Why You Should Offer Private Health Insurance in Indonesia to Your Remote Workers

Are you planning to outsource your companies back office services in Indonesia? You might assume that your prospective team, probably predominantly in their 20s and 30s, won’t give much thought to their healthcare status. In reality,  private health insurance in Indonesia is seen as a premium upgrade by potential employees.

This article will provide an overview of the difference between standard health insurance mandated by Indonesian law and private healthcare plans. We’ll also demonstrate why you should offer this benefit to increase your recruitment potential in the competitive Indonesian labor market.

Overview of mandatory and supplemental health insurance plans in Indonesia

Understanding public vs. private health insurance in Indonesia

Indonesia’s public healthcare system is called Badan Penyelenggara Jaminan Sosial (BPJS) Kesehatan. BPJS is a mandatory healthcare service for any employer (local or foreign) hiring in Indonesia.  It is therefore your responsibility to sign up new employees with the local government and deduct statutory contributions on each paycheck (shared between employee and employer at 4% each).

Think of BPJS as your standard SaaS freemium package. It’s reliable and gets the job done, but it doesn’t offer much beyond the essentials. Under the public healthcare system, employees and their families must visit government sanctionned clinics and generally experience longer wait times and more extensive bureaucracy. BPJS also usually only covers basic treatments and diagnostics.

Private health insurance in Indonesia is generally a lot more flexible. Employees can choose which hospital to go to, and private clinics are generally more modern, and offer a more complete range of health services. Wait times in privatized healthcare is also usually shorter and establishments are better equipped for handling diverse treatments and scenarios.

Comparison between public and private healthcare packages for your employees

It is important to consider a multitude of factors when determining whether or not to offer private health insurance in Indonesia to your employees. Below you will find an overview of the main points of differentiation between the two plans:

Cost of private health insurance in Indonesia

In most cases, private health insurance in Indonesia is divided in levels, with the lower tiers offering less coverage, and the higher tiers offering more extensive options. Remember that the exact cost of your plan depends on the date of joining and how you customize your service agreement. Below you will find an overview of the estimated costs for standard private plans:

• Level 3 Basic plan
  Inpatient: Room rate up to IDR 500,000.
  • Outpatient: Annual limit of IDR 3,000,000.
  • Annual Cost: Starting from IDR 2,046,700 per person.
  • Inpatient: Room rate up to IDR 800,000.
  • Outpatient: Annual limit of IDR 5,000,000.
  • Annual Cost: Starting from IDR 3,309,700 per person.
  • Inpatient: Room rate up to IDR 1,200,000.
  • Outpatient: Annual limit of IDR 6,000,000.
  • Annual Cost: Starting from IDR 4,560,000 per person.

  RecruitGo can help you put in place an efficient private health insurance plan for your remote teams in Indonesia. Alternatively, by hiring employees via our Employer of Record service, you can sign up for one of our existing agreements which are specially designed for standing out in indonesia’s competitive job market.

  Cultural relevance of private health insurance in Indonesia

  It is important to clarify that this is not a promotional piece on private health insurance. BPJS Kesehatan does a decent job at covering the basics and most likely your employees will not need much beyond that. However, our objective is to help you attract and retain the best talent in Indonesia. And providing private health insurance is a relatively inexpensive way to do that.

  Indonesia has a very family-oriented culture. Even as adults, Indonesians take career advice from their parents, and one major talking point for older generations is what happens if their children get sick. So even if younger employees are less likely to need much of specialised health care, providing them access to it is seen a a significant benefit from a cultural standpoint.

  Indonesian work culture is also fast-paced, especially in more metropolitan areas such as Jakarta. Therefore by offering private health insurance, you are also providing your employees with time, as they will have to spend less time waiting and filling paperwork for clinic visits, as generally they can simply present a health insurance card and be seen.

  How Private health insurance in Indonesia can help your recruitment strategy

  As mentionned above, Indonesia is a highly competitive labor market, due to the fact that the workforce is mainly comprised of young, technologically savvy individuals. When outsourcing high-demand roles such as software developers, accounting advisors, and virtual assistants, you must adapt your international recruitment strategy to attract prospective candidates.

  Private healthcare in Indonesia is one of the most requested supplemental benefits requested by employees in emerging markets. Due to the flexible nature of the service and the fact that it is generally quite affordable for foreign employers, it is highly recommended to consider this when planning to hire in Indonesia. 

  RecruitGo’s local experts are well-versed in the different service providers in most Southeast Asian markets. We can also help you manage employee payroll to account or social security and health insurance contributions for all your global teams. Want to start hiring in Indonesia? Contact us via the form below to get in touch with one of our local recruitment consultants!