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39 C Job: 1702431 39ª reunión - París, 2017 39 C/45 20 de octubre de 2017 Original: francés Punto 10.5 del orden del día provisional INFORME DE AUDITORÍA DE LA CAJA DE SEGUROS MÉDICOS Y EL SERVICIO MÉDICO DE LA UNESCO Resumen De conformidad con la cláusula 12.6 del Reglamento Financiero, el Auditor Externo presenta su informe de auditoría de la Caja de Seguros Médicos y el Servicio Médico de la UNESCO. La síntesis de dicho informe y el comentario de la Directora General figuran en el documento 202 EX/32 Parte III. Tras examinar el informe de auditoría de la Caja de Seguros Médicos y el Servicio Médico de la UNESCO, el Consejo Ejecutivo adoptó la siguiente decisión (decisión 202 EX/32.III): El Consejo Ejecutivo, 1. Recordando la resolución 38 C/90, 2. Habiendo examinado los documentos 202 EX/32 Parte III y 202 EX/32.INF.3, 3. Expresa su satisfacción al Auditor Externo por la elevada calidad de su informe; 4. Invita a la Directora General a dar cuenta de la marcha de la aplicación de las recomendaciones que figuran en el documento 202 EX/32 Parte III en el marco de su informe sobre el seguimiento del conjunto de las recomendaciones formuladas por el Auditor Externo; 5. Decide transmitir a la Conferencia General, en su 39ª reunión, los documentos 202 EX/32 Parte III y 202 EX/32.INF.3 y la presente decisión.

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39 C

Job: 1702431

39ª reunión - París, 2017

39 C/45 20 de octubre de 2017 Original: francés

Punto 10.5 del orden del día provisional

INFORME DE AUDITORÍA DE LA CAJA DE SEGUROS MÉDICOS Y EL SERVICIO MÉDICO DE LA UNESCO

Resumen

De conformidad con la cláusula 12.6 del Reglamento Financiero, el Auditor Externo presenta su informe de auditoría de la Caja de Seguros Médicos y el Servicio Médico de la UNESCO. La síntesis de dicho informe y el comentario de la Directora General figuran en el documento 202 EX/32 Parte III.

Tras examinar el informe de auditoría de la Caja de Seguros Médicos y el Servicio Médico de la UNESCO, el Consejo Ejecutivo adoptó la siguiente decisión (decisión 202 EX/32.III):

El Consejo Ejecutivo,

1. Recordando la resolución 38 C/90,

2. Habiendo examinado los documentos 202 EX/32 Parte III y 202 EX/32.INF.3,

3. Expresa su satisfacción al Auditor Externo por la elevada calidad de su informe;

4. Invita a la Directora General a dar cuenta de la marcha de la aplicación de lasrecomendaciones que figuran en el documento 202 EX/32 Parte III en el marco de suinforme sobre el seguimiento del conjunto de las recomendaciones formuladas por elAuditor Externo;

5. Decide transmitir a la Conferencia General, en su 39ª reunión, los documentos202 EX/32 Parte III y 202 EX/32.INF.3 y la presente decisión.

39 C/45 Anexo I

ANEXO I

Job: 1701586

202 EX/32 Parte III

Consejo Ejecutivo

París, 4 de septiembre 2017 Original: francés

Punto 32 del orden del día provisional

NUEVAS AUDITORÍAS DEL AUDITOR EXTERNO

PARTE III – SÍNTESIS

INFORME DE AUDITORÍA DE LA CAJA DE SEGUROS MÉDICOS Y EL SERVICIO MÉDICO DE LA UNESCO

RESUMEN

El presente documento es la síntesis que el Auditor Externo hace de su informe de auditoría sobre la Caja de Seguros Médicos y el Servicio Médico de la UNESCO, que figura en el documento 202 EX/32.INF.3, de conformidad con la cláusula 12.6 del Reglamento Financiero.

Medida que se prevé adopte el Consejo Ejecutivo: decisión propuesta en el párrafo 55.

202a reunión

202 EX/32 Parte III

RESUMEN EJECUTIVO

INFORME DE AUDITORÍA DE LA CAJA DE SEGUROS MÉDICOS Y EL SERVICIO MÉDICO DE LA UNESCO

NOTA: el presente resumen ejecutivo ha sido elaborado por el Auditor Externo a petición de la Secretaría a fin de optimizar los costos de traducción y facilitar los debates de los órganos rectores. Únicamente el informe íntegro da fe del contenido exacto, la índole y el alcance de las observaciones y recomendaciones del Auditor Externo. 1. Gobernanza de la Caja de Seguros Médicos

1. La Secretaría presentó a la Conferencia General, en su reunión de noviembre de 2013, un proyecto de reforma del reglamento de la Caja, que la Conferencia General aprobó en su resolución 37 C/85. Ulteriormente, esa versión entró en vigor mediante la circular administrativa AC/HR/43 del 21 de octubre de 2014 y fue aclarada en la circular informativa IC/HR/73 del 3 de noviembre de 2014.

2. La circular AC/HR/43 acaba de ser anulada por los fallos nº 3761 y 3762 pronunciados el 8 de febrero de 2017 por el Tribunal Administrativo de la Organización Internacional del Trabajo (TAOIT), a raíz de los recursos interpuestos por varios jubilados de la UNESCO que fueron miembros del Consejo de Administración de la CSM y desean preservar el carácter mutualista de la gestión de la Caja. En efecto, el Tribunal comprobó que el Reglamento había sido enmendado sin que se respetara el procedimiento previsto para su modificación, ya que la Asamblea General de los afiliados a la CSM, en su reunión extraordinaria del 4 de septiembre de 2013, no había aceptado las modificaciones propuestas.

3. Estos fallos acarrean las siguientes consecuencias, teniendo en cuenta que las decisiones del TAOIT no son apelables:

− privan de base jurídica a las instancias (el Consejo Consultivo, el Coordinador de la CSM y el experto externo especializado) establecidas en cumplimiento de la circular administrativa AC/HR/43 que ha sido anulada;

− no permiten volver automáticamente a las anteriores modalidades de gobernanza, aprobadas en 2008, ya que ello supondría, entre otras cosas, la supresión del Consejo Consultivo antes mencionado y su sustitución por el Consejo de Administración de la Caja, del cual tres miembros deben ser designados por la Directora General y los otros tres miembros y sus suplentes deben ser elegidos por la Asamblea General de afiliados, de conformidad con la versión de 2008 del Reglamento;

− debilitan las decisiones adoptadas desde la difusión de las circulares de 2014, que podrían ser objeto de recursos en los que se invoque el carácter ilegal de los procedimientos aplicados para su adopción, en particular las tres modificaciones del Reglamento de la Caja y el cambio de las bases de cálculo de las cotizaciones de seguro médico de los funcionarios de alto nivel de la UNESCO adoptadas en 20161;

− por último, obligan a la UNESCO a reflexionar sobre las normas de gobernanza de la CSM: ¿hay que volver a la versión de 2008 del Reglamento, o reformarla, como preconizaba la empresa consultora Deloitte? Si se opta por una reforma, ¿qué nueva versión del Reglamento se habrá de proponer y qué argumento deberá presentarse a la Asamblea General de afiliados para convencerla de la legitimidad de esta reforma?

1 A este respecto, la Secretaría señala que se debe llevar a cabo un análisis jurídico exhaustivo para evaluar la

amplitud de los riesgos.

202 EX/32 Parte III – pág. 2

4. Se propone volver a la versión anterior (2008) del Reglamento de la Caja, complementándola en lo que respecta a los dos elementos siguientes:

− obligando a la CSM a hacer evaluar periódicamente por un actuario la evolución a largo plazo de sus recursos y obligaciones, a fin de prever el riesgo de que se produzca un nuevo déficit; se incluyó una disposición de esta índole en la versión de 2014 del Reglamento, pero aún no se ha aplicado por motivos financieros;

− creando un procedimiento de urgencia que permita a la Directora General adoptar medidas de emergencia para hacer frente al riesgo de desequilibrio financiero en las cuentas de la Caja señalado por los actuarios de esta última, a propuesta de HRM y BFM.

5. La existencia de un procedimiento de este tipo podría incitar a los órganos paritarios de la Caja (el Consejo de Administración y la Asamblea General de afiliados) a adoptar rápidamente las decisiones necesarias, para que este procedimiento no se aplique. De hecho, en el pasado esos órganos no rechazaron los aumentos de cotizaciones que resultaron necesarios, en particular el último, decidido en 2011 y efectivo desde el 1º de enero de 2012.

Recomendación Nº 1. A raíz de los fallos del Tribunal Administrativo de la Organización Internacional del Trabajo que anularon las circulares de 2014 mediante las que se modificaron las modalidades de gobernanza de la Caja de Seguros Médicos, el Auditor Externo recomendó a la UNESCO que determinara con urgencia una posición relativa a las modalidades de gobernanza de la Caja y la presentara a la Conferencia General.

2. Organización administrativa de la Caja de Seguros Médicos

6. Desde 2009, dos entidades se encargan de la gestión cotidiana de la Caja: la Oficina de Pensiones y Seguros de la Oficina de Gestión de Recursos Humanos (HRM/SPI) y una empresa que desempeña la función de administrador externo contratado mediante licitación por un periodo de tres años.

7. El administrador externo (la empresa MSH desde el 1º de enero de 2017) se encarga de la gestión de los reembolsos de gastos médicos. En breve pondrá a disposición de los beneficiarios una red de atención médica. Recibe las solicitudes de reembolso del personal junto con las facturas de los profesionales de la salud y establecimientos médicos, comprueba su validez con la ayuda de su director médico y reembolsa los gastos a los funcionarios interesados en función de las tarifas que figuran en el anexo III del Reglamento de la Caja.

8. La duración de tres años prevista para los contratos de administrador externo es conforme al punto 7.7 del Manuel Administrativo, que permite la concertación de acuerdos “a largo plazo” de una duración de uno a cuatro años. Por ello, se debe volver a someter el contrato a licitación con frecuencia, atendiendo, en principio, al interés financiero de la Organización. No obstante, su brevedad presenta inconvenientes para el personal en caso de cambio de titular, como acaba de ocurrir.

9. En efecto, la transferencia de los expedientes de Cigna (el anterior administrador) a MSH dio lugar a retrasos en los reembolsos de gastos, que la Asociación Internacional del Personal de la UNESCO (AIPU) denunció en un comunicado de fecha 7 de marzo de 2017, difundido en el sitio Intranet de la Organización. Ya se habían producido retrasos similares en el pasado, con motivo del nombramiento de un nuevo administrador.

10. Estos retrasos se deben particularmente a fallos en la transmisión de los expedientes de los asegurados de un administrador externo a otro. Una prolongación de la duración de los contratos de los administradores externos permitiría en el futuro atenuar esas dificultades. El establecimiento de contratos por un periodo de cuatro años sería conforme a la duración máxima de los acuerdos a largo plazo prevista en el punto 7.7 del Manual Administrativo. El establecimiento de contratos de

202 EX/32 Parte III – pág. 3

cinco o seis años de duración supondría una exención de las disposiciones antes citadas, lo que es jurídicamente posible.

Recomendación Nº 2. El Auditor Externo recomienda estudiar la posibilidad de extender la duración de los contratos del administrador externo de la Caja, a fin de limitar los retrasos en los pagos que se observan al principio del mandato de un nuevo administrador externo.

11. En la actualidad, la Caja administra un plan básico de seguro médico que los funcionarios de la UNESCO tienen la libertad de complementar o no con un plan complementario de su elección.

