Rules of paying Health Service Contributions
In Hungary, the Social Security is a social pooling system covering the citizens of Hungary and other natural persons working in Hungary. It means that every single person who works in Hungary has to pay for taking benefits. Pursuant to the Act LXXX of 1997 on the Eligibility for Social Security Benefits and Private Pension and the Funding for These Services (hereinafter: Social Security Benefits Act or SPA) the participation in the social security system is mandatory in accordance with this law.
The article is about the inpayment of the health service contribution and what kind of documents are need to the submission via of the system of the National Tax and Customs Administration (NTCA) to take the health care benefits. At the end of the article will be listed the relevant laws and decrees.
Who is entitled to benefits?
In Hungary the mandatory pay contribution is the basis of the right to benefits. The law determines that who is eligible to take those benefits which are comprised by the law. These persons are the following:
- Insured persons [SPA Sec. 5 (1) points a)-k)];
- Entitlements persons (e.g.: pensioner, students, scholars of schools and education institutions, mental patients and patients treated for pathological addiction in an institution of social therapy, etc.) [SPA Sec. 15 (1) and (2) points a)-f)];
- Persons liable to pay health service contributions in accordance with the SPA Sec. 39 (2) [SPA Sec. 16 (1) point r)];
- Social Security Benefits Provided Under Agreement [ SPA Sec. 34 (1)-(15)].
Who has to pay for health service contribution?
The SPA determines that who is required to pay health service contributions. These person are the following:
- Persons liable to pay health service contributions in accordance with the SPA Sec. 39 (2);
- Private Entrepreneurs engaged in auxiliary activities;
- Business Partnerships on any Business partner who is engaged in auxiliary activities;
- Social Cooperatives shall pay health services contributions on behalf of their members performing work within a member’s work relationship [SPA Sec. 18 (1) point c), Sec. 19 (4) and Sec. 39/B (1)]
Who is considered to be a resident in the view of social security? What conditions are need in additional to be eligible for health contribution services?
Pursuant to the SPA Sec. 4 (1) point u) resident shall mean the following:
- Hungarian citizens who have their address in Hungary registered in accordance with Act LXVI of 1992 on Records of the Personal Data and Addresses of Citizens, persons who have been granted immigrant or permanent resident status and persons with refugee or subsidiary protection status,
- persons falling within the scope of the Act on Admission and Residence of Persons with the Right of Free Movement and Residence (hereinafter referred to as “persons with the right of free movement and residence”), who exercise their right of free movement and the right of residence for a period of longer than three months in the territory of Hungary, provided that they have their address registered in accordance with the Act on Keeping Records on the Personal Data and Address of Citizens, and
- stateless persons.
It is very important for the applicant to be eligible for one of the aforementioned requirements to submit his/her submitting form.
In addition to the above-mentioned conditions, the natural person shall have registered address in the territory of Hungary prior to admission for at least one year without any interruption or in the case of stateless persons who have a residence permit, a registered habitual residence provided for in the Act on the Admission and Residence of Third-Country Nationals. The said one-year period shall include a maximum period of ninety days, during which the resident person did not have a registered address in the territory of Hungary. The state tax authority, if it has no records concerning the said one-year period, shall contact the central body operating the register of personal data and address records of citizens, or the body operating the immigration register as relating to the habitual residence, to request information as to the home address of such resident person for the purpose of determining contribution payment liability. [SPA Sec. 39 (3)]
The provision means that the particular natural person has to be a residence place or habitual residence to be determining his/her contribution payment liability.
What is the time limit in connection with the health service contribution?
A) Beginnings of the contribution payment obligation
The obligation of health service contribution shall be applied for the period beginning on the day following the day of loss of eligibility for health services and ending on the first day of the relationship that is subject to compulsory insurance. [SPA Sec. 39/A (1)]
This provisions briefly means that the natural person (applicant) fell out of the sphere of the health services and compulsory insurance entitlements, and therefore he/she has to pay health service contributions until he/she will not regain the entitlement to the health services, compulsory insurance, or those entitlements which are listed in the law.
B) Reclaim of the health service contribution paid
If the obligation of joining to insurance scheme has generated later than the health service contribution payed, the contribution paid during the life of the insurance relationship may be refunded upon request with the certificate which was issued by the employer. This certificate shall be submitted to the National Tax and Customs Administration (NTCA). [SPA Sec. 39/A (2)]
C) Enter and cancel of the health service contribution
The health care contribution payer shall notify the NTCA regarding the commencement and termination of payment obligations within 15 days. Based on this notification, the NTCA shall prescribe the monthly payment obligations for the tax year on the tax account, keep records of the payments received, and shall cancel contribution payment obligations in the case provided for in this Act or in another act. The NTCA also shall issue a tax identification code to the contribution payer who does not have one. [SPA Sec. 45/A (1)]
The contribution payer shall not be required to notify the termination of payment obligations of health service contribution (see below to the next point), if this payment obligation is terminated by entering into the insurance relationship and that was notified to the NTCA in accordance with the RTA. The national tax authority shall ex officio inform the contribution payer in connection with termination of his/her obligation to pay health service contribution. [SPA Sec. 45/A (2)]
So this provisions mean that the contribution payer has 15 day to notify (submit his/her form) the national tax and customs authority about his/her obligation of health service contribution. This is the same situation when his/her obligation of health service contribution is terminated. The Subsection (2) also describes that if the contribution payer enter into the insurance relationship, the authority will automatically inform the contribution payer, if it happens in the way as the RTA prescribe it. For instance: the employer will notify the authority about the commencement of the insurance relationship.
