From the initial exploration in 15 cities in 2016 to the official promulgation of the national establishment documents, it took ten years for long-term care insurance to complete the leap from local pilots to national unification.
On the 25th, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council issued the "Opinions on Accelerating the Establishment of a Long-term Care Insurance System" (hereinafter referred to as the "Opinions"), which marked the official launch of long-term care insurance, known as the "sixth insurance" of social security, across the country.
The opinions are clear that it will take about three years to basically establish a long-term care insurance system that covers the entire population, coordinates urban and rural areas, is fair and unified, safe and standardized, and is sustainable by the end of 2028.
Ordinary people are most concerned about the two questions regarding the nationwide implementation of long-term care insurance: "How much money do I have to pay?" and "What services can I enjoy?" The opinions provide answers to both questions.
How much to pay? The rate is uniformly controlled at around 0.3%
The long-term care insurance system is a social insurance system that provides services or financial guarantees for basic daily care and closely related medical care for disabled people. It is an important part of my country's social security system and an important part of the implementation of the national strategy to actively respond to the aging population.
The opinion proposes to establish and improve multiple financing channels such as units, individuals, governments, and society. Establish a benchmark premium rate system for long-term care insurance at the national level, standardize payment base policies, reasonably determine premium rates, and implement dynamic adjustments.
The financing standards and sharing mechanism of long-term care insurance can be summarized as follows: the premium rate of long-term care insurance is uniformly controlled at around 0.3%, with employees and individuals each paying half. Retirees pay individually according to their pension levels. Urban and rural residents can have half of the premium rate at the initial stage and receive financial subsidies. People with flexible employment can choose to pay as "employees" or "residents", and personal medical insurance accounts can pay for the whole family.
The Opinion stipulates that the employee fee rate of the unit shall be shared by the employer and the individual in the same proportion. The employer's payment base shall be the total wages of the employees, and the individual payment base shall be his/her salary income. The employer and the individual shall pay jointly. The rates for retirees are the same as the individual rates for unit employees, and the payment base is linked to the pension level. The contributions are paid by the individuals, and the original employer does not pay.
Funding for long-term care insurance for unemployed urban and rural residents is reasonably shared by individuals and the government. Individuals pay and the government provides subsidies in accordance with regulations. Government subsidies are jointly borne by the central and local finances.
Dai Weidong, a professor at Zhejiang University of Finance and Economics, told China Business News that the 0.3% rate for long-term care insurance is equivalent to the payment rate for low-risk industries for work-related injury insurance. It is one of the lowest social insurance rates and fully considers the affordability of all parties.
A vivid metaphor is that long-term care insurance uses the price of a cup of milk tea to exchange for protection in the event of disability.
In order to minimize the payment pressure, the opinion also proposes that in the year when the long-term care insurance system is established in various places, the rate for unemployed urban and rural residents will be halved starting from about 0.15%, and gradually transitioning to about 0.3% in about five years. Places with conditions can also start from about 0.3%.
In the specific local implementation, the payment groups are mainly divided into four categories: unit employees, retirees, flexible employment personnel and urban and rural residents. The specific payment standards are different for different groups.
Taking Hainan Province as an example, the payment rate for employees in the first category of units is 0.3%, with the unit and individual sharing 0.15% each. The payment base is consistent with the basic medical insurance. Based on this, it is estimated that the average monthly payment of active employees is about 12 yuan.
The second category of retirees makes it clear that their original employer does not pay contributions, and the individual contribution rate is 0.15%. The payment base is the personal basic pension. Based on this, the average monthly individual retiree payment is estimated to be about 5 yuan.
The payment rate for the third category of flexible employees is 0.3%, and the payment base is 60% of the average salary of employees in all urban units in the previous year. In order to reduce the pressure on individuals to pay, Hainan Province has correspondingly reduced its basic medical insurance payment rate by 0.15%, that is, from 5% to 4.85%. Based on this calculation, the fees paid by flexible employment personnel are actually only 2 yuan more per month than before.
The fourth category is urban and rural residents. In the initial stage of establishment, the payment rate is 0.15%. The payment standard for the first year is 34,829 yuan per capita disposable income of urban and rural residents in Hainan in the previous year, multiplied by the payment rate of 0.15% for that year, a total of 52 yuan. Individuals share half of it at 26 yuan per year (about 2 yuan per month), and a total subsidy of 26 yuan is provided by finance at all levels.
Based on the payment principle of equal rights and obligations, the long-term care insurance system will objectively impose certain payment responsibilities on enterprises and individuals. Will that increase the burden on businesses and individuals?
Dai Weidong said that in the early days of the establishment of the current system, in places where the employee medical insurance fund balance is relatively sufficient, the medical insurance unit rate can be reasonably adjusted to the long-term care unit rate without additional burden on the unit. Employees' personal payments can be partially used in the medical insurance personal account, and the individual's cash burden will not be increased.
Hainan Province adopts a flat rate method. While the unit pays 0.15% for long-term care insurance, the basic medical insurance payment rate is reduced by 0.15%, that is, from 6% to 5.85%. In fact, the unit does not need to make additional payments.
In addition, the opinions also stipulate that the government will provide classified subsidies to the individual contributions of eligible needy groups. Persons under the age of 18 participate in the insurance along with their parents or other legal dependents, and do not raise funds independently. The personal account of the employee basic medical insurance can be used for personal payment of long-term care insurance for myself and my close relatives (including spouse, parents, children, brothers and sisters, grandparents, grandchildren, and grandchildren).
Enjoy what? Provide care services without paying directly
The opinions stipulate that in the initial stage of the system, severely disabled people will be protected. To enjoy benefits, one must pass a disability level assessment and meet the prescribed standards. Dai Weidong emphasized that the "gatekeeper" of long-term care insurance is the assessment of disability level, which is not divided by age – no matter the elderly, young and middle-aged people or children, as long as they reach the level of disability due to illness, disability and other reasons, they can enjoy it.
The opinion clearly stated that the fund is mainly used to pay the expenses incurred by qualified long-term care service institutions and personnel in providing basic long-term care services. In principle, cash will not be directly distributed to disabled people.
In principle, cash is not distributed directly to the disabled to ensure that the long-term care fund is used to care for the disabled so that the disabled can truly benefit. In local pilot projects, two situations often arise when direct cash payments are made. One is that the money is misappropriated for other household expenses, and the disabled person still does not receive care. The other is that although the family has received the money, they lack professional nursing knowledge, and complications such as pressure sores and infections are still unavoidable.
Zhu Minglai, director of the Health Economics and Medical Security Research Center of Nankai University, told China Business News that taking service as the core and promoting industry specialization are the core features of long-term care insurance benefits. In principle, the fund does not directly distribute cash to disabled people, but pays for the care services actually enjoyed by disabled people. This means that the insured enjoys professional services, and the fund pays directly to the service agency, rather than giving the money to the individual to use it however he wants.
In September last year, the National Medical Insurance Administration released the "National Long-term Care Insurance Service Catalog (Trial)", which included a total of 36 services from daily care items such as assistance with eating and excretion to medical care items such as catheterization and rapid blood glucose measurement into the national unified long-term care service item catalog, delineating a unified and standardized long-term care insurance fund payment scope, and providing clear and authoritative reimbursement guidelines for disabled people and their families.
Zhu Minglai believes that there are deep-seated considerations behind not directly distributing cash to disabled people in principle. Through the method of "purchasing services", long-term care insurance can effectively promote the development of the nursing service industry and enhance professional service capabilities. Only when service becomes the core of payment can the market be cultivated, professional institutions grow, and service personnel gain a stable career development path.