12. En una cláusula de la licitación para la renovación del administrador externo se preveía de forma opcional proponer a la UNESCO un plan de seguro médico complementario y facultativo. En efecto, la existencia de un plan complementario vinculado al plan básico obligatorio agilizaría el reembolso de los gastos, puesto que los miembros del personal ya no se verían obligados a recurrir primero al plan básico y en segundo lugar a su plan complementario, si lo hubiere.

13. Por otra parte, ello permitiría garantizar con mayor seguridad a los centros hospitalarios que reciben a los asegurados de la UNESCO el reembolso íntegro de sus gastos. En efecto, cuando los funcionarios en activo que no están afiliados a ninguna mutua de seguros no consiguen reembolsar la parte de sus gastos que no está cubierta por la CSM, esta paga por adelantado la totalidad del tratamiento costoso o la hospitalización, y luego recupera ese importe deduciendo las cuantías correspondientes de los sueldos de sus funcionarios. Sin embargo, no puede aplicar este procedimiento y deducir esas cuantías en el caso de los jubilados, cuyas pensiones son abonadas por la Caja Común de Pensiones del Personal de las Naciones Unidas. Esta situación es una de las causas de las dificultades con que tropiezan los administradores externos de la CSM en sus trámites con los hospitales de París (AP-HP).

14. Los candidatos respetaron esta cláusula de la licitación, y MSH, que obtuvo el contrato, propuso el establecimiento de un plan complementario de esta índole en la oferta que presentó en julio de 2016 y que fue aceptada, en lo relativo al mandato de administrador externo, el 22 de septiembre de 2016.

15. No obstante, desde esa fecha continúan las discusiones entre HRM/SPI, MSH y la aseguradora ALLIANZ.

Recomendación Nº 3. El Auditor Externo recomienda acelerar la negociación del plan complementario de seguro médico propuesto mediante una licitación que concluyó en septiembre de 2016.

3. Organización administrativa del Servicio Médico

16. Existe cierto desfase entre los textos en los que se definen los cometidos del Servicio Médico y las funciones reales que cumple dicho servicio.

17. El Servicio Médico cumple tres cometidos sin base reglamentaria: la función de médico asesor que controla la legitimidad de los tratamientos médicos reembolsados por la Caja, la prevención y los reconocimientos médicos que se conceden a los miembros de las delegaciones ante la UNESCO y de otras organizaciones internacionales.

18. Además de las funciones definidas en la cláusula 5.5 del Reglamento de la Caja, el Médico Jefe de la Organización presta asesoramiento a la Caja sobre los tratamientos costosos cuyo importe se aproxima al límite máximo de reembolso de gastos médicos previsto en el anexo III del Reglamento de la CSM. Esta función, que no está prevista en el Reglamento de la Caja, se comparte con el director médico de MSH.

202 EX/32 Parte III – pág. 4

19. La práctica de doble examen por el servicio médico de la CSM y el de MSH de las solicitudes de reembolso de los cuidados onerosos constituye una garantía de la calidad del servicio. No obstante, esta práctica es costosa, puesto que obliga a la UNESCO a sufragar a la vez su servicio médico y el de MSH (que ha incluido el coste de su directora médica y de las enfermeras que la asisten en la tarifa que factura a la UNESCO para el desempeño de sus funciones, esto es, 22,50 euros por mes y por asegurado).

20. Por lo tanto, la Organización debería reflexionar sobre la conveniencia de esta situación y sacar conclusiones para el futuro. Tres soluciones alternativas son lógicamente concebibles:

− encomendar explícitamente al Servicio Médico de la UNESCO la tarea de tramitar todos los casos de cuidados costosos y complejos y retirar esta misión al administrador externo dentro de tres años, cuando se someta nuevamente su contrato a licitación, lo que debería dar lugar a una reducción del coste de dicho contrato;

− avalar y formalizar la situación actual, facultando al Servicio Médico de la UNESCO para controlar todas las propuestas del servicio médico de MSH en materia de reembolso de cuidados costosos o complejos;

− ceñirse a la reglamentación actual y al contrato firmado con MSH y respetar esos textos, es decir, dejar al servicio médico de MSH la tramitación de los casos costosos y complejos y solicitar la intervención del Servicio Médico de la UNESCO únicamente en caso de reclamación por parte de los usuarios o de la CSM; esta solución, que parece la más lógica, permitiría al Servicio Médico reducir el tiempo de trabajo de uno de sus médicos y aumentar sus actividades de prevención, por ejemplo.

Recomendación Nº 4. El Auditor Externo recomienda que se lleve a cabo una reflexión sobre la distribución idónea de las tareas entre el Servicio Médico de la UNESCO y el del administrador externo de la CSM y se apliquen las consecuencias jurídicas modificando, de ser necesario, el Reglamento de la CSM y las funciones del administrador externo del plan de seguro médico.

21. En el artículo 10 del punto RH 7.2 del Manual de Recursos Humanos, en el que se definen las funciones del Servicio Médico, solo figuran disposiciones muy parciales en materia de prevención (“d) administrar o hacer administrar las vacunas e inoculaciones necesarias con motivo de misiones oficiales y cada vez que la Organización lo estime necesario”).

22. En la práctica, el Servicio Médico realiza las actividades de prevención enunciadas a continuación, además de las vacunaciones: presta asesoramiento a los funcionarios antes de sus misiones (o con motivo de cualquier visita), lleva a cabo campañas de detección de enfermedades, publica mensajes en el sitio Intranet de la Organización (Unescommunity) y organiza consultas sistemáticas para los funcionarios que cambian de puesto (medida menos costosa que la realización de frecuentes reconocimientos médicos).

23. Para que las normas coincidan con la práctica, se recomienda a continuación (recomendación Nº 8) la formulación de una verdadera política de prevención y la inclusión en la reglamentación de las medidas previstas en dicha política.

24. El Servicio Médico presta una “atención médica regular” no solo a los miembros del personal, sino también a los miembros de las delegaciones ante la UNESCO (pero no a sus cónyuges e hijos); esta práctica, que no está prevista en la reglamentación de la UNESCO, no corresponde a la de las otras organizaciones internacionales que conoce el Auditor Externo.

202 EX/32 Parte III – pág. 5

25. Dos organizaciones internacionales, a saber, el Programa de las Naciones Unidas para el Medio Ambiente (PNUMA) y el Banco de Desarrollo del Consejo de Europa (CEB2), encomiendan a la UNESCO la realización de sus reconocimientos médicos estatutarios (exámenes médicos previos a la contratación de personal, visitas de control en caso de baja médica, etc.). Estas consultas no se contemplan en el Manual de Recursos Humanos, pero han sido objeto de convenciones y se facturan a esas dos organizaciones aplicando tarifas distintas (80 euros por consulta en el caso del CEB y 90 euros en el caso del PNUMA). Por consiguiente, parece necesario actualizar la tarifa aplicada al CEB.

26. El Servicio Médico mantiene actualizadas listas digitalizadas de las personas a las que recibe, lo que le permite saber a qué categorías de beneficiarios pertenecen, pero el software utilizado no permite extraer estadísticas en función de la condición de esas personas. Estima que el 70% de esas visitas corresponden a funcionarios permanentes, el 20% a personas con contratos temporales, consultores, pasantes y representantes de otras organizaciones internacionales y el 10% a miembros de delegaciones (el 80% en el caso de la enfermería de Miollis, que se sitúa muy cerca de las oficinas de las delegaciones).

27. Por lo tanto, convendría regularizar la situación, ya sea dejando de autorizar a los miembros de las delegaciones a recibir asesoramiento médico y atención médica regular, o fijando y aplicando una tarifa para esas prestaciones.

28. A fin de cumplir sus funciones de asesoramiento médico y “atención médica regular”, el Servicio Médico recurre a sus dos médicos que trabajan a tiempo completo (entre ellos el jefe del servicio) y a varios médicos especialistas que realizan sustituciones a lo largo del año. Esos médicos suplentes son remunerados por el Servicio Médico, pero sus prestaciones son gratuitas para el personal de la UNESCO y los miembros de las delegaciones. El recurso a un médico del trabajo es conforme a las facultades otorgadas al servicio en el Manual de Recursos Humanos para realizar los exámenes médicos que la Organización exige, como se indica en el punto 13.12 del Manual.

29. No obstante, el recurso a médicos especialistas suplentes resulta difícil de entender, ya que no corresponde a las funciones asignadas al servicio en el Manual, ya se trate de la orientación, la atención médica de emergencia o la “atención médica regular”, y el personal de la UNESCO puede obtener el reembolso de la atención psiquiátrica y ginecológica prestada por un médico de su elección. El Servicio Médico considera que esas consultas psiquiátricas y ginecológicas constituyen una forma de medicina preventiva, pero en el Manual se le confieren muy pocas facultades en este ámbito.

30. De hecho, el Servicio Médico había propuesto en 2012 que esas consultas especializadas se facturaran a una tarifa moderada (20 euros, monto inferior al de las consultas de los médicos locales reembolsadas por la CSM, que en aquel momento oscilaban alrededor de 30 euros) y que la CSM las reembolsara a los pacientes, en el caso del personal de la UNESCO. Convendría estudiar de nuevo esta solución que no se había adoptado en aquel momento, debido a su complejidad.

Recomendación Nº 5. El Auditor Externo recomienda que se supriman o se cobren las prestaciones del Servicio Médico que actualmente se ofrecen gratuitamente y sin base jurídica (las visitas médicas de todo tipo y consultas de médicos especialistas ofrecidas a los miembros de delegaciones, exceptuando los casos de urgencia, y las consultas de médicos especialistas ofrecidas a los miembros del personal, cuando estos pueden obtener el reembolso de esas consultas por la Caja de Seguros Médicos.

2 Council of Europe Development Bank (CEB).

202 EX/32 Parte III – pág. 6

4. Reciente evolución de la situación financiera de la Caja de Seguros Médicos y el Servicio Médico

31. La reciente evolución de la situación financiera de la Caja (2012-2016) es positiva, ya que el producto de las cotizaciones supera sistemáticamente el de los reembolsos de gastos médicos y el monto de las reservas de la CSM representa ahora 17 o 18 meses de gastos, o sea, una cuantía igual o superior a la norma que BFM considera conveniente (entre 15 y 18 meses de gastos).

32. Esta evolución, que contrasta con los cuatro años de déficit registrados de 2008 a 2011, se debe al aumento del índice de las cotizaciones que financian la Caja, decidido por la Conferencia General en su 36ª reunión, en octubre de 2011, y aplicado desde el 1º de enero de 2012.

33. El presupuesto y los gastos reales del Servicio Médico, por su parte, están disminuyendo, habida cuenta de las dificultades financieras de la Organización.

5. Reformas que podrían mejorar la sostenibilidad financiera a largo plazo de la Caja de Seguros Médicos

a) Recurso sistemático a estudios actuariales sobre la evolución financiera a largo plazo de la CSM

34. Para garantizar la sostenibilidad financiera a largo plazo de un plan de pensiones o un plan de seguro médico, la primera medida que conviene tomar es pedir a una empresa de actuarios que evalúe periódicamente la evolución futura de los ingresos, los gastos y el saldo del plan y, si constituye reservas, la evolución de los activos del plan.

35. Es de lamentar que la Caja no haya podido seguir encargando este tipo de evaluaciones desde 2010, pese a que, en su reglamento, desde su modificación en 2014, se prevé la contratación de un experto externo para prestar servicios relativos al análisis actuarial y financiero de la Caja.

Recomendación Nº 6. El Auditor Externo recomienda que se lleven a cabo evaluaciones actuariales periódicas de la evolución financiera a largo plazo de la Caja de Seguros Médicos, a fin de poder detectar los riesgos de déficit y de agotamiento de las reservas de la Caja con suficiente antelación para adoptar de forma oportuna las medidas que permitan remediar la situación.

b) Financiación de las obligaciones a largo plazo

36. De conformidad con las IPSAS, la Organización presenta en sus estados financieros sus obligaciones por concepto de prestaciones al personal. Puesto que la UNESCO no cuenta con un sistema de pensiones propio, ya que su personal depende de la Caja Común de Pensiones del Personal de las Naciones Unidas, las obligaciones más importantes corresponden al derecho al reembolso de los gastos médicos de sus jubilados actuales o futuros.

