Social Security in Panama, an observers perspective

In my post titled “Reflections upon a return to Boquete” I stated.

” It fascinates me that in Panama workers can have a month off from work each year, that Social Security in a third world country can cover medical care and medicines. Agreed the system is flawed, it is imperfect, but I have friends working solely so they can get medical insurance in the US.”

This section prompted some comments about Social Security in Panama. In my statement I did say “the system is flawed” it is but it is better than the working poor have had in much of the US in the past, it is possibly better for many in the US now with new Affordable Healthcare changes.

I want further explore the good and the bad about Panamanian Medical Care, public and private. All that I will write about the Public system is anecdotal, I have personal experience only with the private system.

In Panama workers pay about 10% of gross earnings into Social Security,  more than the 6.2% employee contribution in the US. Employers in both countries also pay about the same amount as employees. In the US Social Security only covers retirement, Medicare is separate and partially covers healthcare for those over 65, who often need to purchase supplemental insurance to fill the holes in Medicare. In Panama Social Security covered both medical care for them and their families, as well as retirement. Employees can, if they wish, also purchase private health insurance.

Panama has three parallel systems, often with the the same doctors crossing between public and private. Anyone can pay for healthcare in either the private or public system. The public system includes a network of clinics and hospitals operated by both the Ministry of Health (MINSA) and the Caja de Seguro Social (CSS). Anyone can use either system and if they are covered by Social Security, care is free. Care is not always available, medicines are not always available, many procedures require long waits. The last part sounds a lot like what I hear from Canadians about their system.

CSS Regional David

CSS Regional David

My experience with the public system is listening to friends, both expat and native who have used it and some first hand observations. I have been in the CSS Regional Hospital in David as a visitor, not a patient. In two circumstances where people were in immediate need of attention, one a serious motorcycle accident, the other a stroke, the CSS system worked as designed. They were triaged and admitted quickly and received in their words, very good care. In another that spanned both the public and private system, Papa Ricco and his hernia.  Ricco had surgery in Hospital Chiriqui, private, and after having complications and infection he went to the CSS Regional in David. Rico, shortly before his death in a traffic accident, told me he thought the care he received in CSS Regional was good and they did not ask for payment, which was minimal, until he left.

I have interviewed doctors and nurses who work for both MINSA and CSS, they all say the same thing. They do their best with inadequate facilities and too many patients. I have been in consultations with doctors in their private offices and when an expensive test of procedure is discussed they ask if I am eligible for Social Security in Panama. They try to move some of the major costs into the public system. I again know from anecdotal experience that in a non life threatening procedure or test, the wait can be brutal, that makes sense with limited resources and priorities of triage.

My employee has Social Security, I pay it. I have driven his mother to the clinic in Boquete and to the CSS regional hospital in David. She would have no healthcare without his Social Security; something is certainly better than nothing. The system on paper is excellent, the system in practice is inadequate for the population and needs of the country.

Waiting room at CSS David

Waiting room at CSS David

In my time in the US, I needed emergency room care for myself and others at times. I preferred University Hospital at the University of Arizona. They had some of the best doctors in the city and in some specialties some of the best in the country. Waiting in the emergency room was often a long tedious event unless you could convince a nurse that life was in immediate danger, waiting for a doctor in a clinic either public or private here in Panama is no worse. I have spend hours waiting for routine appointments in Hospital Chiriqui, a private hospital. I have also been treated in minutes in the same facility in an emergency.

If you put my observations into a summary, they system here is perfect, on paper, imperfect in execution. On paper, workers and their families have healthcare and retirement covered by payments made by themselves and their employers into Social Security. Everyone who qualifies for underwriting has an option to buy either national or international private health insurance, if they can afford it. If people are not able to qualify for Social Security and cannot afford or qualify for health insurance they can use the public system at a low cost.

If you need to use the public system you need to have an angel (please read this post by Don Ray), a Spanish Speaking advocate to push your priority or you might indeed die in the waiting room because of the lack of staff, facilities and inability to communicate. But I am not so sure this is different in a public hospital in other countries including the US.

