New provisions concerning the co ordination of social security schemes reg 883 2004
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New provisions concerning the co-ordination of social security schemes Reg. 883/2004. Competences under the Treaty. No harmonisation National competence to define and build social policy schemes remains unchanged, except Ban on discrimination Equal treatment of women and men

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Competences under the treaty
Competences under the Treaty security schemes

No harmonisation

National competence to define and build social policy schemes remains unchanged, except

  • Ban on discrimination

  • Equal treatment of women and men

  • Free movement of persons, goods and services

  • Competition and State aid rules

  • Public procurement

    Only co-ordination?


What is co ordination
What is Co-ordination? security schemes

  • Equal treatment

  • Export of benefits

  • Aggregation of periods

    Legal base in the Treaty – frequent changes!

    Maastricht: Art. 51 + Art. 235 (self employed)

    Amsterdam: Art. 42 + Art. 18 (Union citizens) + Art. 308 (self employed)

    Nizza: Art. 42 + Art. 308 (Union citizens + self employed) + Art. 63 Abs. 4 (third country nationals)

    European Constitution: Art. III-136 + Art. III-267 (third country nationals)


History
History security schemes

Reg. 1408/71 already aged !

Ø does not cover new risks (long term care, child care)

Ø centred around gainful activities

Ø Parallelism Reg. 1408/71 – ECJ Reg. 1408/71 – Reg. 1612/68

Start: European Council of Edinburgh (1992)

SLIM - Simpler Legislation for the Single Market


Start of the work
Start of the work security schemes

Proposal of the Commission December 1998

Revolutionary changes:

Ø open material and personal scope 

Ø far reaching equalisation of facts 

Ø pro-rata-reimbursement for pensioners 

Ø 6 Months export of unemployment benefits 

Ø Unemployment benefits for frontier workers by the last state of employment 

Ø Always highest amount of family benefits


How far did we get
How far did we get? security schemes

When will the new Reg. 883/2004 enter into force?

on the 20th day after its publication – 27.6.2004 

When will 883/2004 apply?

From the entry into force of the new Implementing Reg.

possible impediments on the way to new Reg. 883/2004  

  • Elaboration of the new Implementing Reg.

  • 10 new Member States 

    Ø Missing Annex X (special non contributory besenfits) 

    Ø Missing Annex XI (special provisions)


Personal scope of reg 1408 71
Personal scope of Reg. 1408/71 security schemes

Employed and self-employed persons, students, if they are nationals of a Member State, refugees or stateless

Members of the family irrespective of their nationality

Employed and self-employed have to be covered by a national scheme of social security


Personal scope of reg 883 2004
Personal scope of Reg. 883/2004 security schemes

All persons covered by a scheme

Nearly no influence on social insurance schemes

Third country nationals remain excluded

  • legal base!!

    Reg. 859/2003 remains applicable -> therefore

    For third country nationals Reg. 1408/71 remains in force in its present form


Third country nationals reg 859 2003
Third country nationals security schemesReg. 859/2003

Already applicable – Reg. 1408/71 applies correspondingly

Problems:

  • Third country nationals legally residing in the territory of a Member State

  • cross border elements

    Does not apply in relation to DK, special provisions concerning family benefits granted by AT + DE


Schemes beyond employment
Schemes “beyond employment” security schemes

All persons subject to the legislation = all persons covered

All schemes covering the risks

Invalidity / sickness / death

Exemption of victims of war still valid

Possible impacts - Annex XI?

  • Damages caused by officials or military actions

  • Schemes for victims of crime

  • Insurance burden provisions


Material scope reg 1408 71
Material scope security schemesReg. 1408/71

Legislation concerning:

  • Benefits in case of sickness and maternity

  • Benefits in case of old age, invalidity or to survivors

  • Benefits in case of accidents at work and occupational diseases

  • Death grants

  • Unemployment benefits

  • Family benefits


Material scope reg 883 2004
Material scope Reg. 883/2004 security schemes

Not very much innovation

New: 

  • Paternity benefits equivalent to maternity

  • Pre-retirement benefits

  • Explicit exemption of advances of maintenance payments

  • Inclusion of all special schemes for the “Liberal professions”

    No solution: 

  • Special provision for long term care benefits

  • Special provision for child care benefits

  • Freedom to provide services (patient mobility)


Pre retirement benefits
Pre-retirement benefits security schemes

What exactly is meant?

Old age part-time? Not clear because in many Member States benefits to the employer, not to the employee

Cases Kutz-Bauer und Steinicke – Working conditions under Dir. 76/207

Therefore not at the same time social security?

In any way - No aggregation!


Advances of maintenance payments
Advances of maintenance payments security schemes

Cases Offermanns und Humer – AT “Unterhaltsvorschuss” covered by Reg. 1408/71

Problems in case of residence of the child outside the competent state

Big success: Advances to maintenance payments excluded from Reg. 883/2004 (Annex I)

Therefore no export but equal treatment (Art. 12 EC - Cases Cowan, Martinez Sala)


Long term care benefits
Long term care benefits security schemes

Cases Molenaar und Rs Jauch – sickness benefits

No special provision

Nevertheless hope?