37. Habida cuenta de que estas obligaciones se incrementan muy rápido, el Auditor Externo recomendó la financiación del seguro médico después de la separación del servicio para compensar estas obligaciones, a fin de reducir sus repercusiones en el estado de la situación financiera de la Organización.

38. La Directora General propuso que se dedujera el 1% de los gastos de personal y se asignara la cuantía deducida, estimada en 4 millones de dólares estadounidenses para el bienio 2014-2015, a una Cuenta Especial para el seguro médico después de la separación del servicio, con objeto de constituir una reserva destinada a sufragar los gastos futuros que originen las prestaciones del seguro médico después de la separación del servicio.

202 EX/32 Parte III – pág. 7

39. Esta propuesta fue aprobada por la Conferencia General en su 38ª reunión, en noviembre de 2015, y complementada por una transferencia de 2,1 millones de dólares estadounidenses del presupuesto ordinario a la Cuenta Especial y por una deducción del 4% de los sueldos de los funcionarios afiliados a la CSM y financiados mediante fondos extrapresupuestarios. Los fondos de la Cuenta Especial ascendían a 7 803 354 dólares estadounidenses al 31 de diciembre de 2016, o sea, el 1,02% del importe de las obligaciones por concepto de seguro médico después de la separación del servicio al 31 de diciembre de 2016.

40. El Auditor Externo recomendó, en su informe de 2016 sobre la situación financiera de la Organización al 31 de diciembre de 2015, que esta continuara aplicando las medidas adoptadas para el bienio 2016-2017 durante los bienios ulteriores y elaborara “una estrategia de financiación que permita garantizar la sostenibilidad de esta deuda a largo plazo”, determinando el nivel idóneo que la Cuenta Especial para el seguro médico después de la separación del servicio debería alcanzar y adoptando medidas complementarias para lograr este objetivo.

41. La Secretaría aún no ha propuesto una meta precisa, ni ha adoptado medidas adicionales para complementar los ingresos de la Cuenta Especial. Sería aconsejable que fijara un porcentaje de las obligaciones por concepto de seguro médico después de la separación del servicio que se hayan de cubrir con activos y pidiera a un actuario la estimación de la fecha en que se alcanzará ese objetivo. El Auditor Externo seguirá formulando recomendaciones relativas a este asunto en sus informes anuales sobre la situación financiera de la Organización.

c) Reforma de la reglamentación

42. En los informes de Buck Consultants (2001) y Deloitte (2011) se propusieron varias reformas que podrían generar ahorros para la Caja y que no se han llevado a cabo, tras su examen por grupos de trabajo especializados, por los motivos siguientes: la escala de gastos médicos de la UNESCO es generalmente menos ventajosa para los asegurados que la de las demás organizaciones internacionales; los efectos concretos de algunas de las medidas propuestas parecieron demasiado limitados (por ejemplo, la reducción del 90% al 80% del porcentaje de reembolso de los gastos relativos a la reproducción asistida, los dispositivos médicos y los honorarios de los médicos de hospitales propuesta por Deloitte solo habría permitido ahorrar unos 14 000 dólares estadounidenses por año para cada una de esas medidas).

43. No obstante, convendría definir con mayor precisión dos aspectos particulares de la reglamentación de la CSM y del Servicio Médico.

44. En la cláusula 2.3 del Reglamento de la CSM no se determina una duración mínima de afiliación de los hijos de los asegurados. Actualmente, pues, un asegurado puede afiliar a su hijo a la CSM por un breve periodo, inferior a un año, para que la Caja reembolse los gastos de una operación, y darlo de baja una vez que se haya realizado la operación para volver a afiliarlo a otro régimen de seguro médico al que tiene derecho. Por lo tanto, la determinación de un periodo mínimo de afiliación, de 12 meses, por ejemplo, permitiría evitar tales abusos.

45. En el Reglamento de la CSM no se ha previsto una disposición relativa a la prevención de los riesgos para la salud de los asegurados. Asimismo, el artículo 10 del punto RH 7.2 del Manual de Recursos Humanos citado en el anexo, en el que se definen las funciones del Servicio Médico, solo contiene disposiciones muy parciales al respecto.

46. Conviene estudiar la formulación de una política de prevención, que debería ser objeto de una definición precisa en la reglamentación de la Caja o del Servicio Médico.

202 EX/32 Parte III – pág. 8

Recomendación Nº 7. El Auditor Externo recomienda que se reexaminen las normas relativas a la afiliación a la Caja de los hijos a cargo de los asegurados.

Recomendación Nº 8. El Auditor Externo recomienda que se formule una política de prevención y se prevean en el reglamento las prestaciones que se hayan de ofrecer en cumplimiento de esa política.

d) Respeto adecuado de la prohibición de autorizar excepciones al reglamento de la CSM:

47. Las comprobaciones realizadas por el equipo de auditoría interno en los locales de MSH mostraron una buena organización del proceso de reembolso de los gastos médicos y del control interno de dicho proceso por esta empresa. En una muestra de 37 expedientes, el equipo de auditoría solo detectó un error parcial.

48. Sin embargo, se observó que se habían concedido algunas excepciones, aunque están expresamente prohibidas en virtud de la cláusula 7.2 del Reglamento de la CSM, en la que se estipula que “no se concederá excepción alguna al presente reglamento, cualquiera que sea la parte interesada”.

49. La Secretaría debería llevar a cabo una reflexión sobre las medidas necesarias para que se respete la prohibición de autorizar excepciones al reglamento financiero. En principio, podrían adoptarse tres métodos: recordar esta prohibición mediante una circular en la que se indique que los funcionarios que autoricen excepciones se verán sancionados; modificar el reglamento para autorizar excepciones en casos particulares, sometiéndolas a un procedimiento específico (como un examen por una comisión especial y la adopción de la decisión final por la Directora General); renunciar al sistema de autoseguro existente y confiar la responsabilidad de las decisiones de gestión cotidiana de la CSM a una compañía de seguros.

Recomendación Nº 9. El Auditor Externo recomienda que se adopten las medidas más adecuadas para que se respete la prohibición de autorizar excepciones al reglamento de la CSM.

6. Reformas que podrían mejorar el funcionamiento de la Caja

50. Como se indicó más arriba, la Asociación Internacional del Personal de la UNESCO (AIPU) se ha quejado de los retrasos observados en el reembolso de las prestaciones desde la entrada en servicio del nuevo administrador.

51. Esta situación se explica por la insuficiente información facilitada a MSH para liquidar las prestaciones y por la falta de claridad de algunos puntos de la reglamentación, que MSH no siempre ha interpretado del mismo modo que su antecesor, Cigna.

52. Los problemas que surgieron a la hora de aplicar la reglamentación atañen en particular a los casos enumerados a continuación, que dieron lugar a intercambios de cartas con los asegurados, lo que ralentizó el procedimiento:

− las normas relativas a las lentes ópticas y de contacto eran distintas en la versión inglesa y la versión francesa del Reglamento de la CSM;

− MSH no ha aceptado sufragar los gastos de taxi de los pacientes que salen de una hospitalización, ya que en el reglamento solo se prevén traslados médicos en ambulancia;

− se deben definir más precisamente las normas relativas al reembolso de las curas termales, la parte de los honorarios médicos que no está cubierta por la CSM, los tratamientos especiales (B3), los fisioterapeutas (B2), según se paguen por acto o por sesión.

202 EX/32 Parte III – pág. 9

53. Se armonizaron las versiones inglesa y francesa del Reglamento. Convendría proporcionaruna interpretación oficial de los puntos poco claros, posiblemente modificando la redacción delreglamento para aclararla.

Recomendación Nº 10. El Auditor Externo recomienda que se aclaren los puntos ambiguos del reglamento de la CSM, proporcionando una interpretación oficial o modificando la redacción del texto para que quede más claro.

54. Para asegurar una tramitación más rápida de las solicitudes de reembolso, sería ademásconveniente que los asegurados pudieran presentar la totalidad de sus solicitudes en línea,escaneando todos los comprobantes, mientras que la versión actual del reglamento los obliga aproporcionar los documentos originales. Una modificación del reglamento parece aconsejable a esterespecto.

Recomendación Nº 11. El Auditor Externo recomienda que se estudie una modificación del Reglamento de la CSM para acelerar el reembolso de los gastos médicos, aceptando que se transmitan en línea los comprobantes escaneados, al menos para los gastos que no rebasen cierto nivel de reembolso.

Decisión propuesta

55. El Consejo Ejecutivo podría adoptar una decisión del siguiente tenor:

El Consejo Ejecutivo,

1. Recordando la resolución 38 C/90,

2. Habiendo examinado los documentos 202 EX/32 Parte III y 202 EX/32.INF.3,

3. Expresa su satisfacción al Auditor Externo por la elevada calidad de su informe;

4. Invita a la Directora General a dar cuenta de la marcha de la aplicación de lasrecomendaciones en el marco de su informe sobre el seguimiento del conjunto de lasrecomendaciones formuladas por el Auditor Externo;

5. Decide transmitir a la Conferencia General, en su 39ª reunión, los documentos202 EX/32 Parte III y 202 EX/32.INF.3 y la presente decisión.

Observaciones de la Directora General

La Directora General agradece al Auditor Externo su informe de auditoría sobre la Caja de Seguros Médicos y el Servicio Médico de la UNESCO. Acepta el conjunto de las recomendaciones formuladas e informará sobre los avances logrados en su aplicación de conformidad con el procedimiento habitual. Desea, no obstante, destacar la recomendación 5, con respecto a la cual se proporcionan comentarios detallados en respuesta a la cuestión planteada.

Detalles en el anexo.

202 EX/32 Part III Annex

ANNEX

PRELIMINARY IMPLEMENTATION PLAN BY RECOMMENDATION

Audit recommendations Preliminary implementation plan and comments The recommendation will require additional

resources for implementation

(YES/NO)

Estimated date for the implementation

of the recommendation

Recommendation No. 1. Following the judgments of the International Labour Organization Administrative Tribunal repealing the 2014 circulars, which modified the governance of the Medical Benefits Fund, the External Auditor recommends that UNESCO take a position, as a matter of urgency, on the governance arrangements for the Fund that should be adopted and proposed to the General Conference.

Accepted. The Secretariat will continue internal discussions and will implement the appropriate governance mechanisms, while taking into account the recent ILOAT judgement.

Yes 01.01.2018

Recommendation No. 2. The External Auditor recommends examining the possibility of extending the duration of the Fund’s external administrators’ contracts to limit delays in payment at the beginning of the

Accepted in order to ensure continuity in the management of the Fund.

No 30.06.2019

202 EX/32 Part III Annex – page 2

Audit recommendations Preliminary implementation plan and comments The recommendation will require additional

resources for implementation

(YES/NO)

Estimated date for the implementation

of the recommendation

term of office of each new external administrator.

Recommendation No. 3. The External Auditor recommends accelerating negotiations for the complementary health insurance plan proposed in the call for tenders concluded in September 2016.

Accepted. No 31.12.2017

Recommendation No. 4. The External Auditor recommends that consideration be given to the proper division of labour between the UNESCO Medical Service and the MBF’s external administrator, and legal conclusions be drawn by modifying, if necessary, the Rules of the MBF and the tasks of its external administrator.

Accepted. In particular, prevention functions should be included in the terms of reference of the Chief Medical Officer (CMO).

