Bill 421.

Summary.

The bill prohibits public institutions, across all their branches, from including budget appropriations to purchase private health, life, accident or similar insurance for public servants. The prohibition covers state institutions, including autonomous and semi autonomous entities, state enterprises, municipalities, and mixed ownership companies in which the State holds shares. It addresses the inclusion of appropriations for those insurance purchases in institutional budgets. It applies to insurance intended for public servants at any of the institutions covered by the provision. (Art. 1).

For public servants’ coverage, the bill provides that they would be covered exclusively by services supplied by the Social Security Fund (Caja de Seguro Social) and the Ministry of Health (Ministerio de Salud). It also preserves each public servant’s option to purchase private insurance voluntarily, provided the purchase is paid for with personal funds. This provision distinguishes institutional budget appropriations for private insurance benefiting public servants from insurance that public servants choose to purchase themselves. The bill expressly names both institutions as providers of the services that would cover public servants. (Art. 2).

The prohibition has exceptions for insurance required under international treaties ratified by the Republic of Panama (República de Panamá) and for insurance relating to diplomatic and consular missions abroad, provided no applicable national coverage exists. It also excepts life insurance for security services, subject to prior justification. These are the forms of coverage the bill excludes from the general prohibition on including private insurance appropriations in institutional budgets. The condition concerning the absence of applicable national coverage is stated in relation to diplomatic and consular missions abroad. (Art. 3).

If a state institution includes budget appropriations for private insurance for officials, the bill provides that the expenditure is void. It also provides for those responsible to be sanctioned, as applicable, under the Law on Property, Criminal and Administrative Liability (Ley de Responsabilidad Patrimonial, Penal y Administrativa). For budget oversight, it directs the Executive Branch (Órgano Ejecutivo), through the Ministry of Economy and Finance (Ministerio de Economía y Finanzas), to ensure compliance with the prohibition and reject on its own initiative any budget appropriation that breaches it. The bill thus links inclusion of such an appropriation to void expenditure, applicable sanctions for those responsible, and rejection of the appropriation. (Arts. 4-5).

The bill repeals all legal or regulatory provisions contrary to the proposed law and sets its entry into force upon promulgation. Its subject matter relates to the Social Security Fund, the Ministry of Health, the Executive Branch and the Ministry of Economy and Finance. It could also concern the public institutions covered, their public servants, security services, diplomatic and consular missions, and the private insurance sector. (Arts. 6-7).