Circular Letter of the Financial Services Authority of the Republic of Indonesia Number 2/SEOJK.05/2021 Concerning the Business Plan of Social Security Administrators

To:

1. The Board of Directors of the Social Security Administrator for Health; and
2. The Board of Directors of the Social Security Administrator for Employment,
   In their respective places.

COPY

CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY OF THE REPUBLIC OF INDONESIA NUMBER 2 /SEOJK.05/2021

CONCERNING
BUSINESS PLAN OF SOCIAL SECURITY ADMINISTRATORS

In relation to the mandate of Article 7 paragraph (3), Article 14 paragraph (5), Article 15 paragraph (5), and Article 19 of the Financial Services Authority Regulation Number 24/POJK.05/2019 concerning the Business Plan of Non-Bank Financial Institutions (State Gazette of the Republic of Indonesia Year 2019 Number 175, Additional State Gazette of the Republic of Indonesia Number 6392), it is necessary to regulate the scope of the business plan, the form and structure of the business plan realization report, the form and structure of the business plan supervision report, and the procedures for submission of the business plan, adjustment of the business plan, change of the business plan, business plan realization report, and business plan supervision report of social security administrators in the Financial Services Authority Circular Letter as follows:

I. GENERAL PROVISIONS

In this Circular Letter of the Financial Services Authority, the following terms are meant:

1. Social Security Administrator, hereinafter abbreviated as BPJS, is the Social Security Administrator as referred to in Law Number 24 of 2011 concerning Social Security Administrators, which consists of BPJS Kesehatan and BPJS Ketenagakerjaan.

2. BPJS Kesehatan is a public legal entity established to implement the health insurance program as referred to in Law Number 24 of 2011 concerning Social Security Administrators.

3. BPJS Ketenagakerjaan is a public legal entity established to implement the work accident insurance, old age savings, pension, and death benefit programs as referred to in Law Number 24 of 2011 concerning Social Security Administrators.

4. Social Security Fund, hereinafter abbreviated as DJS, is the trust fund belonging to all participants, which is the collection of contributions plus the results of its development, managed by BPJS for the payment of benefits to participants and the financing of the operational implementation of social security programs as referred to in Law Number 24 of 2011 concerning Social Security Administrators.

5. Board of Directors is the BPJS organ authorized and fully responsible for the management of BPJS for the interests of BPJS, in accordance with the principles, objectives, and principles of BPJS, and representing BPJS, both inside and outside of court, as referred to in Law Number 24 of 2011 concerning Social Security Administrators.

6. Board of Supervisors is the BPJS organ tasked with supervising the implementation of BPJS management by the Board of Directors and providing advice to the Board of Directors in the implementation of social security programs, as referred to in Law Number 24 of 2011 concerning Social Security Administrators.

7. Business Plan is a written document describing the development plan and business activities of BPJS within a certain period, as well as strategies to realize such plans in accordance with the set targets and timeframes.

8. Annual Work and Budget Plan, hereinafter abbreviated as RKAT, is a planning and budgeting document referring to the strategic plan of the social security program as regulated in Government Regulations concerning the Management of Health Social Security Assets and Government Regulations concerning the Management of Employment Social Security Assets.

9. Business Plan Realization Report is a report prepared by the Board of Directors regarding the realization of the Business Plan up to a certain period.

10. Business Plan Supervision Report is a report from the Board of Supervisors regarding the results of supervision concerning the implementation of the Business Plan up to a certain period.

II. SCOPE OF THE BUSINESS PLAN

1. The Scope of the Business Plan must contain at least:
   a. executive summary; b. evaluation of the implementation of the Business Plan of the previous period;
   c. vision, mission, and business strategy;
   d. policies and management plans, including:

1. business activity plans;
2. plans for development or expansion of business activities;
3. investment plans;
4. capital plans;
5. financing plans;
6. plans for the development and/or change of office networks or distribution channels;
7. plans for organizational development, human resources, and/or information technology.
   e. projected financial statements along with the assumptions used; f. projected ratios and specific items; and g. other information.

2. The executive summary as referred to in item 1 letter a contains an introduction explaining the background of the preparation of the Business Plan, which includes among others:
   a. strategic plans and steps to be taken by BPJS in the short term period of 1 (one) year, medium term period of 3 (three) years, and long term period of 5 (five) years; b. key financial indicators; and
   c. determination of annual performance achievements.

3. Evaluation of the implementation of the Business Plan of the previous period as referred to in item 1 letter b contains explanations regarding:
   a. main points of realization or achievement of the Business Plan of the previous period; b. obstacles and problems faced by BPJS; and
   c. matters that BPJS has done to overcome such obstacles and problems.

