Clarification on Compulsory Health Insurance for Expatriates

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Mar. 31- Vietnam’s Social Insurance Agency has clarified a previous regulation that mandates the country’s health insurance system be expanded to include expatriates and foreign organizations.

It is now clear that Decree 69 and Circular 09 will only cover expatriates  that are employed under the Vietnamese labor law as confirmed by PWC Vietnam. Expatriate employees hired from the overseas head office and sent to the country are not included in the regulation. Moreover, foreign employees remain exempted from the country’s social insurance and unemployment scheme.

Under the health insurance law, the maximum contribution is 20 times the minimum salary stipulated for the administrative sector or about less than US$25 per person. The contribution rates are 3 percent from July 1, 2009 to December 31, 2009 and 4.5 percent beginning January 1, 2010.

Overall, the new health insurance scheme puts an additional administrative burden on employers to meet requirements for both local employees and locally-hired expatriates.