Relying on the notification regarding to the termination of the obligation of the health service contribution, which was sent to the national tax and customs authority, the tax authority shall supply data concerning the ceased obligation to pay health service contribution within 10 days by way of electronic means to the Health Insurance Fund. It will happen when the contribution payer notify the authority about the commencement of entering into the relationship that is subject to compulsory insurance. [SPA Sec. 45/A (2)]
D) Passive eligibility period (suspended period)
After the termination of the relationship that subject to compulsory insurance, the passive period eligibility is behooved to the insured person for a while. These conditions are regulated by the Act LXXXIII of 1997 on the Services of the Compulsory Health Insurance System (hereinafter: HIA) Sec. 29 (9).
According to the HIA Sec. 29 (9) the entitlement of a resident person provided for in the SPA to health care services in the following time periods:
a) shall remain in effect for a period of 45 days, if the eligibility criteria was satisfied without any interruption for a period of at least 45 days before the time of termination,
b) if the period of existence of the eligibility criteria was less than 45 days, entitlement to healthcare services shall be extended by that time,
c) shall remain in effect for a period of 45 days, if the eligibility criteria previous to the eligibility criteria that was terminated was satisfied without any interruption for a period of over 45 days, and the eligibility criteria that was last terminated did not prevail for a period of 45 days, however, the period between the existence of the two eligibility criteria was less than 30 days.
This provision means briefly that in spite of the ceasing of the insurance relationship of the insured person he/she will entitle to take health care services for 45 days. During this time the social security relationship shall be settled by the insured person.
Who has to pay the health service contribution?
Pursuant to the law any resident person who is not insured and is not entitled to receive health services shall be required to pay health services contributions. [SPA Sec. 39 (2)]
How much HUF health service contribution shall be paid in 2020?
|THE TOTAL AMOUNT OF HEALTH SERVICE CONTRIBUTION||THE DAILY AMOUNT OF HEALTH SERVICE CONTRIBUTION|
|7710 HUF/MONTH||257 HUF/DAY|
|[SPA Sec. 19 (4)]|
Time period for payment of Health Service Contribution
The health service contribution shall be paid by the contribution payer: 12th of each month.
Right to Health Care Service
To be eligible for health care service, it must be comply to the particular provision of Act III of 1993 on Social Administration and the Social Service (SASA).
Pursuant to the SASA Sec. 54 (1) the district office determines the social need for the purpose of health care service to that person:
- in whose family, the monthly income for one person is 120% of the minimum amount of the old age pension;
- who lives alone and his/her income is 150% of the minimum amount of the old age pension and his/her family has no assets.
The official certification of the social need (aka. certification) is issued by the district office. The expiration period of the certification is 1 year. The certification contain the name, the address, in the case of stateless person holding habitual license, the habitual residence, social security identification code of the person in need, the fact of the social need (indigence) and expiration of the certification.
If the aforementioned conditions are still met, the certificate can be reissued. The certificate testify the social need from the date of the submission of the application. The district office keeps record about the persons in need and pursuant the separate law notify the NEAK (National Health Insurance Fund of Hungary aka. NEAK).
Briefly, pursuant to the SASA the eligibility for health care services are benefits which are belonged to the benefits in kind. This benefit provides the free use of the health care services without paying the health service contribution.
What kind of documents are need for submission?
The following documents are needed for submission:
- identification card
- residence card
- tax ID card
- social security ID card
- power of attorney
- submission form 20T1011 (it shall be submitted to the national tax authority)
What changes can be waited for in the near future?
The new social security act (Act CXXII of 2019 on the Eligibility for Social Security Benefits and Private Pension) will enter into force on 1st July 2020. The changes will be described later in this year.
Who conducts the social security system?
The social security system is a multistage system. It is divided by two parts: for health insurance and the pension insurance. These parts create the whole system. This article only deals with the issues of the health insurance.
The issues of the health care and health insurance system are belonged under the control of National Health Insurance Found of Hungary (NEAK).
In countryside, the issues of the health insurances are performed by the district office by the country seat.
In Budapest, the same duties are performed by Budapest Government Office XIII. District Office (together: District Office of the Country). [Government Decree 386/2016 (2 Dec) on the Bodies of Health Insurance Sec. 1 (1) points a), b), c)]
The relevant laws and decrees
Act LXXX of 1997 on the Eligibility for Social Security Benefits and Private Pension and the Funding for These Services
Act LXXXIII of 1997 on the Services of the Compulsory Health Insurance System
Act III of 1993 on Social Administration and the Social Service
Act LXVI of 1992 on Records of the Personal Data and Addresses of Citizens
Government Decree 168/1997 (X. 6.) on implementation of Act LXXXI of 1997 on Social Security Pension Benefits
Government Decree 386/2016 (2 Dec) on the Bodies of Health Insurance
Zoltán Ferenc Samkó J.D.
Health and Sports Lawyer