4. Vision, mission, and business strategy as referred to in item 1 letter c contains explanations regarding:
   a. vision, which is the goal BPJS wants to achieve in the long term; b. mission, which is the method used in the short or medium term to achieve the vision;
   c. business strategy, which is the strategy to achieve the vision and mission, including among others the determination of strategies and policy directions of BPJS in order to achieve the vision and mission of BPJS and face the dynamics of society in the future;
   d. risk analysis of matters that can hinder efforts to achieve annual performance targets; and e. matters that will be the main focus in the planned year.

5. Business activity plans as referred to in item 1 letter d item 1) contain explanations regarding the implementation plan of programs which must at least include:
   a. plans for the implementation of DJS programs; b. plans for the management of BPJS funds; and
   c. plans for activities in support of government programs.

6. Plans for the development or expansion of business activities as referred to in item 1 letter d item 2) are efforts by the social security administrator in terms of service and expansion of coverage.

7. Investment plans as referred to in item 1 letter d item 3) are investment plans for BPJS funds and DJS which must at least include:
   a. the amount of investment funds; b. details of investment instruments;
   c. investment returns; and
   d. outsourcing of investment management to investment managers.

8. Capital plans as referred to in item 1 letter d item 4) must at least include:
   a. the amount and details of capital, including surplus allocation; and b. plans for the receipt and use of operational funds for general and capital expenditures.

9. Financing plans as referred to in item 1 letter d item 5) are plans for DJS financing activities presented in projected financial statements, which must at least include:
   a. plans for contribution receipts and benefit payments on DJS; and b. plans for fulfilling DJS financing in the event of a deficit.

10. Plans for the development and/or change of office networks or distribution channels as referred to in item 1 letter d item 6) must at least include:
    a. the number and details of office networks; b. plans for opening regional offices, pioneer branch offices, and branch offices;
    c. plans for changing the addresses of the head office, regional offices, pioneer branch offices, and branch offices;
    d. plans for closing regional offices, pioneer branch offices, and branch offices; and e. plans for other distribution networks.

11. Plans for organizational development, human resources, and/or information technology as referred to in item 1 letter d item 7) must at least include:
    a. organizational development plans, including among others:

1. plans for the formation of work units/divisions;
2. plans for the change of work units/divisions;
3. plans for the formation of committees; and
4. plans for remuneration.
   b. human resources development plans, including among others:
5. plans for fulfilling human resources:
   a) recruitment plans; b) plans for the appointment and dismissal of employees; c) plans for the use of consultants and/or advisors; d) plans for the use of contract workers; and e) plans for fulfilling human resources in order to optimize claim verification and audit.
6. human resources education and training plans:
   a) plans for human resources education and training needs; and b) plans for human resources education and training costs/budgets;
7. plans for the use of foreign workers; and
8. plans for the utilization of outsourced labor.
   c. Information technology development plans are plans for the development and procurement of information technology, including information regarding the costs of development and maintenance of information technology, including among others:
9. significant changes to the configuration of information technology or core BPJS applications;
10. procurement of new core applications;
11. cooperation with information technology service providers; and
12. other information technology development and procurement that can mitigate BPJS risks, describing the information technology or applications currently used by BPJS and the targeted information technology or application development plans by BPJS. This development and procurement of information technology includes among others the digitalization of claim processing or verification, digitalization of contributions and benefits, and specifically for BPJS Kesehatan including health facility consultations.

12. Projected financial statements along with the assumptions used as referred to in item 1 letter e must at least include:
    a. assumptions used in preparing the projected financial statements, including:

1. macro assumptions including among others:
   a) gross domestic product growth; b) exchange rates; c) interest rates; d) inflation rates; and e) assumptions used in the calculation of the cost increase of medical devices and medicines, specifically for BPJS Kesehatan.
2. micro assumptions including among others:
   a) investment growth; b) investment returns or yields; c) growth in contribution receipts; and d) growth in benefit payments for programs. b. information regarding the financial condition of BPJS, including:
3. projected balance sheets, for DJS including:
   a) for BPJS Kesehatan covering health insurance; and b) for BPJS Ketenagakerjaan covering work accident insurance, death benefits, and unemployment benefits.
4. projected balance sheets of BPJS;
5. projected net asset statements, for DJS including:
   a) for BPJS Kesehatan covering health insurance; and b) for BPJS Ketenagakerjaan covering old age savings and pensions.
6. projected statements of changes in net assets, for DJS including:
   a) health insurance for BPJS Kesehatan; and b) old age savings and pensions for BPJS Ketenagakerjaan.
7. projected activity statements, for DJS including:
   a) for BPJS Kesehatan covering health insurance; and b) for BPJS Ketenagakerjaan covering work accident insurance, death benefits, and unemployment benefits.
8. projected comprehensive income/loss statements or financial performance reports of BPJS;
9. projected Health Level ratios, for DJS and BPJS;
10. projected cash flow statements of BPJS;
11. projected cash flow statements, for DJS including:
    a) for BPJS Kesehatan covering health insurance; and b) for BPJS Ketenagakerjaan covering work accident insurance, death benefits, and unemployment benefits.
12. statements of changes in BPJS equity.

