Social security coordination and the European Health Insurance Card

Since the EU has always partly been about encouraging labour mobility within its borders, it should be no surprise that some of its oldest legislation is about social security coordination. Social security coordination refers to the body of law implemented by Member States which ensures that people can cross borders to work and live, temporarily or permanently, without losing access to social security benefits. It is separate from the issue of “posted workers”, which refers to arrangements for people who are employed by a firm in one Member State and sent to work in another. It does not mean that there is a European system of social security, any more than there is a European health system.

These provisions mean that if an individual moves to another country for a job, the social security rights that have been built up (including rights to healthcare) move with the person; similarly, if an individual temporarily travels to another EU country for a purpose such as work, study or holiday and falls ill, he or she is covered and will be treated by that country’s health system.³⁴ However, if someone wishes to go abroad for the purpose of healthcare itself, then these provisions are highly restrictive; prior authorization is required from the domestic authorities, which is very rarely given (not surprisingly, as they have to pay the cost of such healthcare, and generally prefer to provide healthcare domestically). Reflecting these provisions, the volume of patients travelling to other countries in order to receive healthcare within the EU has historically been marginal.

Social security coordination has four principles overall, as stated by DG EMPL:³⁵ 1. You are covered by the legislation of one country at a time so you only

pay contributions in one country. The decision on which country’s legislation applies to you will be made by the social security institutions.

You cannot choose.

33 Greer SL, Kuhlmann E (2019). “Health and Education Policy: Labour Markets, Qualifications, and the Struggle over Standards”, in St John SK & Murphy M (eds.). Education and Public Policy in the European Union. London: Palgrave Macmillan, pp. 67–88.

34 See European Commission (2014). European Health Insurance Card. Brussels: European Commission.

Available at: http://ec.europa.eu/social/main.jsp?langId=en&catId=559, accessed 14 July 2014.

35 https://ec.europa.eu/social/main.jsp?catId=849.

2. You have the same rights and obligations as the nationals of the country where you are covered. This is known as the principle of equal treatment or nondiscrimination.

3. When you claim a benefit, your previous periods of insurance, work or residence in other countries are taken into account if necessary.

4. If you are entitled to a cash benefit from one country, you may generally receive it even if you are living in a different country. This is known as the principle of exportability.

Because health was long considered as part of the social security system in many Member States, it was not surprising that the core mechanism for handling cross-border healthcare was located in social security coordination. It produces the core, visible, benefit of the European Health Insurance Card (EHIC). There is substantial legal and policy literature on the health policy dimensions of social security coordination.³⁶ An EHIC is the tangible and portable manifestation of two European rights that the (limited) data on it helps to implement.

The first right is to emergency care on the same terms as citizens when travelling abroad for a short term (around three months or less). Thus, if citizens of a Member State must pay a co-payment for treatment, so must people using an EHIC. The second right is to care in another Member State on the same terms as citizens if the home system has pre-authorized the care.

Member States then settle accounts with each other for EHIC treatment given to each other’s citizens. In some cases, as with British and German citizens in Spain, this amounts to both a bargain for the home Member States, since Spanish healthcare costs less, and an economic growth strategy for the sunny parts of Spain where they congregate. It is administered by DG Employment, Social Affairs and Inclusion. The internal politics of how Member States administer EHIC charges and reimbursement are not always straightforward and the EU is sometimes unfairly blamed for distortions created within systems by Member State administrative decisions (e.g. slow reimbursement to providers or underpayments).

The law of social security coordination is made by unanimity in the Council – one of the few areas of EU internal law where this stands. That shows how concerned Member States are to maintain their autonomy, and how easy it is to cause problems with these intricate systems. After a long period of legislative stability under Regulation 1408/71, the EU passed a new pair of regulations in 2010

36 Palm W, Glinos IA (2010). “Enabling patient mobility in the EU: between free movement and coordination”, in Mossialos E et al. (eds.). Health Systems Governance in Europe. Cambridge: Cambridge University Press, pp. 509–61; Hervey TK, McHale JV (2015). European Union health law. Cambridge: Cambridge University Press.

that promised “modernized coordination”.³⁷ Modernized coordination is more modern in both technical and social policy terms. In technical terms, it improved on the technology for data transfer that was available in 1971, launching an electronic system for the transfer of social security information between Member States. In social policy terms, it moved social security coordination and rights to social security away from the traditional labour market-based male-breadwinner model by expanding rights to include parental and other leave, and expanding the covered population to include people who were not working (e.g. young, retired or simply not working). A model built around single male guest workers was modernized for the twenty-first-century European economy.

The 2016 Commission Work Package responded to pressure from, in particular, the UK to reduce the benefits available to EU citizens in other countries with a further legislative proposal.³⁸ It reflected a British political reaction to the large inflow of EU Member State citizens in 2004 and a perception, often exaggerated by the UK media, that immigrants from the rest of the EU were attracted by the UK benefit system and were exploiting it. In the run-up to the Brexit referendum, when the EU was trying to adopt policies that would respond to British preferences, the solution was a proposal for a new Regulation focused on fighting fraud, by enabling better information exchange (by establishing a “further permissive legal basis”³⁹), and on tying the location of work more closely to the location in which benefits were paid. The UK was the principal EU Member State in which intra-EU immigration, or the perception of unfair advantages to immigrants from other EU Member States, was a difficult political issue. This was in large part because the UK and Sweden were the only Member States that opened their labour markets to citizens of the CEE accession states in 2004, and therefore saw the largest number of arrivals. Predictably, some other Member States were happy to let the UK draw fire for pressing a restrictionist case they supported. While those tensions around intra-EU migration were present in other Member States, it is unlikely that this issue will retain such prominence

37 Regulation (EC) No. 883/2004 of the European Parliament and of the Council of 29 April 2004 on the Coordination of social security systems (Official Journal, L 166:1); Regulation (EC) No. 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation (EC) No. 883/2004 on the coordination of social security systems (Official Journal, L 284:1).

38 2016/0397 (COD) Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No. 883/2004 on the coordination of social security systems and regulation (EC) No.

987/2009 laying down the procedure for implementing Regulation (EC) No. 883/2004.

39 Regulation of the European Parliament and of the Council amending Regulation (EC) No. 883/2004 on the coordination of social security systems and Regulation (EC) No. 987/2009 laying down the procedure for implementing Regulation (EC) No. 883/2004.

after Brexit.⁴⁰ The health effect of the change should lie in two areas: in limiting the number of people in certain categories (e.g. short-term residence) who can claim social security benefits, and in incorporating long-term care into social security coordination.

One point worth underlining in the discussion of social security health mobility is that it is far more important to patients and health systems than patient mobility under internal market law. The integrating dynamics of the EU mean that while internal market law, discussed in chapter 4, led to the integration of healthcare as a service subject to EU law, the actual provision of healthcare across borders was a problem that was largely solved in 1971. The legal and political drama that began with the Kohll and Decker decisions, and which provisionally ended with the Directive on patient rights in cross-border mobility, was about whether healthcare was a service under normal EU law. It was not about the patients.

It was never about the patients.⁴¹ It was about who would make health law in Europe, and to what end.