Want to run a business in France? Here’s what you need to know about health insurance

If you are self-employed or you run your own business in France, what are your legal obligations regarding providing a healthcare scheme to employees?

Whether you are a company based in France, or outside of France and have a base of employees in France (even one employee), employers have a legal obligation to provide a company healthcare insurance to employees. And if you’re employed on a permanent contract in France, it’s important to know your rights! Paulette Booth at Agence AXA International explains. 
How does the French healthcare system work?

Access to healthcare in France is not free (although exceptions apply). Social security will refund a percentage of the cost, with the average refund being 70%.

Refunds from social security for treatments and prescriptions will vary depending on the type of treatment. For example, a visit to a GP will be refunded at 70% of the €25* cost if the GP is registered as your ‘médecin traitant’, 30 % if not. (*€25 is the usual cost of a GP visit but can be higher).

Social security set a fee for each procedure and will refund a set percentage of this which is called the base de remboursement.

A ‘mutuelle’ top-up insurance can be used to pay the outstanding amount after the social security reimbursement. There are many different levels of mutuelle ranging from just hospital treatment up to covering almost all costs. The most popular levels of mutuelle are 100% and 125%. This is the percentage of the base de remboursement, which the mutuelle top-up insurance policy will pay up to, rather than the actual cost.

A mutuelle policy can also provide cover to contribute or pay the cost of a private room while in hospital, complementary treatments, and even enhance your cover for private clinics and specialists. Additional services are available for home help, pet care and study support and receiving home help care.

What are the obligations of an employer?

All companies in France must be affiliated to a Convention Collective Nationale (CCN). A CCN sets out the minimum levels of cover that must be provided for a company’s workforce.

The Décision Unilatérale de l’Entreprise (DUE) is the document whereby the company itself sets out how it is going to apply the conditions to its workforce. An employer is legally obliged to provide a company mutuelle top-up as soon as there is at least one employee.

If a company has employees that are cadre (senior roles) they must put in place an employee benefits scheme (prévoyance) policy too, in addition to the mutuelle. The company may set different conditions for cadre and non-cadre which will require separate associated DUEs.

What is the minimum level of ‘mutuelle’ cover?

There are multiple levels available for the company mutuelle scheme, from the minimum legally required, to higher more comprehensive cover. The minimum level an employer must offer their workforce will depend on the CCN. The minimum contribution to the cost is 50% and the employee will pay the other 50%, but an employer can choose to contribute a higher percentage to the cost.

To summarise, the breakdown of who pays what percentage of the cost depends on what is set in a CCN, the

demographic of the workforce, and the choice of level of insurance. Cover can also be for the employee only, the employee and their children, or the employee, partner and children together.

An employer is also obliged to offer optional enhanced cover (option facultative) to the policy on top of the base guarantees (socle).

An employee can choose if they wish to add any of the options. The extra cost of the option, if taken, is at the expense of the employee.

It is a simple process. There is no need for employees to complete a health questionnaire, and pre-existing conditions are not considered when setting the cost of the contract and will be covered.

What about the employee benefits scheme?

The employee benefits scheme will cover death in service, short-term illness and accident, longer term illness/disability/invalidity and a widow and children’s pension.

An employer has two obligations for offering an employee benefits scheme (prévoyance). Firstly, for all cadre employees, an employer’s minimum obligation is to contribute 1.5% of the employee’s gross salary.

Secondly, an employer must comply with the CCN which may require higher contributions and might require an employee benefits scheme for non-cadre staff.

Do companies need to offer a pension plan?

In addition to the company mutuelle scheme and the employee benefits scheme, an employer can also offer employees a pension plan.

Contrary to the mutuelle and employee benefits schemes, an employer is not obliged to offer a pension plan. It will however give employees an additional pension income on top of their state pension.

The cost is a percentage of the employee’s gross salary. In France, it’s important to make sure employees feel rewarded for their work, particularly considering the scale of social security contributions an employee will pay.

A company mutuelle scheme, employee benefits scheme and a pension plan are good ways to attract and motivate a workforce!

Paulette Booth is a manager at Agence AXA International