13. Other information as referred to in item 1 letter g must at least include information on other extraordinary events that need to be reported because they affect the business activities of BPJS, but are not yet included in the scope of the BPJS Business Plan as referred to in items 1 to 12 above.

14. In preparing the Business Plan, BPJS may use the format and structure of the RKAT that has been used by BPJS so far, with the provision that it must at least contain the scope of the Business Plan as referred to in items 1 to 13.

15. The Business Plan containing:
    a. key financial indicators in the executive summary as referred to in item 2 letter b; b. business activity plans as referred to in item 5;
    c. plans for the development or expansion of business activities as referred to in item 6;
    d. investment plans as referred to in item 7; e. capital plans as referred to in item 8; f. financing plans as referred to in item 9; g. projected financial statements along with the assumptions used as referred to in item 12, is presented:

1. for actual positions at the end of September of the year the Business Plan is prepared;
2. for projections at the end of December of the year the Business Plan is prepared; and
3. for projections 1 (one) year ahead presented quarterly.

16. The Business Plan containing:
    a. business activity plans as referred to in item 5; b. plans for the development or expansion of business activities as referred to in item 6;
    c. investment plans as referred to in item 7;
    d. capital plans as referred to in item 8; e. financing plans as referred to in item 9; f. plans for the development and/or change of office networks or distribution channels as referred to in item 10; g. plans for organizational development, human resources, and/or information technology, also contains descriptions regarding:

1. the reasons or considerations used by BPJS in preparing the aforementioned plans; and
2. the strategies of BPJS to realize the aforementioned plans.

III. FORM AND STRUCTURE OF THE BUSINESS PLAN REALIZATION REPORT AND BUSINESS PLAN SUPERVISION REPORT

1. The Business Plan Realization Report includes:
   a. explanations regarding the achievement of the Business Plan, namely the comparison between the plan and the realization of the Business Plan; b. explanations regarding deviations in the realization of the Business Plan, namely explanations regarding the causes and obstacles of the deviation between the plan and the realization of the Business Plan;
   c. follow-up actions on the achievement of the Business Plan, namely follow-up efforts that have been and will be carried out to improve the realization achievement of the Business Plan;
   d. financial ratios and specific items; and e. other information, which among others contains information that needs to be reported because it affects the realization of the Business Plan, including other extraordinary event information, but not yet included in the scope of the Business Plan Realization Report as referred to in letters a to d.

2. The Business Plan Realization Report is prepared in accordance with the form and structure using Format 1 as contained in the Appendix which is an integral part of this OJK Circular Letter.

3. The Business Plan Supervision Report must at least contain the assessment of the Board of Supervisors regarding:
   a. the realization of the Business Plan both quantitatively and qualitatively; b. factors affecting BPJS performance;
   c. efforts to improve BPJS performance; and
   d. the appointment and evaluation of public accountants.

4. The Business Plan Supervision Report is prepared in accordance with the form and structure using Format 2 as contained in the Appendix which is an integral part of this OJK Circular Letter.

IV. PROCEDURES FOR SUBMISSION OF THE BUSINESS PLAN, ADJUSTMENT OF THE BUSINESS PLAN, CHANGE OF THE BUSINESS PLAN, BUSINESS PLAN REALIZATION REPORT, AND BUSINESS PLAN SUPERVISION REPORT

1. BPJS must submit the Business Plan, adjustment of the Business Plan, change of the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report to the Financial Services Authority online through the Financial Services Authority's data communication network system.

2. BPJS is required to ensure that the Business Plan, adjustment of the Business Plan, change of the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report submitted online as referred to in item 1 are true and identical to the printed documents (hardcopy) of the Business Plan.

3. In the event that the Financial Services Authority's data communication network system as referred to in item 1 is not yet available or experiences technical disturbances, the submission of the Business Plan, adjustment of the Business Plan, change of the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report is submitted to the Financial Services Authority offline by:
   a. being handed over directly; or b. being sent through a courier service company.

4. In the event of technical disturbances as referred to in item 3, the Financial Services Authority announces this through the Financial Services Authority website.

5. The submission of reports offline as referred to in item 3 must be submitted in electronic data format (softcopy) using media in the form of a compact disc (CD) or other electronic data storage media.

