaison office in France, who state that as far as 'inactifs' are concerned "l'accès à la protection universelle maladie (Puma) et à la CMU complémentaire ne vous sera pas automatiquement accordé. Cet accès sera possible si vous avez la qualité de résident permanent. Si vous résidez sur le territoire français depuis moins de 5 ans, votre situation sera examinée par la caisse d'assurance maladie au cas par cas."
Nevertheless, many early retirees continue to obtain access to the system, in large measure due to the fact that since 2013 all such applications are redirected by local health authorities to a central processing centre in Nimes. Whilst there is strong evidence that most applications are being treated favourably by the centre, all are considered on a case-by-case basis, and one of the factors that is taken into consideration is whether the applicant has sufficient resources not to be a burden on the social security system.
You can read more about the law and process at Health Cover in France for Early Retirees.
Also affected by a lack of clarity in the new regulations are those expatriate households who obtain their health cover via a private insurance policy.
Whether State retired or early retired, many American citizens in France hold such policies, but there are also other nationalities who do the same, either because they have been refused access to the health system, or because it is financially advantageous for them to do so.
In order to obtain a visa to live in France it is necessary to have health insurance cover, which for some migrants can only be obtained via a private health policy.
However, despite holding a private insurance some readers are telling us that they have received a bill from URSSAF for the PUMA charge!
The legal basis on which this has been carried out is highly questionable, for Article L160-1 of the Code de la sécurité sociale requires that there must be a ‘prise en charge’ of health cover for it to apply. That is to say, that the applicant's health costs are covered by the French state system.
In a statement to us ACOSS, the national body of the URSSAF regional agencies, stated that provided the household was legally resident in France, a private policy was without consequence for imposition of the charge, stating: "Le bénéfice de la PUMA et l’assujettissement éventuel à la cotisation constituent des règles d’ordre public auxquelles il n’est pas possible de se soustraire dès lors que les conditions afférentes (résidence, revenus) sont remplies. La souscription d’une assurance privée est sans conséquence à ce titre sur l’assujettissement à la cotisation.
We are aware of several cases that are now in the appeals system to contest the imposition and that ACOSS are reviewing the matter, and we will provide a further update in due course.
Conversely, some expatriate households in France who have previously held a private policy have been offered access to the health system via PUMA, as a result of which they have been able to give up their sometimes expensive and less than comprehensive private health policy.
There is also controversy concerning the affiliation date from which a household is liable for the charge.
A circular from November 2017, which sets out the administrative procedures in relation to the charge, makes it clear that it can be applied on a pro-rata basis in the year, from the date that the household obtains admission to the system.
Nevertheless, some households have received a demand for the whole year, despite either not being in the system due to private insurance, or only having joined the system part way through the year after their application had been accepted.
ACOSS have stated to us that the charge applies automatically from the date the household became legally resident, as follows : "Si la circulaire du 15 novembre 2017 précise que la cotisation est due à compter de la date d’affiliation à la PUMA cette affiliation est automatiquement réalisée lorsque le bénéficiaire vérifie les critères de résidence stable et régulière ou de travail en France."
This statement is clearly at odds with the law because applications for affiliation are subject to an explicit approval process and the definitions of residency upon which affiliation is conditioned were not provided until a regulation published in May 2017.
Moreover, the circular itself says the people may contest the charge based upon the true date of affiliation.
Eric Fenster, who is a member of AARO (Association of Americans Resident Overseas), has told us: "As an American, it is gratifying to see a country honor a pledge to make medical insurance for all its residents the norm. What's unacceptable is the surprise billing after a two year communication vacuum. People who had in good faith subscribed to private insurance, as instructed, were told they owed retroactively for coverage they didn't have and so couldn't have used."
On a positive note, the authorities have now formally accepted that EEA State retired households with an S1 certificate are exempt from the charge, including the spouse/partner who may be covered via the S1 holder.
Although towards the end last year many S1 holders received a notice for payment of the 'cotisation', URSSAF have not proceeded with a demand for payment, either as a result of your remonstrations or of other information they were provided by the health authorities.
URSSAF themselves seem to have acknowledged that the preliminary notice was sent out based on fiscal information, not the health affiliation status of households.
ACOSS have also confirmed to us that S1 holders are not liable for the charge stating: "la cotisation PUMa ne s'applique pas aux personnes bénéficiant exclusivement d'une pension de retraite britannique, résidant en France et n'y exerçant en parallèle aucune activité professionnelle, à condition que celles-ci puissent justifier par la fourniture du formulaire S1 qu'ils relèvent du régime britannique."
This same rule applies to those from other European countries in possession of either an S1 or E121.
The exclusion of S1 households arises directly from EEA regulations and the French social security code, as such households remain covered via their home country. Strictly speaking, therefore, S1 holders are not affiliated to PUMA.
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