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Costa Rica

Updated by Victoria Giroud-Castiella on 14.03.2014

Costa Rica has a long tradition in the development of social policies. The democratic and civic values of this country without an army allowed it to allocate an increasing amount of resources to social development, leading to significant improvements in its human development indicators. Primary education was declared universal in the nineteenth century and social security was introduced in the 1940s. Over several decades, the Costa Rican social security system has evolved into one of the most developed of Latin America. Today, the country has an extensive network of social programmes that make up a social protection floor aimed at guaranteeing basic rights to individuals over their entire life cycle.

The Costa Rican Social Security Fund (Caja Costarricense de Seguro Social, CCSS), created in 1943, is the government institution responsible for social protection. It manages the general social security schemes, as well as non-contributory pensions and other social services programmes. Two of the contributory schemes managed by the CCSS stand out: the Health Insurance, which guarantees complete health protection to the whole population, and the Disability, Old Age, and Death Insurance. Apart from the general social security scheme, there are two pension schemes that operate independently from the general CCSS system: one for the judiciary and one for teachers, which have conditions of access and benefits that differ from the general system’s. The strategic importance given to universal social security services in the country combines with selective policies to provide care for the poorest and most vulnerable population. In the 1970s, the Joint Social Welfare Institute (Instituto Mixto de Ayuda Social, IMAS) and the Social Development and Family Allowances Fund (Fondo de Desarrollo Social y Asignaciones Familiares, FODESAF) were created with the purpose of protecting these disadvantaged population groups. Among the many selective and assistive policies available in the country, there are initiatives to support children by guaranteeing access to food, education, and social assistance in general. A few of these stand out: the school canteen programme, the Education and Nutrition Centres and Comprehensive Child Care Centres (Centros de Educación y Nutrición - Centros Infantiles de Atención Integral, CEN-CINAI), the IMAS subsidy programme, the Avancemos programme, support for the purchase of school supplies and for school transportation, non-contributory pensions, and the IMAS subsidy programme for the elderly.

Although segmentation, caused by a differentiated access to health services according to income, age, location, and ethnicity, prevails in Latin America, one of the most relevant characteristics of the Costa Rican health insurance is its universal character: health care covered by the Sickness and Maternity Insurance (Seguro de Enfermedad y Maternidad, SEM) or Health Insurance is equitably provided by law to all of the insured, whether they contribute or not. In 1984, the government insurance system was established to guarantee the supportive inclusion of poor families in the general scheme of the social health insurance. The universal health social protection floor was thereby consolidated, one of the country’s greatest achievements in terms of social policy.

The National Pension System is made up of four pillars: a basic non-contributory assistance pillar, primarily aimed at the elderly living in poverty; a contributory solidarity social insurance pillar which is collectively financed; a complementary and compulsory individual savings scheme; and a voluntary complementary pillar.

The Costa Rican mixed pension system has characteristics that are unique in the Latin American region, since all of the insured are registered both with the social security pension insurance and with the compulsory complementary pension scheme. Statistics place Costa Rica, along with Uruguay and Chile, in the top three countries in terms of coverage of the economically active population. It is estimated that the contributory and non-contributory pensions cover more than 60 per cent of people of retirement age.

The institutionalization of social policy, the promotion of universal policies in health, social security, education, housing, and basic services, as well as sustained long-term economic growth, have led to a better sustainability of human development. This is evident in the significant achievements in the reduction of infant mortality, the increase in life expectancy, and the reduction in poverty, which decreased from 50 per cent of households in 1950 to 20 per cent by the end of the twentieth century. However, according to an Economic Commission for Latin America and the Caribbean (ECLAC) report, the Costa Rican social protection system could face several challenges, as evidenced by the stagnation of its poverty indicators.