  • Art. 34 to avoid overlapping; deducting the benefit in kind from the benefit in cash

  • Annex X – special non contributory benefits – case Hosse; pressure to elaborate a special chapter on co-ordination for such benefits


Long term care benefits possible ways of co ordination
Long term care benefits - possible ways of co-ordination security schemes

  • Export of cash benefits only through the institution of the place of residence

  • This institution has the obligation to inform the persons concerned

  • This institutions deducts the amount of the benefit in kind

  • Corresponding deduction of reimbursement (special provision in case of lump sums)

  • Important: Overpayments have to be avoided


Child care benefits
Child care benefits security schemes

No special provision

Co-ordination problematic (e.g. child care in DE, mother frontier worker from AT still in employment)

  • Family-view (like all other family benefits)

  • Individualised-view

    ECJ: Family view correct - case Dodl and Oberhollenzer


Special non contributory benefits
Special non contributory benefits security schemes

New Definition (Art. 70):

  • In case of supplementary, substitute or ancillary coverage – minimum income

  • In case of benefits solely for the protection for the disabled – link to the social environment

    Non contributory – no financing by contributions; no problem for supplementary benefits to contributory benefits


Equal treatment of facts
Equal treatment of facts security schemes

New provision (Art. 5):

(lit. a): equal treatment of benefits and income – corresponds to Art. 12 (2) of Reg. 1408/71

(lit. b): general equalisation

“where under the legislation of the competent Member State legal effects are attributed to the occurrence of certain facts or events, that Member State shall take account of like facts or events occurring in any Member State as though they had taken place in its own territory.”


Equal treatment of facts consequences
Equal treatment of facts security schemesConsequences

  • Danger: e.g. creation of periods of insurance

  • Therefore: no impact on aggregation (Rec. 10) or on competences (Rec. 11)

  • Important: one provision for all Member States

  • ECJ up until now always in that direction

  • Legal simplification


Equal treatment of facts limits
Equal treatment of facts security schemesLimits

Example:

Child care periods in pension insurance

Child care whenever in any Member State?

Important: Connection with competence (always state of residence?)

Is correction of case Kauer possible?

There are only very few possibilities for deviations

Important: Annex XI


Aggregation
Aggregation security schemes

Central uniform provision (Art. 6)

In case of voluntary insurance no restriction to persons who have been already gainfully active in that Member State

Via equalisation of facts: equivalent periods could be created by foreign periods of insurance

Impact e.g. on periods of military or civilian service,

School or university studies if equivalent periods under national legislation


Applicable legislation reg 1408 71
Applicable legislation security schemesReg. 1408/71

Insurance only in one Member State allowed – various designations of competent State

  • place of gainful activity

  • posting for a maximum of 12 months

  • prolongation for further 12 months

  • normally exercise of an activity in more than one Member State -> State of residence

  • problems in case of termination of the activity

  • agreement on exceptions


Applicable legislation reg 883 2004
Applicable legislation security schemesReg. 883/2004

Most important changes:

  • Legislation of the previous state of activity in case of receipt of short term benefits in cash

  • For all non active persons the legislation of the state of residence applies

  • 24 months of posting (no E 102 any more)

  • Normally exercise of an activity in more than one Member State: legislation of State where a substantial part of activity is exercised


Applicable legislation problems
Applicable legislation - Problems security schemes

Unsolved problems:

  • Retroactive corrections to achieve lawful status

  • Impact of labour law and workers protection on social security

  • Obligation of employer without any representation in the state of exercise of the activity to information and to pay the contributions


Sickness benefits reg 1408 71
Sickness benefits security schemesReg. 1408/71

  • Benefits in kind under the legislation of the state of residence or stay

  • No special provisions for entitlement under the freedom to provide services

  • Benefits in cash under the legislation of the competent state


Sickness benefits reg 883 2004
Sickness benefits security schemesReg. 883/2004

Important amendments (including those brought by Reg. 631/2004 to Reg. 1408/71)

  • Equalisation of entitlements for all persons (already since 1.6.2004)

  • European Health Insurance Card (already since 1.6.2004)

  • More rights for frontier workers

  • New cost reimbursement provisions

  • But again no codification of rights under the freedom to provide services


Equalisation of entitlements
Equalisation of entitlements security schemes

No difference between employed or self-employed persons / pensioners / stay abroad of employed persons / students / holidays (since 1.6.2004)

Entitlement depends on nature of the benefit and the expected length of the stay

Direct contact to the service providers (doctors, hospitals) abroad (since 1.7.2004)

E 112 authorisation has to be granted if treatment cannot be given within a time-limit which is medically justifiable (Reg. 883/2004)


