Basics of Azerbaijani Compulsory Medical Insurance – Insurance
Azerbaijan: Basics of Azerbaijani Compulsory Medical Insurance
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By Law No. 1441-VQD of December 28, 2018, changes implementing compulsory health insurance in Azerbaijan from January 1, 2020 were introduced into Azerbaijani law, About medical insurance (the “Medical insurance law“).
The introduction of compulsory health insurance was launched in January 2020 and was to apply throughout the country gradually in four stages, the last stage being completed in 2021.
Compulsory health insurance applies to Azerbaijani citizens, foreigners and stateless persons with refugee status. As such, the Medical Insurance Act requires such people, among others, to pay an insurance premium.
Compulsory health insurance is financed from various sources, including the insurance premium. The collection of insurance premiums from employees began to apply from January 2020 and constitutes two percent of wages equal to or greater than AZN 8,000 and 0.5 percent of wages exceeding AZN 8,000; employers pay premiums on the basis of the same percentages and thresholds. For employees engaged in the non-oil and non-public sector, a 50% reduction will apply until January 1, 2022.
The insurance premium is payable at the same time as the salary, but no later than the 15the next day of the month.
The insurance premium for individual entrepreneurs, notaries and members of the Azerbaijani Bar Association is four percent of the minimum monthly wage, currently 250 AZN. The insurance premium is payable no later than the 15the next day of the month.
The insurance premium is also calculated from petrol, diesel and liquid gas produced (for wholesale) or imported into Azerbaijan at AZN0.02 per liter. The insurance premium is payable no later than the 20the next day of the month.
The unemployed, as well as those who do not exercise an entrepreneurial activity are exempt from paying the insurance premium until January 1, 2024. In the meantime, the insurance premium for these people is paid from the budget of the ‘State.
Failure to pay an insurance premium up to AZN 50,000 is punishable by a fine of 30-70% of the unpaid amount. Payment of the insurance premium by the person who committed the offense for the first time exempts that person from administrative liability.
The insurance premium is collected in the Compulsory Health Insurance Fund, which covers the medical services received by the insured in accordance with the Compulsory Health Insurance Services Package.
The Compulsory Health Insurance Service Package approved by Resolution No. 5 of the Cabinet of Ministers of the Republic of Azerbaijan, dated January 10, 2020, covers approximately 2,550 miscellaneous medical services, including first aid, medical care emergency medical, specialized outpatient care, laboratory services, physiotherapy services, invasive radiology services and institutional treatment.
Compulsory health insurance does not apply to servicemen, detainees, persons serving a term of imprisonment and life imprisonment (except for penitentiaries of the pregnant type), temporary and permanent residents or stateless persons.
The implementation of compulsory health insurance is ensured by the National Agency for Compulsory Health Insurance, which was established by presidential decree on December 27, 2007 as the National Agency for Compulsory Health Insurance reporting to the Cabinet ministers of the Republic of Azerbaijan.
Supervision of the calculation and payment of insurance premiums is carried out by the State Tax Service under the Ministry of Economy of the Republic of Azerbaijan.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
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