The end of S1s for early retirees

The UK government plans to save money on healthcare for expats and visitors, a move which could have wide-ranging effect

26 February 2014

The UK government plans to save money on healthcare for expats and visitors, a move which could have wide-ranging effects starting as soon as this spring.

THE UK government has stated that it plans to stop issuing S1 health forms to early retirees moving to France, probably from April 1, 2014, in a bid to save money for the NHS.

From that date, it means new expats who are not drawing state pensions, not in work nor self-employed will have to take out private healthcover on arrival, which could involve substantial costs and complications if there are any pre-existing conditions excluded by such policies.

This would relate only to new S1s - existing residual S1 forms will remain in place and continue to be valid until their cessation date. There are no plans to change the issue of S1s to state pensioners.

In the longer term the UK states it will also look at ensuring all non-residents are identified as such, so as, for example, to recoup money for treatment from their country of residence (via the EHIC card scheme - see box right) or to charge them directly for many kinds of healthcare if they do not have such entitlements. It has not been clarified how this would work.

The kinds of healthcare deemed “chargeable” are expected to be extended to include matters such as A&E care but not just ordinary hospital treatment as is the case under current UK rules.

One further effect of the loss of S1s is that future early-retiree Britons in France would not be eligible for an EHIC (or its French equivalent, a CEAM) and therefore would have to pay for treatment in the UK.

However, the report favours allowing free UK treatment to people with a “long-term relationship” with the UK, relating to National Insurance records – a plan which, depending on details to be agreed, may benefit early retirees.
Details as to who would be entitled and for how long have not been given.

The announcements came in the government’s official response to a consultation exercise it held last year to seek ways to save money on healthcare costs relating to people who are not permanent residents of the UK, including Britons living in other parts of the EU and visitors generally to Britain.

Announcing the plans, Health Minister Lord Howe said: “Having a universal health service free at the point of use rightly makes us the envy of the world, but we must make sure the system is fair to the hard-working British taxpayers who fund it.”

The response document states that the government has “a responsibility to ensure the NHS is sustainable” adding that “we cannot afford to provide free healthcare to the world”.
Detailed implementation plans are expected to be set out in March.

The UK government claims it informed and sought opinions from the public on these issues as well as from interested bodies including in other “EU member states”.

Despite this Connexion has been unable to find any readers in France who were aware of the consultation while it was taking place.

A board member of the British Community Committee, the official nationwide body representing expats in France, said they too had not been aware of the consultation.

However, since reporting on the issue, many readers have expressed concerns to Connexion.

In its response the government states: “Few respondents had views about changing current arrangements on payments which the UK is not legally obliged to make under EU law including issuing residual S1 forms to early retirees who move to another EEA country and the practice of refunding EHIC co-payments made when receiving healthcare in another EEA country.”

The former point relates to the UK’s current practice of issuing S1 forms lasting up to two-and-a-half years to people who have made recent UK National Insurance payments but are not yet state pensioners.

The S1, also issued permanently to British state pensioners, means the UK pays France for holders’ treatment in France to the same level as received by people in the French system.

In the UK financial year 2012/13 about 1,200 people with temporary S1s were registered in France.

The response document notes that NHS workers who were consulted “nearly unanimously supported” stopping temporary S1s although one legal group opposed it, saying such a step may deny British citizens who move to another member state the benefits of migration.

“Co-payments” refers to the UK refunding the full cost of healthcare in France for visiting Britons using the EHIC, as opposed to only refunding to French state levels as EU law requires.

The original consultation also included a proposal that Britain would seek to pay less to countries like France for healthcare for its pensioner S1 holders on the understanding that they could be permitted to use UK services.

However the response document merely states “there is more we can do to reduce net payments” and that the government will undertake work to do so.

No further detail is given, though the document notes in an annex that some people canvassed expressed concerns about “safeguarding those UK pensioners who decide to have the entirety of their healthcare needs provided in another EU country, where the S1 form seems to work very well.”

Other plans in the response include a “health surcharge” to be levied on non-EU immigrants to the UK with temporary residence visas and possibly making charges for healthcare to EU citizens settling in the UK who are early-retirees (though the UK states it is investigating the legality of this).

What is impact of stopping temporary S1s? Issue of the forms is likely to cease from April 1, although on going to press this have yet to be confirmed.

It means that any early retirees leaving Britain to live in an EU country such as France would not be able to join the French reimbursements system with funding from the UK, and they cannot pay individually to enter it.

