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Indonesia’s social security programs are run by two organizations – the Social Security Administrator for Health (BPJS Kesehatan) for healthcare and the Workers Social Security (BPJS Ketenagakerjaan) for pensions. 

The government has riased the taxable wage cap for the national pension plan program from March 2020. 

The government launched its ambitious universal healthcare and pension programs in 2014. Since its inception, the healthcare program has become the biggest in the world with more than 185 million participants. Registered Indonesians and expatriates are eligible for free health services ranging from dental care to medicines to physiotherapy. Further, patients are also eligible for free emergency and chronic care, in addition to organ transplants. 

Who is eligible?

The government has made it mandatory for all Indonesian citizens and expatriates to participate in the social security programs. Expat employees must also enroll their families in the programs. 

How to determine healthcare class facilities?

The BPJS healthcare system is divided into three classes. This does not determine the level of treatment a patient receives, but it does determine the type of hospital room they will be given. Hospital rooms in Indonesia come with varying levels of comfort and size. 

Class I patients are provided rooms with two or three other patients while class II patients have to share with three to six others. Class III patients will have to share with 10 or more patients. 

How to calculate the healthcare premiums for employees?

The premium for employees is calculated as five percent of the monthly salary, with a salary cap of 12 million rupiah (US$722). 

In the private sector, the employer must pay four percent and the employee the remaining one percent. For civil servants, the government contributes to three percent while the employee contributes two percent. 

In addition to the employee, the premium also covers their spouse and up to four dependent children up to the age of 21. Employees earning less than 4 million rupiah (US$241) per month are eligible to receive Class I room facilities at the hospitals. Employees earning lower than this can receive Class II and III room facilities. The level of treatment is the same regardless of class type.

What are the premiums for employees?

Five percent of an employee’s monthly salary will go towards paying for the healthcare premium, with a salary cap of 12 million rupiah (US$821).

Workers in the private sector will pay one percent, and the remaining four percent will be paid by their employer. For civil servants, the government contributes three percent, and the employee, two percent. Further, the premium covers the employee’s spouse and three dependent children up to the age of 21.

What are the healthcare premiums for non-employees?

The premiums for individuals that are classed as non-employees/self-employed /non-formal workers can be seen in the following table.

Healthcare Premiums for Non-Employees in Indonesia

Class type

Rates

Class I

150,000 rupiah (US$10.26) per person, per month

Class II

100,000 rupiah (US$6.84) per person, per month

Class III

35,000 rupiah (US$2.39) per person, per month

For those paying for Class III, the government will top up an additional 7,000 rupiah (US$0.47)

Pension premiums for employees

The pension program covers the following:

  • Work compensation – provides protection for accidents occurring during or as a result of work;
  • Old age benefits – provides protection for participants that are in retirement, laid off;
  • Pension benefits – provides guaranteed income in retirement; and
  • Life insurance – upon the death of the participant, their heirs can claim the benefits.

[tips title="Did You Know"]Under Government Regulation 37 of 2021 (GR 37/2021), the government has introduced a new unemployment benefit program (Job Loss Security program (JLS) — the first of its kind in the country.[/tips]       

The JLS scheme does not however, provide universal coverage as only employees who are already registered with the Workers Social Security program will be eligible. Employees who have been made redundant and are eligible for unemployment benefits will receive cash stipends for up to six months, further skills training, and career guidance information.

Who will be eligible for the unemployment scheme?

GR 37/2021 states that employees must meet the following conditions to be eligible for unemployment benefits:

  • Must be an Indonesian citizen;
  • Have not yet reached 54 years of age when registering for the benefits;
  • Must be formally employed; and
  • Must be registered in both BPJS Kesehatanand BPJS Ketenagakerjaan programs at least six months before the termination of employment.

How are the new premiums calculated?

Employers will contribute 0.46 percent of their monthly wages to the JLS program, in which 0.22 percent is contributed by the government and the remaining 0.24 percent from the employer.

Importantly, the employer’s contribution is taken from the re-composition of the life insurance and work compensation components of the pension program.

Under GR 37/2021 the employer’s contribution to the life insurance component has been reduced by 0.1 percent from 0.3 percent of the employee’s monthly wage to become 0.2 percent. Further, the work compensation contribution has also been reduced by 0.14 percent from 0.24 – 1.74 percent to produce the new range 0.10 – 1.60 percent.

The maximum salary used as the basis for the calculation is capped at six months’ salary of 5 million rupiah (US$352).

Workers Social Security Scheme

Areas Covered

% of monthly wages

 

Employer contributions

Employer contributions after GR 37/2021

Employee contributions

Life insurance

0.3%

0.2%

-

Accident insurance

0.24-1.74%

0.10 – 1.60%

-

Old age benefits

3.7%

-

2%

Pension plan

2%

-

1%

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