European health insurance card
European Health Insurance Card security schemes

New since 1.6.2004: EHIC or replacement form

States with transition period (AT, IT, LV, LT, MT, NL. PL, PT, SK, HU, UK, CY) – introduction at the latest an 1.1.2006

In many Member States combination with national cards

Since 1.6.2004 in any case new E 111; after end of transition period for a Member State: Replacement form


More rights to frontier workers
More rights to frontier workers security schemes

Family members (like active frontier workers) automatic choice between benefits in state of residence or employment –if no restriction in Annex III

Retired frontier workers: right to continue treatments already begun in state of employment

Retired frontier workers: continued right of choice if frontier worker during 2 years of the last 5 years and entry in Annex V

More rights also for pensioners who receive treatment in the competent state – entry in Annex IV


Reimbursement
Reimbursement security schemes

Fight against inequalities especially in case of pensioners

Principle: real cost refund

Lump-sum of 85 %, state of residence costs of E 112, competent state pays all other benefits

Lump-sum of 80 %, if competent state pays all benefits in its territory (Annex IV), E 112 costs by state of residence, competent state pays all other costs of treatment outside the state of residence


Pensions reg 1408 71
Pensions security schemesReg. 1408/71

Important principles:

  • Aggregation for entitlement

  • If aggregation is necessary: calculation of theoretical amount for all periods and then pro-rata

  • If aggregation is not necessary: national or pro-rata-pension (highest amount)

  • Insurance periods < 12 months – other state has to pay

  • Equalisation of requests


Accidents at work and occupational diseases reg 1408 71
Accidents at work and occupational diseases - Reg. 1408/71 security schemes

Benefits in kind (e.g. treatment after an accident) – same principles as in case of sickness

Accident pensions are paid by the state where the accident occurred or in which the last period of exposition is reckoned

Internal pro-rata of costs in case of special lung diseases (sclerogenic pneumoconiosis)


Pensions and accidents at work or occupational diseases reg 883 2004
Pensions and accidents at work or occupational diseases - Reg. 883/2004

No major amendments

Accident insurance: No pro-rata in case of sclerogenic pneumoconiosis

Pensions: Equalisation of requests still open if information is missing

Pensions: Anti-Cumulation: partition of deductible amount and not any longer of the amount of the benefit which will be suspended

Pensions: Problems with national reforms (funded schemes)


Unemployment benefits reg 1408 71
Unemployment benefits Reg. 883/2004Reg. 1408/71

Exportation: max. 3 months; receipt of benefits in previous state of employment for 4 weeks, return, otherwise loss of entitlement

Frontier worker: unemployment benefit under legislation of state of residence

Seasonal workers: either stay in state of employment, export of unemployment benefit for 3 months or immediately unemployment benefit from state of residence


Unemployment benefits reg 883 2004
Unemployment benefits Reg. 883/2004Reg. 883/2004

Exportation: same conditions, but 3 + 3 months

Frontier workers: unemployment benefit from state of residence but search of employment also in previous state of employment

Seasonal workers and frontier workers: reimbursement of unemployment benefit by previous state of employment: 3 months + 2 months (if insurance 12 months during last 24 months)


Family benefits reg 1408 71
Family benefits - Reg. 1408/71 Reg. 883/2004

Difference between active persons (all family benefits) and pensioners (only family allowances)

Priority of gainful activity over residence

Differential amount by state which has not the priority


Family benefits reg 883 2004
Family benefits - Reg. 883/2004 Reg. 883/2004

Clear new provision, identical for all persons for all benefits – residence is not relevant

Clear hierarchy of competences

  • Gainful active persons

  • Pensioners

  • Entitlement only due to residence

  • In case of entitlements of the same type - residence

  • Suspended competence: differential amount


Different other amendments by reg 883 2004
Different other amendments by Reg. 883/2004 Reg. 883/2004

Also in other fields essential amendments:

  • Replacement of data exchange by electronic exchange

  • Collection of contributions and recovery of undue benefits directly applicable


First assessment
First assessment Reg. 883/2004

Has the simplification been successful?

  • XI in stead of VIII Annexes!

  • Various possibilities for options in sickness insurance

  • Complex provisions in the field of unemployment

  • No solutions for new social risks, unresolved questions

  • Decisions of ECJ not all transformed

    + Central provision on equalisation of facts

    + Central provision on aggregation

    + Provisions and Annexes simplified

    + Start for special co-ordination of long term care benefits


Farewell to reg 1408 71
Farewell to Reg. 1408/71? Reg. 883/2004

No! Complex parallelism of Reg. 1408/71 and Reg. 883/2004

Reg. 1408/71 remains applicable for:

  • Reg. 859/2003 concerning third country nationals

  • EEA-Agreement

  • Agreement on free movement in relation to CH

  • Reg. 1661/85 concerning Greenland

    No farewell to Reg. 1408/71 – but farewell to simplification!


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