From deficit towards a surplus
The universal health coverage has definitely benefited masses of citizens from all walks of life, regardless of socioeconomic status. But of course this requires enormous funds to sustain it. In 2021, the majority of such funds (97.94 percent) came from members’ premiums. All people work together to pay their due contributions to finance other people’s health. Thus, it is not entirely true that the rich are a burden to JKN. All participants who pay contributions are entitled to JKN benefits, as stipulated in Article 16 of the SJSN Law.
In 2021, total JKN revenue amounted to Rp146.58 trillion, consisting of Rp143.31 trillion from premium contributions, Rp1.08 trillion from cigarette excise tax, Rp1.42 trillion from investment, Rp274.38 billion from unused budget funds (SILPA) on a capitated basis and Rp480.84 billion from others.
Meanwhile, total expenses in 2021 amounted to Rp102.13 trillion, consisting of Rp90.33 trillion for health insurance, Rp4.41 trillion to increase technical reserves, Rp4.09 trillion for operating expenses, Rp3.27 trillion in expenses for impairment of premium receivables and Rp19.6 billion for others.
After incurring six years of deficit (2014-19), BPJS Kesehatan posted a surplus of Rp38.76 trillion at the end of 2021, sufficient to cover 5.15 months of potential claim payments. Due to this healthy financial condition, BPJS Kesehatan issued a policy to provide advance payments to hospitals to support their financial obligations related to payment of claims.
The graph below shows the financial condition of BPJS Kesehatan from 2014-2021. (GRAPH-1)
Since JKN began operation, and up until 2019, income from premium contributions has not been able to cover the high burden of health insurance and operating costs, leading to a deficit. In 2014, this totaled Rp3.3 trillion and in 2015 it jumped to Rp5.76 trillion. As a result, the government was forced to shell out Rp6.82 trillion to patch the deficit hole in 2016.
Despite receiving government assistance, BPJS Kesehatan continued to incur a deficit, to the tune of Rp14.46 trillion and Rp11.68 trillion in 2017 and 2018, respectively. Again, the government had to inject Rp3.6 trillion and Rp10.25 trillion of public funds in respective years.
The deficit continued to rise, to Rp17 trillion in 2019. This time, instead of providing another round of state fund injection, the government issued Presidential Regulation (Perpres) 75/2019 which amended Presidential Decree 82/2018 on the increase in premiums. It stipulated the increase of premium for recipients of contribution assistance (PBI) from Rp23,000 to Rp42,000 per month; civil servants/military/police personnel earning up to Rp12 million in salary and allowances to pay 5 percent; private sector employees earning up to Rp12 million and business entities still pay 5 percent; while independent workers pay Rp42,000 for Class 3, Rp110,000 for Class 2 and Rp160,000 for Class 1.
However, the Supreme Court (MA) annulled the premium contributions of independent workers, forcing the government to re-issue Presidential Decree 64/2020 which revised the amount of premiums to Rp42,000 for Class 3, Rp100,000 for Class 2 and Rp150,000 for Class 1. Meanwhile, premium for PBI was set at Rp25,500 in 2020 and further declined to Rp7,000 in 2021 and subsequent years.
This increase, coupled with the Covid-19 pandemic, impelled BPJS Kesehatan’s revenue to surge to Rp139.85 trillion, while health insurance costs were down to Rp95.51 trillion, as participants were afraid of going to a hospital. In 2021, premium income continued to rise, to Rp143.32 while expenses slid to Rp90.33 trillion.
As a result, the net assets of JKN social security funds (DJS) drastically increased to Rp38.76 trillion in 2021, from minus Rp5.69 trillion in 2020 and minus Rp51 trillion in 2019.