Since my knowledge is limited to my experience, I welcome more comments from others who read this and have had experience in the Public healthcare system. I know there will be both positive and negative experiences, that is inevitable. Medicine is imperfect and although we all hope for a positive outcome,  ultimately we all meet our maker, just best when it is not premature.


  1. Susan Guberman-Garcia says:

    Hi Lee, thanks for the article and the link to Don Ray’s article. I have no personal experience with the CSS hospitals in Panama, but my employees have and I hear from other locals a lot of things. From what I hear, the government is cutting costs by cutting services, particularly in the “provinces.” It takes 90 days to get the results of a mammogram. Gall bladder surgery is no longer covered under CSS unless you come in with an emergency (rupture or massive infection) as an emergency case. Public funds in Panama are increasingly being limited to things that benefit elites (who don’t use the public hospitals). Postal services are being cut in some areas, public utilities are deteriorating, public transportation is a mess, but funds that could be used for these purposes are instead going to fancy new office buildings for elites, sweetheart contracts (like the $250K “web designer” contract for the ombudsman) and into pol pockets. Its a shame….

  2. Penny Ripple says:

    Lee….this is not the first time I have heard of a patient getting an infection in Chiriqui Hospital. Is this a serious issue? Is Mae Lewis any better? I have had 3 family members in the US die of ultimately what was diagnosed as “treatment of the hospital”. Staph infections, dehydration, etc. Seems we all need to use preventive measures and stay away from doctors and hospitals whenever possible. Ironic, huh?

  3. I’ve had good care with doctors from both Chiriqui and Mae Lewis (only one speaks English but I’m studying Spanish with a teacher) and my surgery care at Chiriqui was fine. I don’t understand your “workers have a month off”? I pay my helper her “thirteenth” month, which is one/third of a month’s salary three times a year (plus time and a half on holidays). Is that what you meant?

  4. Decimo payments (“thirteenth month”) is in addition to a month’s vacation, to which workers are entitled.

  5. Aren’t fancy office buildings private investments? Which fancy office building for the elite was built by the Panamanian government? Public transportation is a mess? Well, thank the government for building a Metro in Panama city. Or maybe the Metro is for the elite, too?

  6. Dan Porter says:

    Skywriter908 – Actually, I believe Lee was referring to the fact that the workers get 30 days paid vacation for every 11 months of continuous employment. This is in addition to the “thirteenth month” rule that you mentioned.

    Most people are amazed that they get 30 days paid vacation, plus 12 national holidays off (not paid) and then get an extra month of salary (thirteenth month) paid in three installments a year. Sounds great, doesn’t it. So much “time off” and extra pay. It’s not and here is why:

    In comparison, the
    Panamanians standard work week per year is 2496 hours
    48 hours per week * 52 weeks
    Americans standard work week per year is 2080 hours
    40 hours per week * 52 weeks

    Right away you can see that the Panamanian work week is 416 hours more per year. But what about all those paid vacation days?,

    If you make all of the adjustments for vacation time, extra pay, national holidays (paid and non-paid) etc. you find that over a year’s time the Panamanian labor system works 272 hours (34 days) more per year than the American labor system and gets paid for 336 hours for those 272 hours of actual work.

  7. “Postal services are being cut in some areas, public utilities are deteriorating.” Sounds just like the good ol’ U.S. of A. Panama is not unique.

  8. Carlton says:

    Thanks Sir. I have been married to a woman from Panama’ for a couple decades now, (I think it’s going to work out 😉 and have always wondered about the social services in Panama since my wife’s C-section procedure for our daughter ($300) back in 1991. I suspect that, in addition to the 10% investment by citizens, there is probably an additional sum of revenue from other sources such as foreign investments, taxes on the wealthy (elite?), etc. It’s not perfect, even in theory, but it does seem to run a little more efficiently than the social services monster in the EEUU. Government run services, regardless of the service, will always run less efficiently to some degree than a private endeavor, simply because the motivation is not there to do so. Thanks for your many blog postings, I will continue to read them for when we decide to finally settle in Panama’… probably somewhere near the city.

  9. Hey, I just want to clarify something Dan mentioned. His math here is seriously flawed. Panama’s standard of working hours per week is no way near 48, 48 hours means 6 days working 8 hours straight which nobody does unless it’s a special worker (in the Panama Canal for example) occasionally covering someone else or just people that want extra money.