Most will therefore have to take out a full private policy with immediate effect (see Connexion January 2014 edition for an in-depth look at this).

Should this pose problems, an application to join the French system under the CMU system (free for those on very low incomes and then paid for at 8% of income above a certain ceiling) would, under current French rules, depend on the decision of state health insurance officials in Nîmes.

In theory, this requires notions of unexpected misfortune and the outcome is uncertain, although the French are under pressure from the European Commission to allow the CMU to permanent residents. French rules allow it as a right after five years of residency.

What do the plans mean for expats?
At present the government’s report states that Britain only charges expats and other visitors (ie. those in the UK temporarily, for less than six months) for hospital treatment, with this charge
covered, as applicable, via the CEAM/EHIC, people’s private insurance policies or out of their pocket.

However the government admits that checks on people’s status as non-residents so as to ensure payment are often not made consistently or effectively.
It states it will therefore seek to create new systems to make sure non-residents are identified – possibly including checking NHS numbers and patient records - and where applicable will engage in “more vigorous pursuit of bills”.

EHIC details would be “systematically recorded”. Details of procedures remain to be agreed. As of 2015/16 it expects to extend charging to new areas.
GP consultations would remain on free access, but as they are a “gateway” to other services, GP practices would be involved in the checking procedures.

However some other forms of primary care in the community such as dispensing of drugs (in cases where they are free or subsidised) as well as dental and optical services, may also become chargeable.

The government also states “there is a good case” to be made for visitors paying for A&E services, although admit it will be delicate to work out ways of doing so “without compromising rapid access to emergency care”.
It intends to introduce charges once it is “confident” that it can be done.

In parallel, however, the government concedes that “like other public healthcare providers” it has “a legal, ethical and moral duty” to provide emergency healthcare where needed, “even if costs are not recoverable”.

What about people in the French system?
If you are in the system through work in France or through the CMU, you are entitled to a French CEAM when visiting the UK. On presenting this you would be entitled to free treatment for essential medical care that becomes necessary during your trip, with the UK recuperating the costs from France.

If you are a British state pensioner with a permanent S1 then you would present your British EHIC.

Effectively your rights should not change, but you should expect more thorough checks on your residency status and EHIC details.
Bearing in mind the EHIC is for treatment becoming necessary during a stay, not “health tourism”, the new procedures are also meant to pick up on people who the government states have been using UK services illegitimately.

It distinguishes “health tourists” - people seeking “free” treatment they are not entitled to, including some whom it states do so while making regular visits to UK relatives - from “medical tourists” who are upfront about their visit and pay for services.

Note however that it is possible for French residents to seek some elective healthcare in the UK and be reimbursed by their Cpam, as long as it is
a kind of treatment reimbursable in France.

Typically this requires prior authorisation from the Cpam. New EU rules simplifying this were supposed to have been ratified by France by last October, but appear to have been delayed.

How would early-retirees be affected?
Early retirees will have no EHIC or CEAM.

On visiting the UK they would have to pay for chargeable services themselves, potentially then seeking reimbursement from an insurer if they have a comprehensive policy including foreign travel, or have bought separate travel insurance for the trip.

Would maternity treatments be exempt?
No, the government says that deliberate maternity health tourism is a problem and it will not introduce any new exemptions for this.

What does the government say about free healthcare for expats?
It supports the idea that those who have “made a fair contribution” to the UK, eg. by working and paying National Insurance, should remain entitled to free NHS care.

It expects this to come into force “later in 2014”, after further analysis, including establishing how long people should have made NI payments for and how recently
and how long the entitlement should last.

Is one solution for newcomers denied S1s to set up as auto-entrepreneurs in France as this is free to do and gives healthcare rights?
You are right that this form of self-employment is free to set up and gives healthcare rights but bear in mind that if you do this and have no turnover to show after two years, you lose its advantages.

What is an EHIC?
The EHIC card covers essential health care needs arising while travelling away from your home country within the EU and is supplied by the UK to British residents who are travelling abroad – such as holiday home owners in France – and to British state pensioners in France (including for treatment in the UK).
France issues its version (the CEAM) to residents of France in the French system.

The EHIC lasts for five years, the CEAM just a year. You request a CEAM (free) from your Cpam via your personal space at www.ameli.fr or on 3646.

For British EHICs for expat pensioners call the International Pension Centre on 0044 191 218 7777.

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