President Bachelet: “This is an effective way of recognizing the tremendous contribution each and every one of you has made to the progress of our nation”
The President of Chile, Michelle Bachelet, together with the Treasury Minister, Rodrigo Valdés, and the Employment and Social Security Minister, Ximena Rincón, this morning enacted Law 20,864, which eliminates the 5% healthcare contribution payments by pensioners aged over 65 and establishes other benefits. The bill was approved by the upper house of Congress on September 9. This fulfills the pledge made by the President on May 21 and demonstrates the Government’s commitment to investing in the social protection of Chile’s most vulnerable people, as well as contributing to the wellbeing and improving the quality of life of the most vulnerable senior citizens.
Currently, close to 600,000 senior citizens who receive the Basic Solidarity Pension (Pensión Básica Solidaria or PBS) or the Pension Solidarity Complement (Aporte Previsional Solidario or APS) are exempt from paying the 7% healthcare contributions. In addition, since December 2012, healthcare contributions have been reduced from 7% to 5% for 340,000 pensioners who do not qualify for the Basic Solidarity Pension or Pension Solidarity Complement but who meet the following economic and residency requirements: they must be over 65 years old, have lived in Chile for at least 20 years – either continuously or in total, and for at least four of the last five years – and they must be from a family belonging to the four least affluent quintiles of the population. This is the group that will be exempted from making healthcare contributions under the new law.
This help will translate into an improvement in the amount of their pensions. The State will cover the difference in the healthcare contributions to ensure that the senior citizens maintain the same healthcare rights as they have at present, whether they have public or private healthcare plans.
The bill will also extend the funeral benefit to all pensioners in receipt of the Basic Solidarity Pension ( for old-age and disability) with over 8,500 points on the Social Protection Register; and to recipients of the Pension Solidarity Complement aged 65 and over with less than UF15 (US$580) in their Individual Capitalization Account (Cuenta de Capitalización Individual or CCI). In total this measure will benefit around 336,000 pensioners.
Following these announcements, the President emphasized that “with every milestone that we achieve, we are showing the country that it is possible to improve things; that it is possible to make progress towards a development that will have a positive impact on the lives of our fellow citizens.”