No 31.12.2017

Recommendation No. 5. The External Auditor recommends dispensing with or charging for the services provided by the

The recommendation is accepted. However, it does not appear easy in practice to charge for the medical consultations and appointments with specialists.

No 30.06.2018

202 EX/32 Part III Annex – page 3

Audit recommendations Preliminary implementation plan and comments The recommendation will require additional

resources for implementation

(YES/NO)

Estimated date for the implementation

of the recommendation

Medical Service that are currently provided without a legal basis and free of charge (medical checks of all types and consultations of specialist doctors offered to members of delegations outside emergency cases and specialist consultations offered to staff members, as the latter may be reimbursed for such consultations by the Medical Benefits Fund).

Recommendation No. 6. The External Auditor recommends regular actuarial assessments of the long-term financial development of the Medical Benefits Fund so as to be able to detect sufficiently in advance the risks of deficit and depletion of the Fund’s reserves in order to take the necessary measures in a timely manner to restore the situation.

Accepted Yes 31.12.2017

Recommendation No. 7. The External Auditor recommends re-

Accepted Yes 30.06.2018

202 EX/32 Part III Annex – page 4

Audit recommendations Preliminary implementation plan and comments The recommendation will require additional

resources for implementation

(YES/NO)

Estimated date for the implementation

of the recommendation

examining the rules for registering participants’ dependent children.

Recommendation No. 8. The External Auditor recommends introducing a prevention policy and defining in the rules the services to be carried out in accordance with this policy.

Accepted No 31.12.2017

Recommendation No. 9. The External Auditor recommends that the most appropriate measures be taken to ensure compliance with the rule prohibiting the granting of exceptions to the MBF Rules.

Accepted No 31.12.2017

Recommendation No. 10. The External Auditor recommends that the obscure points of the MBF Rules be clarified by providing an official interpretation or by amending the wording of the Rules for clarification.

Accepted No 30.06.2018

202 EX/32 Part III Annex – page 5

Audit recommendations Preliminary implementation plan and comments The recommendation will require additional

resources for implementation

(YES/NO)

Estimated date for the implementation

of the recommendation

Recommendation No. 11. The External Auditor recommends that consideration be given to amending the MBF Rules to expedite the reimbursement of healthcare expenses by allowing online submission of scanned supporting documents, at least below a certain reimbursement amount.

Accepted Yes 30.06.2018

202 EX/32 Partie III Annexe I

ANNEXE I

PLAN PRÉLIMINAIRE DE MISE EN ŒUVRE PAR RECOMMANDATION

Recommandations de l’audit

Plan préliminaire de mise en œuvre et observations

L’application de la recommandation nécessitera des

ressources supplémentaires

(OUI/NON)

Date estimée de l’application de la recommandation

Recommandation n° 1. À la suite des jugements du Tribunal administratif de l’Organisation internationale du travail annulant les circulaires de 2014 qui ont modifié les modalités de gouvernance de la Caisse d’assurance-maladie, l’auditeur externe recommande à l’UNESCO d’arrêter d’urgence une position relative aux modalités de gouvernance de la Caisse qu’il convient d’adopter et de la proposer à la Conférence générale.

Acceptée. Le Secrétariat continuera ses discussions internes et mettra en œuvre les mécanismes de gouvernance appropriées tout en tenant compte du récent jugement du TAOIT.

Oui 01.01.2018

Recommandation n° 2. L’auditeur externe recommande d’étudier la possibilité d’une extension de la durée des contrats de l’administrateur extérieur de la Caisse, pour limiter les retards

Acceptée afin d’assurer une continuité dans la gestion de la caisse.

Non 30.06.2019

202 EX/32 Partie III Annexe I – page 2

Recommandations de l’audit

Plan préliminaire de mise en œuvre et observations

L’application de la recommandation nécessitera des

ressources supplémentaires

(OUI/NON)

Date estimée de l’application de la recommandation

de paiement constatés au début du mandat d’un nouvel administrateur extérieur.

Recommandation n° 3. L’auditeur externe recommande d’accélérer la négociation du régime complémentaire d’assurance-maladie proposé par un appel d’offres qui s’est conclu en septembre 2016.

Acceptée. Non 31.12.2017

Recommandation n° 4. L’auditeur externe recommande de réfléchir à la bonne répartition des tâches entre le service médical de l’UNESCO et celui de l’administrateur extérieur de la CAM et en tirer les conséquences juridiques en modifiant, si nécessaire, le règlement de la CAM et les missions de l’administrateur extérieur du régime d’assurance-maladie.

Acceptée. Il faudra notamment intégrer les missions de prévention dans les termes de référence du CMO.

Non 31.12.2017

Recommandation n° 5. L’auditeur externe recommande d’abolir ou de

La recommandation est acceptée. Toutefois, il ne semble pas facile en pratique de rendre payantes les consultations et les consultations spécialisées.

Non 30.06.2018

202 EX/32 Partie III Annexe I – page 3

Recommandations de l’audit

Plan préliminaire de mise en œuvre et observations

L’application de la recommandation nécessitera des

ressources supplémentaires

(OUI/NON)

Date estimée de l’application de la recommandation

rendre payantes les prestations du service médical données actuellement sans base légale et gratuitement (visites médicales de tous types et consultations de médecins spécialistes offertes aux membres des délégations en dehors des cas d’urgence et consultations de médecins spécialistes offertes aux membres du personnel, alors que ces derniers peuvent se faire rembourser de telles consultations par la Caisse d’assurance maladie).

Recommandation n° 6. L’auditeur externe recommande de procéder à des évaluations actuarielles régulières de l’évolution financière à long terme de la Caisse d’assurance maladie, de façon à pouvoir détecter les risques de déficit et d’épuisement des réserves de la Caisse suffisamment à l’avance pour adopter en temps utile les mesures

Acceptée Oui 31.12.2017

202 EX/32 Partie III Annexe I – page 4

Recommandations de l’audit

Plan préliminaire de mise en œuvre et observations

L’application de la recommandation nécessitera des

ressources supplémentaires

(OUI/NON)

Date estimée de l’application de la recommandation

nécessaires pour rétablir la situation.

Recommandation n° 7. L’auditeur externe recommande de réexaminer les règles relatives à l’inscription à la Caisse des enfants dépendant des assurés.

Acceptée Oui 30.06.2018

Recommandation n° 8. L’auditeur externe recommande de définir une politique de prévention et prévoir dans le règlement les prestations à réaliser en application de cette politique.

Acceptée Non 31.12.2017

Recommandation n° 9. L’auditeur externe recommande prendre les mesures les mieux adaptées pour faire respecter l’interdiction de déroger au règlement de la CAM.

Acceptée Non 31.12.2017

Recommandation n° 10. L’auditeur externe recommande de clarifier les points obscurs du règlement

Acceptée Non 30.06.2018

202 EX/32 Partie III Annexe I – page 5

Recommandations de l’audit

Plan préliminaire de mise en œuvre et observations

L’application de la recommandation nécessitera des

ressources supplémentaires

(OUI/NON)

Date estimée de l’application de la recommandation

de la CAM, en en donnant une interprétation officielle ou en en modifiant la rédaction pour la clarifier.

Recommandation n° 11. L’auditeur externe recommande d’étudier une modification du règlement de la CAM pour accélérer le remboursement des soins, en admettant la fourniture en ligne de pièces justificatives scannées, au moins en –dessous d’un certain montant de remboursement.

Acceptée Oui 30.06.2018

202 EX/32.INF.3 PARIS, 20 September 2017 English & French only

Executive Board

Job: 201701569

Two hundred and second session

Item 32 of the provisional agenda

NEW AUDITS BY THE EXTERNAL AUDITOR

AUDIT REPORT ON THE MEDICAL BENEFITS FUND AND THE UNESCO MEDICAL SERVICE

SUMMARY

Pursuant to Article 12.6 of the Financial Regulations, the External Auditor submits the audit report on the Medical Benefits Fund and the UNESCO Medical Service. The short form of this report and the comments by the Director-General are contained in document 202 EX/32 Part III.

ANEXO II 39 С/45 Annex II

202 EX/32.INF.3

EXTERNAL AUDIT OF THE UNITED NATIONS

EDUCATIONAL, SCIENTIFIC AND CULTURAL ORGANIZATION

AUDIT REPORT ON THE MEDICAL BENEFITS FUND

AND THE UNESCO MEDICAL SERVICE

External Auditor reference: UNESCO-2017-12

(i)

TABLE OF CONTENTS

I. OBJECTIVE AND SCOPE OF THE AUDIT .................................................................... 1

II. SUMMARY OF RECOMMENDATIONS ......................................................................... 2

III. ORGANIZATION OF THE MEDICAL BENEFITS FUNDAND THE MEDICAL SERVICE ...................................................................................... 3

1. Governance of the Medical Benefits Fund ............................................................. 3

2. Administrative organization of the Medical Benefits Fund ...................................... 7

2.1 The Fund is administered with the help of an external and self-insured administrator ....................................................................... 7

2.2 At present the Fund only manages a basic health insurance plan ................. 11

3. Administrative organization of the medical service ................................................. 12

3.1 The functions of the medical service according to the regulations ................. 12

3.2 Functions performed by the Medical Service without a regulatory basis ....... 12

IV. FINANCIAL SITATION OF THE MEDICAL BENEFITS FUNDAND THE MEDICAL CENTRE ....................................................................................... 16

1. Recent financial developments of the Medical Benefits Fundand the Medical Service ......................................................................................... 16

2. Recent financial developments of the Medical Service........................................... 18

3. Long-term financial sustainability of the Medical Benefits Fund ............................. 18

3.1 Observations by consultants ......................................................................... 18

3.2 Establishment of a reserve to offset the Fund’s liabilities with regard to retirees ................................................................................... 23

3.3 Reforms likely to improve the long-term financial sustainability of the Medical Benefits Fund ........................................................................ 24

3.4 Reforms likely to improve the performance of the Fund ................................ 30

V. ACKNOWLEDGEMENTS ............................................................................................... 33

Annex 1 Legal definition of the role of the medical service ................................................... 35

Annex 2 Recommendations by the External Auditor on the funding of UNESCO’s liability for the provision of ASHI ...................................................... 37

Annex 3 Statistics on participants of the MBF as at 31 December 2016 .............................. 39

Annex 4 Organization of the internal oversight of MSH International. The external administrator of the MBF ................................................................... 41

202 EX/32.INF.3

I. OBJECTIVE AND SCOPE OF THE AUDIT

1. In accordance with the notification dated 15 February 2017, a team of two external auditors carried out an assignment at UNESCO from April to June 2017. The objective of this assignment was to examine the Organization, the functions and the financial situation of both the Medical Benefits Fund and UNESCO’s Medical Service in order to assess the appropriateness of the present system and its long-term financial sustainability.

2. This assignment was carried out in the Bureau of Human Resources Management (HRM) and UNESCO’s Medical Service. The auditors also interviewed the Bureau of Financial Management (BFM) and the Office of International Standards and Legal Affairs (LA).

3. The audit was conducted in accordance with the International Standards of Supreme Audit Institutions (ISSAI), established by the International Organization of Supreme Audit Institutions (INTOSAI), and in accordance with applicable texts, in particular Article 12 of the UNESCO Financial Regulations and the Annex on the Additional Terms of Reference Governing the Audit.

4. Each observation and recommendation has been discussed with HRM and the Medical Service. The comments and clarifications provided by the UNESCO Secretariat were taken into consideration when appropriate. This final version of the report was drawn up further to comments made by the UNESCO Secretariat on 17 July 2017.