6. The submission of reports as referred to in item 5 must be accompanied by a cover letter in printed form (hardcopy) signed by the Board of Directors.

7. The submission of the cover letter and the Business Plan, adjustment of the Business Plan, change of the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report offline as referred to in item 3 is addressed to:
   a. for BPJS Kesehatan:
   Executive Head of Insurance, Pension Fund, Financing Institutions, and Other Financial Service Institutions Supervision Financial Services Authority attn: Director of Insurance and BPJS Kesehatan Supervision Wisma Mulia 2 Building, 12th Floor Jalan Jenderal Gatot Subroto Kav. 40 Jakarta 12710; b. for BPJS Ketenagakerjaan:

This copy is in accordance with the original
Director of Legal Affairs 1
Legal Department signed
Mufli Asmawidjaja
Executive Head of Insurance, Pension Fund, Financing Institutions, and Other Financial Service Institutions Supervision Financial Services Authority attn: Director of Pension Fund and BPJS Ketenagakerjaan Supervision Wisma Mulia 2 Building, 12th Floor Jalan Jenderal Gatot Subroto Kav. 40 Jakarta 12710

8. In the event of a change in the address of the Financial Services Authority office for the submission of reports as referred to in item 7, the Financial Services Authority conveys notification regarding the address change via letter or announcement.

9. BPJS is deemed to have submitted the Business Plan, adjustment of the Business Plan, change of the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report with the following provisions:
   a. for online submission through the Financial Services Authority's data communication network system, proven by a receipt from the Financial Services Authority's data communication network system; or b. for offline submission, proven by a receipt from the Financial Services Authority.

V. CLOSING

The provisions in this Circular Letter of the Financial Services Authority shall take effect on the date of determination.

Determined in Jakarta on January 15, 2021

EXECUTIVE HEAD OF INSURANCE,
PENSION FUND, FINANCING INSTITUTIONS, AND
OTHER FINANCIAL SERVICE INSTITUTIONS SUPERVISION FINANCIAL SERVICES AUTHORITY, REPUBLIC OF INDONESIA, signed RISWINANDI

APPENDIX

CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY OF THE REPUBLIC OF INDONESIA NUMBER 2 /SEOJK.05/2021

CONCERNING
BUSINESS PLAN OF SOCIAL SECURITY ADMINISTRATORS

Format 1: Business Plan Realization Report

a. Filled with explanations regarding the achievement of the Business Plan, namely the comparison between the plan and the realization of the Business Plan which must at least include:

1. realization of business activity plans as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
2. realization of plans for the development or expansion of business activities as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
3. realization of investment plans as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
4. realization of capital plans as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
5. realization of financing plans as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
6. realization of plans for the development and/or change of office networks or distribution channels as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;
7. realization of plans for organizational development, human resources, and/or information technology as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority; and
8. realization of projected financial statements along with the assumptions used as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority;

b. Filled with explanations regarding deviations in the realization of the Business Plan, namely explanations regarding the causes and obstacles of the deviation between the plan and the realization of the Business Plan.

c. Filled with follow-up actions on the achievement of the Business Plan, namely follow-up efforts that have been and will be carried out to improve the realization achievement of the Business Plan.

d. Filled with financial ratios and specific items including explanations regarding the realization of financial ratios and specific items as referred to in the scope of the Business Plan in this Circular Letter of the Financial Services Authority.

e. Filled with explanations regarding the achievement of plans contained in the other information section in the Business Plan and the comparison of the plan and its realization, which among others contains information that needs to be reported because it affects the realization of the Business Plan, including other extraordinary event information, but not yet included in the scope of the Business Plan Realization Report as referred to in letters a to d.

Board of Directors: (signature and full name)
Board of Directors: (signature and full name) and so on... and so on...

This copy is in accordance with the original
Director of Legal Affairs 1
Legal Department signed
Mufli Asmawidjaja

Format 2: Business Plan Supervision Report

(filled with the Board of Supervisors' assessment regarding the implementation of the Business Plan, consisting of quantitative and qualitative assessments of the realization of the Business Plan, factors affecting BPJS performance, efforts to improve BPJS performance, and the appointment and evaluation of public accountants)

Approved by:
Board of Supervisors: (signature and full name) Board of Supervisors: (signature and full name) and so on... and so on...

Determined in Jakarta on January 15, 2021

EXECUTIVE HEAD OF INSURANCE,
PENSION FUND,
FINANCING INSTITUTIONS, AND
OTHER FINANCIAL SERVICE INSTITUTIONS SUPERVISION FINANCIAL SERVICES AUTHORITY REPUBLIC OF INDONESIA, signed RISWINANDI