Month-to-month inflation: how much did social security benefits increase in 2024?

After the deregulation that took effect on February 23, social security and prepaid health insurance companies are already planning increases for the whole of 2024. In March, the average increase reported will be approximately 25% and for April a similar percentage is estimated, while in the rest of the months it could be in line with inflation.

However, according to the Unión Argentina de la Salud (UAS), these adjustments would not be sufficient, since there is at least a 40% backlog for 2023 due to the increase in the costs of the social security and prepaid health insurance companies which, with the prices regulated in their plans, caused the increases to be insufficient.

How much did the social security funds increase in 2024?

During 2023, social security and prepaid health insurance plans increased by 134% against inflation, which was 211.4%.

This occurred because the previous government had implemented a system in which, before implementing an increase, they had to be authorized by the Superintendence of Health Services. This measure would be disaffected with the deregulation of social security and prepaid health insurance.

Regarding the 2024 increases, there were strong increases in January and February, well above inflation. In January, in general, the increases were around 40%, while in February they were 36% and even charged retroactively.

Thus, the increases in the first two months are more than 75% over December values, a figure that will exceed the 100% barrier in March, when the aforementioned 25% increase will be applied.

For the rest of the months, the increases are not yet known, although it is likely that they will begin to be in line with inflation.

What are the changes in the free competition scheme implemented by Milei?

One of the main changes implied in the new scheme to be implemented by the government is that prepayment companies will have to allocate 20% of their revenues to the Redistribution Solidarity Fund, which will be used to cover high-cost medical practices and treatments. The regulation will be published in the Official Gazette in Decree 70/2023.

In addition, another change is that, as from April, workers will be able to transfer their salary contributions to a prepaid health insurance company without the intermediation of a social security company. It should be recalled that Javier Milei, shortly after taking office, allowed the incorporation of prepaid medicine companies to be included in the regime of Law 23.660 of the social welfare funds.

This measure, which two months after its publication has not yet been applied, allows prepaid companies to receive contributions from the social security system. In order to do so, these companies must be registered in a special registry.

Likewise, the prepaid companies will be able to continue establishing the prices of their plans and increases they consider, as it happened in January and February of this year. In the case of taxpayers who wish to transfer their contributions directly, they will have to pay the differential between the cost of the coverage and the amount obtained by the company as a result of the contributions.

At the same time, those who start with a job will no longer have to remain in the union social security for one year, but from the first moment they will be able to choose between the prepayment or the aforementioned social security .

This measure is not new, since it was applied during the government of Carlos Saúl Menem, considered by Milei as the best president in the history of the country, until 1998, when a decree made it compulsory to be, at least, 1 year in the social welfare fund of the activity carried out.

In 2001, the Executive Power eliminated the minimum permanence and increased the right to the option.

However, in 2021, former President Alberto Fernandez put the restriction back into effect and, subsequently, the limits to the increase of the social security contributions. These amounts, being well below inflation, generated higher increases in 2024.