202 EX/32.INF.3 – page 2

II. SUMMARY OF RECOMMENDATIONS

Recommendation No. 1: Following the judgments of the International Labour Organization Administrative Tribunal repealing the 2014 circulars, which modified the governance of the Medical Benefits Fund, the External Auditor recommends that UNESCO take a position, as a matter of urgency, on the governance arrangements for the Fund that should be adopted and proposed to the General Conference.

Recommendation No. 2: The External Auditor recommends examining the possibility of extending the duration of the Fund’s external administrators’ contracts to limit delays in payment at the beginning of the term of office of each new external administrator.

Recommendation No. 3: The External Auditor recommends accelerating negotiations for the complementary health insurance plan proposed in the call for tenders concluded in September 2016.

Recommendation No. 4: The External Auditor recommends that consideration be given to the proper division of labour between the UNESCO Medical Service and the MBF’s external administrator, and legal conclusions be drawn by modifying, if necessary, the Rules of the MBF and the tasks of its external administrator.

Recommendation No. 5: The External Auditor recommends dispensing with or charging for the services provided by the Medical Service that are currently provided without a legal basis and free of charge (medical checks of all types and consultations of specialist doctors offered to members of delegations outside emergency cases and specialist consultations offered to staff members, as the latter may be reimbursed for such consultations by the Medical Benefits Fund).

Recommendation No. 6: The External Auditor recommends regular actuarial assessments of the long-term financial development of the Medical Benefits Fund so as to be able to detect sufficiently in advance the risks of deficit and depletion of the Fund’s reserves in order to take the necessary measures in a timely manner to restore the situation.

Recommendation No. 7: The External Auditor recommends that the rules for registering participants’ dependent children be re-examined.

Recommendation No. 8: The External Auditor recommends that a prevention policy be introduced and the services to be carried out in accordance with this policy be defined in the rules.

Recommendation No. 9: The External Auditor recommends that the most appropriate measures be taken to ensure compliance with the rule prohibiting the granting of exceptions to the MBF Rules.

Recommendation No. 10: The External Auditor recommends that the obscure points of the MBF Rules be clarified by providing an official interpretation or by amending the wording of the Rules for clarification.

Recommendation No. 11: The External Auditor recommends that consideration be given to amending the MBF Rules to expedite the reimbursement of healthcare expenses by allowing online submission of scanned supporting documents, at least below a certain reimbursement amount.

202 EX/32.INF.3 – page 3

III. ORGANIZATION OF THE MEDICAL BENEFITS FUND AND THE MEDICAL SERVICE

1. Governance of the Medical Benefits Fund

5. Chapter VI of UNESCO’s Staff Rules and Regulations stipulates that the Director-General shall operate a system of social security for the staff, including provisions for thepreservation of health (Staff Regulation 6.2) and that all staff members shall participate in theOrganization’s Medical Benefits Fund in accordance with the conditions laid down in the Rulesof the Fund; (Staff Rule 106.3)

6. The MBF was founded by the General Conference at its 3rd session in 1948. The firstArticle of its Rules stipulates “the basic feature of the Fund is that it is a mutually financed andautonomous health-insurance scheme based on principles of solidarity”.

7. The MBF Rules have been subject to several modifications. Those made in 2008reformed its mode of governance by reinforcing its mutualist nature. In practice, they increasedthe powers of the General Assembly of Participants, hitherto a purely advisory body, inparticular by ensuring that proposed amendments to the main provisions of the Rules were tobe approved by the General Assembly of Participants before being submitted to the Director-General (see Table 1 hereafter).

8. In 2013 and 2014, UNESCO turned the procedure around (see Table 1 hereafter). Inaccordance with 36 C/Resolution 99, adopted by the General Conference, the Director-General was invited to review the governance of the Fund, taking into account therecommendations made by the external consulting firm Deloitte in its report dated 10 July 2012.Deloitte drew up this document in a context of successive annual deficits in the Fund, causingconcern over its long-term sustainability. It recommended simplifying the existing relationsbetween the Fund’s different bodies, increasing the power of the Bureau of Human ResourcesManagement (HRM) and the Bureau of Financial Management (BFM), and attributing a purelyadvisory role to the General Assembly of Participants to be exercised by representatives ofthis assembly within an advisory body.

9. Upon the Director-General’s request, BFM and HRM drew up draft amendments to theMBF Rules in line with Deloitte’s proposals, which empowered the UNESCO Secretariat at theexpense of the General Assembly of Participants. In accordance with the Rules adopted in2008, the draft amendments were submitted to the MBF Board of Management, which modifiedand submitted them to the General Assembly of Participants. The Assembly did not adopt theamended version at its meeting on 4 September 2013 and issued a resolution regretting thedirection the reform had taken, requesting a performance audit of the Fund by the UNESCOExternal Auditor and adjourning the assembly.1

10. The Secretariat submitted to the General Conference at its 37th session in November2013 a slightly altered version of the reform submitted to the General Assembly of Participants,which the General Conference adopted by means of 37 C/Resolution 85. This version thenentered into force by means of Administrative Circular AC/HR/43 of October 2014, for whichan explanation was provided in Information Circular IC/HR/73 of 3 November 2014.2

11. Administrative Circular AC/HR/43 has recently been set aside by Judgment No. 3761and Judgment No. 3762 of the International Labour Organization Administrative Tribunal(ILOAT), dated 8 February 2017, following an appeal lodged by a number of UNESCO retirees,former members of the MBF Board of Management committed to the mutualist nature of theFund. The Tribunal found that the Rules had been amended without the procedure that

1 See document 37 C/38 of 5 November 2013 “The State of the Medical Benefit Fund and introduction of the new governance structure”.

2 See report by Director-General on the state of the MBF, document 38 C/43 dated 12 August 2015.

202 EX/32.INF.3 – page 4

provides for their amendment having been observed, since the MBF’s Extraordinary General Assembly of Participants, held on 4 September 2013, had not accepted the proposed amendments.

12. The judgments have the following consequences, as ILOAT decisions are not subject to appeal:

− they deprive of a legal basis the authorities (Advisory Body, MBF Coordinator and External Subject Matter Expert) established pursuant to annulled Administrative Circular AC/HR/43;

− they do not enable an automatic return to the previous governance arrangements, adopted in 2008, since that would imply in particular the abolition of the aforementioned Advisory Body and its replacement by the MBF Board of Management, for which three members must be designated by the Director-General and the three other members and their alternates must be elected by the General Assembly of Participants,3 in accordance with the 2008 version of the Rules;

− they undermine decisions taken since the 2014 circulars, which might in theory be the subject of appeals invoking the illicit nature of the procedures followed to adopt them, in particular the three amendments to the Fund’s Rules adopted by circular AC/HR/51 published on 8 August 20164 and the change to the bases of calculation of contributions to the Fund by UNESCO’s most senior staff adopted in the circular AC/HR/55 published on 21 December 2016;5

− and lastly, they compel UNESCO to consider the MBF’s rules of governance: should it return to the 2008 version of the Rules, or should it reform them, as advised by the consulting firm Deloitte? If reform is on the cards, how should the Rules be redrafted, and what argument should be presented to the General Assembly of Participants to convince it of the merits of the reform?

13. At the time of the External Auditor’s inquiry, no course of action had been decided. The governance established pursuant to the annulled 2014 circulars were still in force. The Secretariat had executed the ILOAT judgements by paying the indemnities entitled to claimants and participants in accordance with the aforesaid judgements (€5,000 for damages and €500 for “expenses” for each claimant and each judgement6) and had decided to submit the issue of the Fund’s governance to the General Conference at its 39th session in November 2017, but had not yet prepared a text to that end.

14. Given the abovementioned legal risks, the Secretariat must take a position, as a matter of urgency, and propose a solution to the General Conference.

15. The External Auditor is not habilitated to define UNESCO’s position on policy. The following suggestions are to be understood as examples, which could help to make progress in the matter.

3 Such an election by all UNESCO’s present and retired staff, who are dispersed around the world, is a very

drawn-out process lasting a minimum of six months. 4 This circular foresees the removal of Article 4.8 setting out the temporary incapacity plan, and alterations

to both Article 4.13, specifying the sanctions to be applied in the event of fraud, and Article 6.2, specifying the rules for calculating the health insurance contributions for voluntary participants, in particular retirees.

5 On this subject, the Secretariat notes that a thorough legal analysis should be conducted to assess the extent of the risks incurred.

6 The total sum paid for the execution of the two judgements amounted to € 202,000.

202 EX/32.INF.3 – page 5

16. Purely and simply reverting to the 2008 version of the Rules would slow down thedecision-making process in the event of a deterioration in the Fund’s financial situation, sincemeasures taken to redress the situation would be proposed by the joint Advisory Body andsubmitted to, then approved by the General Assembly of Participants before being submittedto the Director-General.

17. It has therefore been suggested that the 2008 version of the Rules should besupplemented with the following two points concerning governance:

− an obligation for the MBF to arrange for a regular7 evaluation by an actuary of the long-term evolution of its resources and commitments so as to anticipate the risk of a deficit recurring; a provision of this type was included in the 2014 version of the Rules8 but has not been implemented on financial grounds;

− the introduction of an emergency procedure enabling the Director-General to take emergency measures that might mitigate a risk of financial imbalance9 in the Fund’s accounts reported by the Fund’s actuaries, at the proposal of the Bureau of Human Resources Management (HRM) and Bureau of Financial Management (BFM).

18. If such a procedure existed, it might encourage the joint bodies of the Fund (Board ofManagement and General Assembly of Participants) to take the necessary decisions rapidly,to ensure that the procedure is not triggered. Moreover, these bodies have not in the pastrejected increases in contributions that have become necessary, in particular the most recentincrease, decided upon in 2011, and applied as of 1 January 2012.

19. For the General Assembly of Participants10 to adhere to such a reform, it seems judiciousto not call into question the mutualist principle of the Fund and to maintain the powers ascribedto the General Assembly of Participants in 2008, with the exception of the aforesaid provisionsfor the compulsory hiring of an actuary firm and permission for the Director-General to act inthe event of a crisis. The current balance of the Fund’s accounts does not call for emergencymeasures, which facilitates a more equanimous discussion about the reform project.

Recommendation No. 1. Following the judgments of the International Labour Organization Administrative Tribunal repealing the 2014 circulars, which modified the governance of the Medical Benefits Fund, the External Auditor recommends that UNESCO take a position, as a matter of urgency, on the governance arrangements for the Fund that should be adopted and proposed to the General Conference.

7 Common practice is for an actuary to carry out in-depth evaluations every five years as well as a more summary evaluation annually. The MBF already calls on the services of an actuary each year in order to assess UNESCO’s After-Service Health Insurance (ASHI) liabilities. This assessment is not supplemented with a study of the MBF’s long-term financial prospects.

8 Article 6.9 of the 2014 version of the Rules provides for an “External Subject Matter Expert [who] shall be hired to offer services related to MBF actuarial, financial and underwriting analysis”.

9 This procedure could be triggered, for example, if the Fund’s actuaries forecast a deterioration in the MBF’s financial performance at the latest three years after the publication of their report on the Fund’s development prospects.

10 The amendments to the 2008 Rules proposed in the present report concern sections V (Management of the Fund), and VI (Financial Provisions) and must therefore be submitted to the Board of Management and the General Assembly of Participants.

