Introduction to the IMSS and its Seguros
The Instituto Mexicano del Seguro Social (IMSS) is a crucial social security organization in Mexico, providing coverage for formal workers and their families against various eventualities such as illnesses, maternity, invalidity, old age, advanced-age unemployment, and death. The IMSS comprises five types of insurance: Work Risks (SRT), Illnesses and Maternity (SEM), Invalidity and Life (SIV), Retirement, Advanced-Age and Old Age Unemployment (SRCV), and Daycare and Social Benefits (SGPS).
Current Financial Situation and Projected Deficit
According to actuarial projections by the IMSS, as outlined in their report to the Federal Executive and Congress of the Union on the financial situation and risks of IMSS (2024-2025), the obligatory regime’s deficit is currently 882,996 million pesos or 2.4% of Mexico’s national GDP. However, under a high-risk scenario, this deficit could swell to 3 billion pesos or 8.4% of the national GDP by 2054.
Reasons for the Projected Deficit
The projected deficit is primarily due to a reduction of 1.4 billion pesos in the IMSS insurance income over the next 30 years, combined with an increase of 790 million pesos in expenses. The IMSS highlighted that this worst-case scenario assumes fewer formal jobs, less average cotization days per worker, and a lower number of people with savings in their housing subaccount. Additionally, retirees are expected to live longer, further straining the system.
Impact on Seguros
- SEM (Illnesses and Maternity): The SEM saw the most significant income drop due to a decrease in average cotization days for working individuals, resulting in a 1.1 billion pesos reduction.
- SIV (Invalidity and Life): The SIV experienced the largest expense increase, with a 0.46 billion pesos rise, caused by modified interest rates for constitutive amounts and a smaller number of individuals with housing resources eligible for pensions.
Hospital Bed Shortage
The IMSS reported having only 0.69 hospital beds per 1,000 beneficiaries by the end of 2024, which falls short of the international recommendation of at least one bed per 1,000 beneficiaries. To meet the recommended target, an estimated investment of 413 billion pesos is needed for 17,324 additional beds.
Key Questions and Answers
- What is the IMSS? The Instituto Mexicano del Seguro Social (IMSS) is a vital social security organization in Mexico, offering coverage for formal workers and their families against various risks.
- What causes the projected deficit? The deficit is primarily due to reduced insurance income and increased expenses, assuming fewer formal jobs, less cotization days, and longer retiree lifespans.
- Which IMSS Seguros are most affected? The SEM (Illnesses and Maternity) and SIV (Invalidity and Life) insurance types face the most significant impact due to income reductions and expense increases, respectively.
- What is the hospital bed situation in IMSS? The IMSS has fewer hospital beds than the international recommendation, requiring an estimated 413 billion pesos investment for additional beds.