    Public employees work 5 days a week from 9am to 4pm. That’s 7 hours per day which is 35 hours per week. Now, the private sector is a bit different, I’d say most companies have 45 working hours per week. Which is 5 full days and saturdays until 1pm but there’re quite a few that work only 5 days.

    I’d say 1 in 4 private companies work 40 hours per week, the rest do 45 but all public offices work 5 days and 1 hour less than normal. So, I would say the average is around 40-42 hours per week or maybe less, hard to tell.

    Plus, you’re using 52 weeks when we only work 48.

    42*48 = 2016

    Not to mention that we have paid holidays, not sure where you got that information because they’re all paid except maybe a Carnival saturday which you choose to compensate working beforehand if you really want to have it.

  10. Dan Porter says:

    Ahh temp, I should have shown my work. For the sake of discussion, let me clarify…

    While you may not know people working 48 hours a week they are all around you. Most of the restaurants, hotels, casinos etc all work their employees 48 hours a week. I know this from personal experience and working along side of them on a daily basis. Panama does not pay overtime until after 8 hours per day or 48 hours per week – hence the standard work week is 48 hours. 6 days of work and 1 day of rest. That was the point of my post – many people do not realize they work 6 days straight. The labor law is very interesting here and a big surprise to most. I have no doubt there are public employees that work less hours but by law the work week is 48 hours.

    (insert joke about non working public employees here!)

    As for the math, I started both at 365 days and then deducted downward. True that you take away 4 weeks for the paid vacation but you also take away 2 weeks paid vacation for the average US worker.

    Below were my actual calculations:

    Panamanians standard work week per year is 2496 hours
    48 hours per week * 52 weeks
    Americans standard work week per year is 2080 hours
    40 hours per week * 52 weeks

    Panamanians get one month of paid vacation
    2496 hours – (4 * 48) = 2304 hours of actual work
    (4 weeks of 48 hours each week paid vacation)

    Americans get two weeks (on average) of paid vacation
    2080 hours – (2 * 40) = 2000 hours of actual work
    (2 weeks of 40 hours each week paid vacation)

    Adjusting for national holidays
    Panamanians get 12 days of non-paid time off
    2304 hours – (12*8) = 2208 hours of actual work
    Americans get 8 days of paid national holidays
    2000 hours – (8*8) = 1936 hours of actual work but paid for 2064
    1936 hours of actual work
    2064 hours of actual pay

    Lastly Panamanians get an extra month of pay (thirteenth month)
    2208 hours of actual work
    2400 hours of actual pay

    Panamanians work 272 hours more per year
    Panamanians get paid for 336 hours more per year

    You think your Panamanian worker looks a little tired, now you know why…
    Think your Panamanian worker has it easy with month paid vacation… not really.

  11. “Americans standard work week per year is 2080 hours
    40 hours per week * 52 weeks”

    HA HA HA!

  12. Fair enough Dan. You went straight to the source, I did check our legislation and yes, it says 48 hours and I think this should be revisited since even other countries in Central America have 44 hours or less as a maximum without paying overtime.

    That being said, I don’t think it’s fair to use it as a reference. We both know that’s not the average, it would make sense to use it in the US because frankly who would pay you to work less than that there?

    Here things are a bit different, a lot of professionals work 45, 40 or 35 hours per week. People without education (and some with degrees) are the ones getting screwed by this, no doubt.

    But if you want to base your theories on ALL working panamanians then the maximum should not be used, it should be the average, I’m not sure if there’re statistics about this but yeah, it’s not 48…at all.

  13. Dan Porter says:

    Agreed, it is not “all” Panamanians. It is some and more than most realize. Trying to find a basis for comparison, one must start with the labor laws and then make adjustments. Until Panama changes the law, there will be a good portion of the workforce that has no option but to work 6 days and longer hours.

    I would agree that your average office worker probably works less. I have not doubt that the average public servant works less . However, I would also say that many if not most of the ones in the service oriented business, such as your waitress, cook, hotel maid etc, all have no choice and are told that is the law.

    Next time you are out having dinner, ask the waiter or waitress how many days a week they work. Like everything in Panama, it is an eye opener.

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