202 EX/32.INF.3 – page 6

Table 1: the MBF’s rules of governance

The 2008 version of the MBF Rules foresees the following principal modes of governance:

− the Fund is administered by a Board of Management composed of three representatives of the Director-General (Directors of the Bureaus of Human Resources Management, Financial Management, and Field Coordination, or their representatives) and three representatives elected by the participants for a period of three years, whose elected alternate members may participate in the meetings of the Board of Management, without the right to vote (Article 5.2 of the MBF Rules);

− the General Assembly of Participants shall meet once a year in Ordinary General Assembly to examine and approve the report of the Board of Management on the activities and finances of the Fund; it formulates recommendations on the general policy of the Fund and improvements that it would like to see made to its operation. An Extraordinary General Assembly 11 may be convened either by the Board of Management or at the request of at least 200 participants. (Article 5.1 of the MBF Rules);

− amendments to the Fund’s Rules adhere to the following procedure: proposed amendments to any of the provisions contained in sections V (Management of the Fund), VI (Financial Provisions), VII (General Provisions, particularly in regards to amendments to the Rules) of the Rules and the annexes thereto (particularly Annex III, which determines the rates of reimbursement for healthcare), must be submitted by the Board of Management to the General Assembly of Participants with a commentary, after which they are submitted to the Director-General “who shall take such action as he/she considers necessary”. 12 The provisions contained in other sections of the Rules may be amended by the Director-General on the recommendation of the Board of Management (Article 7.1).

The version of the Rules amended in 2014 and annulled by the ILOAT foresaw the following provisions:

− the Director-General takes final decisions on all matters relating to the Fund (Article 5.1);

− the Advisory Board – composed of three members nominated in their personal capacity by the Director-General for a period of three years and three members and three alternates elected for a period of three years by the participants, through electronic and mail voting – is consulted on all matters related to the management of the Fund, particularly modifications to the Fund’s Rules. It gives its opinion on the annual financial statements and on the “recommendations of the External Expert”13 (Article 5.2);

11 The Rules do not confer specific competences on the Extraordinary General Assembly of Participants. 12 This formulation permits the Director-General to not implement an amendment to the Rules that has been

submitted to him/her. The ILOAT’s two judgements dated 8 February 2017 stipulates, however, that the formulation does not permit the Director-General to make an amendment to sections V, VI, VII and the annexes to the Rules, which has not been approved by the General Assembly of Participants.

13 Article 6.9 of the 2014 version of the Rules states that an “External Subject Matter Expert shall be hired to offer services related to MBF actuarial, financial and underwriting analysis”.

202 EX/32.INF.3 – page 7

− The Director of the Bureau of Human Resources Management and the Chief Financial Officer jointly assess all recommendations from the MBF Coordinator and make recommendations to the Director-General; the Chief Financial Officer is responsible for keeping the accounts and ensuring the financial oversight (Article 5.3);

− The Coordinator of the Medical Benefits Fund is a UNESCO staff member, appointed by the Director-General, who administers the day-to-day operations of the Fund (Article 5.4);

− the General Meeting of Participants convenes at least once a year to examine the report on the activities of the Advisory Board, and makes recommendations to the Advisory Board;

− amendments to the Rules are made by the Director-General on a proposal from the Director of the Bureau of Human Resources Management in consultation with the Chief Financial Officer, the Coordinator as well as the Advisory Board; each proposal must be examined by the Advisory Board and both the aforementioned directors, who formulate recommendations to the Director-General; the Director-General shall then “take such action as he/she considers necessary”. (Article 7.1)

Source: External Auditor, based on the MBF Rules.

2. Administrative organization of the Medical Benefits Fund

2.1 The Fund is administered with the help of an external and self-insured administrator

20. Until 2008, the Fund was self-managed and self-insured, meaning the Pensions andInsurance Office of the Bureau of Human Resources Management (HRM/SPI), working underthe direction of the Board of Management, were entrusted with the entire management of thehealthcare insurance plan and assumed the financial risks associated with the administrationof medical care for active and retired staff on its own, without recourse to an insurancecompany. Such risks would materialize in the event of the UNESCO staff’s insurancecontributions being insufficient to cover the cost of the medical care.

21. Since 2009, the day-to-day management of the Fund has been entrusted to two entities:the Pensions and Insurance Office of the Bureau of Human Resources Management(HRM/SPI) and a company acting as external administrator, contracted through a call fortenders for a period of three years.

22. The Pensions and Insurance Office is part of the Services Section of the Bureau ofHuman Resources Management (HRM/SES). It is a small team, reduced to five staff membersin the 2016-2017 biennial budget, one of whom is not assigned to health insurance, but liaiseswith the United Nations Joint Staff Pension Fund14 on which UNESCO’s staff is dependent.15

It is financed by the regular budget with the exception of a G-6 staff member whose salary ispaid by the Funds-in-Trust Overhead Costs Account.16 It assumes the following tasks:

14 UNJSPF 15 In the 2016-2017 budget, the section is comprised of one P-4 grade head of section, an administrator in

charge of pensions (P-3) and three members of staff in charge of health insurance (one P-1 or P-2, one G-R and one G-6). Their salaries are paid from the regular budget, apart from the G-6 staff member who is paid by the FITOCA. The 2012/2013 budget provided for the service to comprise nine members of staff; like the present-day service, one of them was in charge of pensions and one was a G6 member of staff remunerated by FITOCA.

16 FITOCA.

202 EX/32.INF.3 – page 8

− the head of the section is the Coordinator of the Fund, a role created in 2014;

− the section assists the Fund’s governing bodies (the Advisory Body and the General Assembly of Participants); it organizes meetings, establishes the projects on the agenda and drafts the minutes;

− it draws up the specifications for tenders to contract the external administrator and participates in the Contracts Committee which examines the bids;

− it oversees the external administrator’s services, notably on a monthly basis by examining the list of reimbursement claims and entering into discussion over the most costly claims for reimbursement;

− in collaboration with the Bureau of Financial Management (BFM), it proposes and draws up draft amendments to the Fund’s Rules, and reports on the state of the Fund;

− it commissions and makes use of potential reports by external consultants on the MBF’s performance and long-term prospects, while BFM commissions the annual reports from the actuary relating to After Service Health Insurance.17

23. The external administrator manages the reimbursement of healthcare expenses; itreceives claims from staff members for the reimbursement of healthcare expenses submittedalong with the invoices from medical practitioners and institutions, checks the authenticity inconsultation with its medical director and reimburses the staff members concerned inaccordance with the rates listed in Annex III to the Rules of the Fund. It recommends ahealthcare network for the beneficiaries.

24. The successive external administrators have been:

− GMC Henner, from 2009 to 2011;

− Vanbreda International from 2011 to 2013;

− Vanbreda International once again, which changed its name to Cigna in February 201518, from 2013 to 2016;

− and MSH International, since 1 January 2017 and until 31 December 2019, further to the call for tenders issued on 6 June 2016 and concluded by the decision taken on 22 September 2016 by the UNESCO’s Contracts Committee.

25. The tender procedure, each stage of which was examined by the audit team, complieswith Article 10.5 of the Financial Regulations, the Administrative Manual (notably Item 7.7 onlong-term agreements) and UNESCO’s Procurement handbook.

26. The three-year duration of the external administrators’ contract complies with Item 7.7 ofthe Administrative Manual, which allows the establishment and use of long-term agreements(LTAs) for a period of one to four years. This results in a frequent reopening of competition forthe contract, which is presumed to be in the financial interest of the Organization. Its brevity,however, presents disadvantages for the staff in the event of a change of contractor, as hasrecently occurred.

17 ASHI 18 Vanbreda International was bought by Cigna in 2010. The conventions in relation to this operation prohibit

the use of the name Vanbreda International as from February 2015.

202 EX/32.INF.3 – page 9

27. The transfer of files from Cigna to MSH International resulted in delays in the reimbursement of healthcare expenses for which the International Staff Association of UNESCO (ISAU) made an official complaint on 7 March 2017, published on the Organization’s Intranet site. Such delays had already occurred in the past on the occasion of the appointment of a new external administrator.

28. These delays are owed, in particular, to shortcomings in the transmission of the participants’ files from one external administrator to another (see hereafter). An extension of the duration of external administrators’ contracts would help to mitigate these difficulties in the future. Establishing contracts for a period of four years would be in accordance with the maximum duration of LTAs provided for in Item 7.7 of the Administrative Manual. Establishing contracts for a duration of five or six years would imply a derogation from the aforementioned provisions, which is legally possible.

Recommendation No. 2: The External Auditor recommends examining the possibility of extending the duration of the Fund’s external administrators’ contracts to limit delays in payment at the beginning of the term of office of each new external administrator.

29. As opposed to many of the United Nations agencies (see Table 2 hereafter), the Fund has not called on a private insurer to underwrite the Fund’s financial risks. It has, in the past,19 examined the pros and cons of such recourse and successfully called on insurance companies and brokers to obtain offers. Nevertheless, it decided to continue insuring itself owing to the cost of insurance premiums and the risk of being compelled to raise contribution rates, at the request of the insurer, on a more frequent basis than it would do of its own accord.

30. However, the total outsourcing of the Fund would prevent non-regulatory derogations from the reimbursement rules, which are sometimes observed at present (see hereafter). In the experience of other international organizations, private bodies strictly bound by contract are better equipped to resist pressures from beneficiaries than are managers of international organizations when it comes to applying the rules and healthcare reimbursement rates.

Table 2: Comparison of health insurance plans adopted by other international organizations

International Organizations Health insurance plans

New York

United Nations Headquarters United Nations Development Programme (UNDP) United Nations Children’s Fund (UNICEF) United Nations Fund for Population Activities (UNFPA)

Seven health insurance plans managed and insured by private insurance companies are offered to the staff members of the international organizations listed opposite; some plans cover total medical care, others cover specific medical care; one specialises in dental health, one in emergency medical assistance; one covers medical care for travel away from the headquarters of the organization in question.

19 See the Director-General’s report, document 159 EX/24 dated 31 March 2000, on the option of

outsourcing healthcare insurance.

202 EX/32.INF.3 – page 10

Geneva United Nations Office at Geneva (UNOG) Self-insured and self-managed plan

World Health Organisation (WHO) Self-insured health plan

International Labour Office (ILO) International Telecommunication Union (ITU)

Self-insured and self-managed health plan

World Intellectual Property Organization (WIPO)

Health plan managed and insured by a private insurance company

Universal Postal Union (UPU) Health plan managed and insured by a private insurance company

Vienna United Nations Office in Vienna (UNOV) United Nations Industrial Development Organization (UNIDO)

Health plan managed and insured by a private insurance company

International Atomic Energy Agency (AIEA)

Health plan managed and insured by a private insurance company

Rome United Nations Food and Agriculture Organisation (FAO)

Health plan managed and insured by a private insurance company

World Food Programme (WFP) Five different health plans according to staff category, managed by external administrators and insured by private insurance companies. For one of the plans, which covers non-permanent staff, WFP insures itself and reimburses medical care up to $500

Montreal International Civil Aviation Organization (ICAO)

Health plan managed and insured by a private insurance company

London International Maritime Organization (IMO) Health plan managed and insured by a

private insurance company

Paris Organisation for Economic Co-operation and Development (OECD)

Health plan managed by an external administrator and insured by a private insurance company

Sources: External Auditor, debased on a 2007 report by the Joint Inspection Unit (JIU) of the United Nations system (United Nations System Staff Medical Coverage) and information communicated by the OECD and WFP.

202 EX/32.INF.3 – page 11

2.2 At present the Fund only manages a basic health insurance plan

31. The Fund currently manages a basic health insurance plan that UNESCO staff membersare free to supplement with a complementary health insurance plan of their choice. A healthinsurance broker, who works in the Medical Service two afternoons a week, provides themwith a list of mutualist health insurance companies whose different complementary healthplans best supplement UNESCO’s health insurance plan. The UNESCO Staff Union (STU)and the International Staff Association of UNESCO (ISAU) each offer complementary healthinsurance plans. 20

32. A clause in the call for tenders mentioned above for the renewal of the externaladministrator provided for an optional complementary health insurance plan to be offered atUNESCO. The existence of a complementary plan linked to the compulsory basic plan wouldspeed up the reimbursement of healthcare expenses, since staff members would no longerhave to apply first to the basic health insurance plan and then to their optional complementaryhealth insurance plan.

33. It would also make it possible for hospitals treating UNESCO MBF participants to havegreater certainty of full reimbursement of their expenses. When an active staff member whodoes not have a complementary insurance plan is unable to reimburse the portion of theirhealthcare expenses that is not covered by the MBF, the latter pays the full cost of treatmentor hospitalization and then recuperates the amount by deducting it from the salary of the staffmember concerned. This procedure cannot be used in the case of retired staff members whosepensions are paid by the United Nations Joint Staff Pension Fund (UNJSPF). This situation isone of the causes of the difficulties encountered by the MBF’s external administrators with thepublic hospital system of the city of Paris and its suburbs (AP-HP) (mentioned hereafter).

34. The candidates complied with this clause in the call for tenders and MSH International,the winner, proposed the introduction of such a complementary plan in its tender bid, whichwas filed in July 2016 and accepted, as regards the appointment of the external administrator,on 22 September 2016.

35. Nevertheless, since that date, discussions have been ongoing between HRM/SPI, MSHInternational and the insurance company ALLIANZ. The length of the discussions can beattributed to three factors:

− the workload of the Pensions and Insurance Office (HRM/SPI);

− the need for MSH International to have the complementary plan insured by a private company (hence the participation of ALLIANZ in the negotiations) and to supplement this plan with optional superannuation insurance possibilities, permitting the reimbursement of costly hospital care above the ceiling fixed by the MBF;

− the optional nature of the complementary plan, which makes it difficult for the MBF’s private partners to assess the number of its adherents and its financial viability.

36. MSH International has recently proposed two optional possibilities to the MBF. It wouldbe advisable to speed up negotiations.

20 The complementary plan on offer from STU was negotiated with an insurance broker, the Ciprès Vie Group, whereas ISAU proposes one negotiated with the mutualist health insurer, Humanis.

202 EX/32.INF.3 – page 12

Recommendation No. 3: The External Auditor recommends accelerating negotiations for the complementary health insurance plan proposed in the call for tenders concluded in September 2016

3. Administrative organization of the medical service

37. There is a certain discrepancy between the texts defining the functions of the medical service and the actual tasks performed by the service.

3.1 The functions of the medical service according to the regulations

38. The existence of a medical service (HRM/MDS) headed by the Organization’s Chief Medical Officer is stated in the Fund’s Rules and the Human Resources Manual.

39. Article 5.5 of the Fund’s Rules (2014 version) indicates that the Organization’s Chief Medical Officer shall “lend his/her expertise in the examination of appeals in accordance with the procedures described in Article 4.10”21 and if need be, “the Chief Medical Officer provides advice to the MBF Coordinator and to the Advisory Board on the assessment of claims appeals as requested”.

40. The Human Resources Manual22 grants the Medical Service the right to exercise the following principal responsibilities:

− to carry out staff medical examinations on recruitment;

− to help staff members in allocating an appropriate doctor or health facility;

− to administer first aid in cases of emergency to any injured or sick person in the Organization’s buildings;

− to examine medical certificates forwarded by staff members absent because of illness;

− to conduct periodic inspections in the Headquarters buildings to ensure that proper sanitary standards are met;

− “to perform treatments of a continuing nature to staff members, such as dressings or injections, upon presentation of the medical prescription ordering such treatment and under condition that the staff member provides the necessary pharmaceutical supplies”.

41. In practice, the Medical Service performs medical examinations on all UNESCO staff upon recruitment, on staff to be transferred to another post and on any member of the Organization’s staff upon request, as well as systematic annual medical check-ups for security staff, manual workers and chauffeurs; it adjudicates all claims for sick leave submitted by staff members. 23

3.2 Functions performed by the Medical Service without a regulatory basis

21 Article 4.10 states that the Organization is subrogated to all rights of recovery [that may be available to a

participant or protected person against any third party. It could then be called on in a lawsuit opposing a beneficiary to a third party, for example, requiring medical expertise.

22 Annex 1 to the present report quotes the exhaustive list of Medical Service’s competences enumerated in paragraph 10 of the Human Resources Manual Item 7.2.

23 For this purpose, the doctors have access to an IT application, which provides them with the number of sick leaves accorded to an individual throughout the year, which makes it easy to detect requests for sick leave which seem abnormally long.

202 EX/32.INF.3 – page 13

42. Three functions are performed by the Medical Service without a regulatory basis: medicaladvisor scrutinizing the appropriateness of the medical treatment reimbursed by the Fund,prevention, and medical examinations of members of delegations to UNESCO and membersof other international organizations.

(a) The role of the medical advisor in scrutinizing the appropriateness of costly medicaltreatments

43. The Organization’s Chief Medical Officer said: “it is rare that the Medical Service is askedto give its opinion” because, “over the last ten years, the medical advisory role assigned toUNESCO’s Chief Medical Officer has progressively been transferred to the doctor of the MBF’sservice provider company”.24 He expressed the wish for his role to be “clarified”.

44. In addition to the functions entrusted by Regulation 5.5 of the Fund Rules, the ChiefMedical Officer of the Organization advises the Fund on costly treatments, the amount of whichreaches the ceilings for the reimbursement of healthcare expenses provided for in Annex III tothe MBF Rules. This role, which is not provided by the Rules of the Fund, is shared with thatof the medical director of MSH International. In practice, the two doctors discuss the mostcostly treatments together. They have a good working relationship and the medical director ofMSH International considers that in the event of litigation, UNESCO’s Chief Medical Officerhas the final say.

45. The established practice of double examination of claims for reimbursement of costlyhealthcare by the MBF Medical Service and by MSH International constitutes a guarantee ofthe quality of the service. Nevertheless, this practice is costly, as UNESCO has to pay boththe Medical Service and MSH International (including the cost of its medical director andnurses in the price charged to UNESCO for its tasks, which is €22.50 per month perparticipant).

46. The Organization should therefore reflect on the merits of this situation and drawconclusions for the future. Three alternative solutions are logically conceivable :

− explicitly entrust UNESCO with the task of dealing with all cases of costly and complex healthcare and withdraw this task from the external administrator when the contract comes up for renewal in three years’ time, which should result in a reduction in the cost of the latter’s contract ;

− endorse and formalize the current situation, by giving competence to the UNESCO Medical Service to monitor all proposals by MSH International for the reimbursement of costly or complex healthcare;

− respect the current rules and the contract established with MSH International which entails leaving MSH International to deal with costly and complex cases and only involving the UNESCO Medical Service in the event of complaints from users or the MBF, the most logical solution as it would enable the Medical Service to reduce the working time of one of its doctors and increase its prevention activities, for example.

Recommendation No. 4: The External Auditor recommends that consideration be given to the proper division of labour between the UNESCO Medical Service and the

24 Excerpts from comments made by UNESCO’s Chief Medical Officer on 31 May 2017 relative to the External Audit team’s provisional observation programme.

202 EX/32.INF.3 – page 14

MBF’s external administrator, and legal conclusions be drawn by modifying, if necessary, the Rules of the MBF and the tasks of its external administrator.

(b) Provisions for prevention

47. Paragraph 10 of Human Resources Manual Item 7.2, which defines the functions of the Medical Service, provides only very partial provisions for prevention.25

48. In practice, in addition to vaccinations, the Medical Service carries out the following few preventative measures: it advises staff before their departure on missions (or any other travel) carries out screening campaigns, publishes messages on the Organization’s Intranet site (Unescommunity) and organizes systematic medical examinations for staff members who change post (less costly than frequent check-ups).

49. In order to make the rules coincide with practice, it is recommended hereafter (Recommendation No. 8) that a real prevention policy be defined and that the action provided for in the policy be included in the Rules.

(c) Medical examinations for members of delegations and other international organizations.

50. The Medical Service provides the free-of-charge “treatments of a continuing nature” mentioned above not only to staff members but also to members of delegations to UNESCO (but not their spouses and children); this is not provided for by UNESCO’s rules and does not correspond to the practice of the other international organizations known to the External Auditor.

51. In the past, UNESCO’s retired staff also benefitted from free medical care and follow-up. Such practices were abolished two years ago owing to the excessively high numbers of retired staff making use of the service.

52. It is also the case that officials from other international organizations benefit from free medical examinations not provided for in the regulations: medical examinations on recruitment for officials working in France and appointed to New York, for example, are performed by the UNESCO Medical Service. Similarly, medical examinations for officials recruited by UNESCO but resident in Geneva or New York, for example, are undertaken by the United Nations medical services in each city. Such examinations do not occur frequently and are in keeping with the quid pro quo practices between international organizations.

53. Lastly, two international organizations, the United Nations Development Programme (UNDP) and the Council of Europe Development Bank 26 have their statutory medical examinations (pre-recruitment check-ups, control in the event of sick leave, etc.) performed by UNESCO. These medical examinations are not provided for in the Human Resources Manual but have been the subject of agreements and are billed to the two organizations at different rates (€80 per examination in the case of CEB and €90 for UNDP): it is clearly necessary to update the rate applied to the CEB.

54. The sums paid by these two international organizations represent modest amounts, equivalent to $4,809.75 for CEB and $4,058.60 for UNDP in 2016. The sums are transferred

25 Paragraph 10 of Human Resources Manual Item 7.2, “(d) to administer or arrange for the administration of

vaccinations and inoculations related to official travel and in such other circumstances as may be required by the Organization”.

26 CEB.

202 EX/32.INF.3 – page 15

onto a technical account,27 which is used by the Medical Service to purchase material (a defibrillator and a fridge for vaccinations, for example). It is advisable to formalize these rules.

55. The number of people treated by the Medical Service’s doctors and nurses, whether for medical emergencies, follow-ups or advice, was 7,546 in 2015, 7,433 in 2016 and 2,437 for the first term of 2017 (2,152 in the Fontenoy building and 285 at the Miollis site).

56. The Medical Service maintains a computerized list of the people examined, indicating the categories of the beneficiaries, but the software does not allow for the extraction of statistics on the status of these people. It is estimated that 70% of the examinations concern incumbent civil servants, 20% concern contractors, consultants, interns and representatives of other international organizations and 10% members of delegations to UNESCO (80% in the case of the infirmary at the Miollis site, which is in close proximity to the delegations’ offices).

57. The situation should therefore be regularized either by no longer permitting members of delegations to receive medical advice and “follow-up medical care”,28 or by setting a rate for such services and applying it.

58. In order to carry out its functions of providing medical advice and “treatments of a continuing nature”, the Medical Service calls upon its two full-time doctors (including the Chief Medical Officer) as well as several medical specialists who provide cover during annual leave: a psychiatrist (24 half-days per year), a gynaecologist (36 half-days per year) and an occupational doctor (six half-days per year). These temporarily employed doctors are paid by the Medical Service but their services are free of charge for UNESCO staff and members of delegations. The use of an occupational doctor is consistent with the competencies given to the service by the Human Resources Manual, to carry out medical examinations as required by the Organization, as set out in HR Item 13.12.29

59. On the other hand, the use of temporary specialist doctors is not very clear: it does not correspond to the functions assigned to the Service by the HR Manual, whether in terms of guidance, emergency care or “treatments of a continuing nature” and UNESCO staff may be reimbursed for psychiatric and gynaecological care by a doctor of their choice. The Medical Service considers that these psychiatric and gynaecological consultations constitute forms of preventive medicine, but the Manual gives it very little power in this regard since it only evokes “preventive measures that may be necessary as a result of an epidemic” 30. The Secretariat should also regularize this situation, either by terminating free-of-charge consultations by medical specialists for its staff and members of delegations, or by billing these services.

60. In 2012, the Medical Service had proposed that that these specialist consultations should be billed at a modest price (€20, which is lower than that of general practitioners reimbursed by the MBF, which was an average of €30 at the time) and reimbursed to patients by the MBF, in the case of UNESCO staff. This solution, which was not adopted at the time because of its complexity, deserves to be considered again.

Recommendation No. 5: The External Auditor recommends dispensing with or charging for the services provided by the Medical Service that are currently provided without a legal basis and free of charge (medical checks of all types and consultations of specialist doctors offered to members of delegations outside emergency cases and

27 The fund 185GEF0008, pertaining to the G/L account n° 7032020. 28 The advice and medical care are provided for respectively in subparagraphs (c) and (g) of Paragraph 10,

Item 7.2 of the Human Resources Manuel quoted in Annex 1. 29 Subparagraph (a) of Paragraph 10 Item 7.2 of the Human Resources Manuel, quoted in Annex 1 hereto. 30 Subparagraph (j) of Paragraph 10, Item 7.2 of the Human Resources Manuel.

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specialist consultations offered to staff members, as the latter may be reimbursed for such consultations by the Medical Benefits Fund).

61. Despite these additional functions carried out by the Medical Service for the beneficiariesand by way of services non-compliant with UNESCO’s regulations, its staff remains limited. Infact, the Service’s permanent staff31 only includes two doctors (two full-time equivalents orFTE), four nurses (3.5 FTE), one social worker (one FTE) and one secretary (0.6 FTE) whichamounts to 7.1 FTE for 2,080 people32 which is less than the OECD (7.7 FTE) whose staffmembers, nevertheless, outnumber UNESCO’s, (3,396 compared to 2,080).

62. Each of these organization’s Medical Services does not fulfil exactly the same functions.The OECD’s Medical Service does not receive members of delegations (with the exception ofan emergency necessitating medical care within the Organization’s buildings) but it does carryout preventive measures (systematic check-ups for staff) which are rarely undertaken atUNESCO, on top of its occupational health duties and the emergency medical care commonto both organizations.

IV. FINANCIAL SITUATION OF THE MEDICAL BENEFITS FUND AND THE MEDICALCENTRE

1. Recent financial developments of the Medical Benefits Fund and the MedicalService

63. The income and expenditure of the Fund are recorded in UNESCO’s financialstatements. They are part of the Staff Fiduciary Funds,33 which comprise four categories offunds that cover UNESCO activities, including the Commissary, the Restaurant and theUNESCO Children’s Club and Day Nursery.

64. In particular, the Fund’s liabilities in terms of After-Service Health Insurance (ASHI) andthe assets accumulated to cover these liabilities are presented and commented on in theconsolidated financial statements (see hereafter).

65. In addition, a statement of the Fund’s financial performance is drawn up annually by theBureau of Financial Management (BFM). The main data in this document, which is internal tothe Secretariat, is included in the biennial report on the state of the Fund.34

66. Tables 3 and 4 hereafter, based on the statements of the financial performance of theFund from 2012 to 2016, show that the recent financial developments of the Fund are positive,since the proceeds of the contributions systematically exceed the reimbursements of medicalcare and the MBF’s reserves now amount to 17 or 18 months of its expenses, which is equalor higher than the standard considered desirable by the Bureau of Financial Management(BFM), of 15 or 18 months of its expenses.

67. This development, which contrasts with the four years of deficit observed from 2008 to2011, is owed to the increase in the rate of contributions that finance the Fund decided upon

31 Temporary replacement doctors are not included as they are not members of the Organization’s permanent staff.

32 The document published on Internet, Key Data on UNESCO Staff and Posts. January 2017, states that UNESCO staff members number 2,080, of which 692 work in field offices. At the end of 2016, for their 3,396 employees, the OECD had two available full-time doctors (1.7 full-time equivalent), five nurses (4 FTE), one medical secretary (0.8 FTE), one occupational psychologist (0.6 FTE) and one social worker (0.6 FTE), totalling 7.7 FTE. Like the UNESCO medical staff, they work in two separate centres.

33 SFF. 34 Documents 37 C/38 of 5 November 2013 and 38 C/43 of 12 August 2015.

202 EX/32.INF.3 – page 17

by the General Conference at its 36th session, in October 2011, and applied as of 1 January 2012.

68. The amount of the Fund’s annual surpluses is irregular for several reasons:

• the total cost of healthcare expenses reimbursed changes unpredictably from one year to the next (the cost decreased in 2015 and increased in 2016, for example, while the number of participants moved in the opposite direction);

• the provision for the estimated amount of claims not yet presented at the end of the year varies greatly from one year to the next: it represented 20% of total reimbursements in 2013, 30% in 2014, 28% in 2015 and 25% in 2016;35

• the annual result has been affected by foreign exchange gains and, since 2014, losses, as most of the transactions are carried out in euro in France, but recorded in dollars, the rate of which has increased since 2014 against the euro.

69. This irregularity of annual results means that it is difficult to make long-term forecasts of the Fund’s financial position. It is therefore essential to have actuaries evaluate this long-term evolution and in particular the evolution of expenditure corresponding to the medical coverage of retirees, which increases according to the increase in the share of retirees in the total number of beneficiaries and the aging of the retirees. As noted hereafter, the MBF has had such actuarial studies conducted in the past, but has ceased to do so since 2010, for financial reasons.

Table 3: evolution of the statement of the MBF’s financial performance, from 2012 to 2016 (in United States dollars)

2012 2013 2014 2015 2016

Total income (contributions) $26,204,869 $27,226,509 $23,447,896 $21,206,058 $21,952,693

Of which foreign exchange gains or losses

$247,993 $854,010 ($2,640,046) ($2,184,247) ($813,783)

Total expenditure $22,575,628 $23,516,342 $22,465,753 $17,845,040 $20,740,598

Net surplus $3,629,241 $3,710,167 $982,143 $3,361,018 $1,212,095

Cumulative surplus $19,039,292 22,749,459 23,731,602 27,092,620 28,304,715

Reserves (in months of expenditure) 11 12 13 18 17

Average number of active staff members

2,250 2,122 2,008 2,022 2,009

Average number of retired staff members

2,488 2,478 2,478 2,485 2,467

35 In its 2016 financial performance statement, for example, the Fund presented the €15,345,000 of healthcare

expenses reimbursed in 2016 and a provision of €3,985,000 for healthcare expenses that have not been claimed yet in 2016 (and that will therefore be paid in 2017 but must be recorded in accordance with IPSAS). This provision is equal to the percentage of care expenses paid in a deferred manner over the previous three years (28% in this case) applied to the total amount of healthcare expenses reimbursed for 2015.

202 EX/32.INF.3 – page 18

Average number of dependents

2,967 2,837 2,709 2,692 2,643

Source: External Auditor, based on data provided by the Secretariat.

Table 4: evolution of the technical balance (contributions – benefits) of the MBF from 2012 to 2016 (in United States dollars)

2012 2013 2014 2015 2016

Contributions 25,814,597 26,089,130 25,680,034 23,024,469 22,513,971

Benefits 22,575,628 23,516,342 22,465,753 17,845,040 20,740,598

Technical balance 3,238,969 2,572,788 3,214,281 5,179,429 1,773,373

Source: External Auditor, based on data provided by the Secretariat.

2. Recent financial developments of the Medical Service

70. The Medical Service is part of the Bureau of Human Resources Management (HRM),financed by the General Fund (GEF), which records the main activities of UNESCO.

71. The budget and the actual expenditure of the Medical Service are decreasing, in view ofthe financial difficulties faced by the Organization (see Table 5 below).

Table 5: evolution of the budget and actual expenditure of the Medical Service (in euro) 36

Appropriations 2013 budget

Actual expenditure

in 2013

Appropriations 2014 budget

Actual expenditure

in 2014

Appropriations 2015 budget

Actual expenditure in

2015

Appropriations 2016 budget

Actual expenditure in

2016

Appropriations 2017 budget

€46,065.26 €25,798.00 €23,707.80 €27,412.00 €34,632.50 €31,686.00 €24,113.74 €25,965.00 €21,996.47

Source: External Auditor, based on data provided by the Secretariat.

3. Long-term financial sustainability of the Medical Benefits Fund

72. In accordance with good practice, the Secretariat has undertaken actuarial studies of thelong-term evolution of the financial position of the Medical Benefits Fund and of the latter’sliabilities vis-à-vis current and future retirees of UNESCO. It has also begun to pool assets tocover these liabilities.

73. It must continue to conduct such actuarial studies in order to anticipate the risks ofdeterioration of its accounts and to study the measures that could address these risks. In thisregard, several reforms to improve its performance have already been identified in reports byconsultants and internal working groups. Other reforms are likely to improve the Fund’sperformance.

36 This table includes procurement for the Medical Service, which is charged to the budget of the Bureau of Human Resources Management (HRM) and not to that of the Medical Service. It does not include the salaries of permanent staff but does include fees paid to consultants and expenses for missions abroad.

202 EX/32.INF.3 – page 19

3.1 Observations by consultants

74. The Secretariat commissioned reports from the consultant firms Buck Consultants in2001 and Mercer and Deloitte in 2010. These reports focused on the financial sustainability,performance and governance of the Fund.

(a) Report by Buck Consultants in 2001

75. Buck Consultant’s report of 14 December 200137 found that the change in the ratio ofactive staff members to retirees (1.16 active staff members per retiree in 2001) wasdeteriorating rapidly and forecast a ratio of 0.95 active staff members per retiree 10 yearshence. It indicated that the MBF’s projected annual deficits from 2001 onwards would diminishthe Fund’s reserves to zero by 2009.

76. The report found that single persons participating in the Fund were subsidizing familiesand advised doubling the contributions38 for families with two insured persons (an active orretired UNESCO staff member and their dependent spouse, for example) and to increase thecontribution by 50% per additional person affiliated.39

77. It also recommended that different contribution rates be applied to active staff membersand retirees (whose average cost to the Fund is three times higher than that of active staffmembers).

78. The report also highlighted the poor quality control carried out by the Fund (which wasself-managed at the time): it identified duplicate payments for healthcare reimbursements, non-compliance with reimbursement ceilings and errors in the reimbursement statements.

79. It attributed these shortcomings to the shortage of MBF staff and advised the outsourcingof the healthcare insurance plan, a solution that was all the more appropriate since the MBFwas the smallest self-managed plan studied by the consultant.

80. Comparing UNESCO’s reimbursement scale with those of four other internationalorganizations (the International Labour Organization (ILO), International TelecommunicationUnion (ITU), United Nations Office at Geneva (UNOG), which are all self-managed and self-insured, and the World Intellectual Property Organization (WIPO)), it noted that UNESCO was“close to average”:

• the rate of reimbursement for medication and healthcare expenses (75%) waslower than that of the other organizations (80/90%);

• the rate of reimbursement for surgery (90%) was comparable with that of the otherorganizations (80 or 90%, 100% for WIPO in the case of public hospitals alone);

• reimbursement ceilings for dental expenses ($500 per year) were much lower thanthose of the other organizations;

37 This report was commissioned by the UNESCO Internal Oversight Service. 38 The rate of contributions in force in 2001 was set by circular No. 1985 of 7 December 1995, which increased

the rate by 30%: 2.640% of the wage or pension for a single participant with no dependents, 3.455% for one participant and one dependent, 4.265% for one participant and two dependents, 4.875% for one participant and three dependents and 5.485% for one participant and four or more dependents. This circular superseded the previous practice of a 0.25% increase in premiums if the participant or one of their dependents was 60 years old or more.

39 For an MBF participant and two dependents, the contribution would therefore be equal to two-and-a-half times that of a single participant; for one participant and three dependents, it would be equal to three times that of a single participant.

202 EX/32.INF.3 – page 20

• and periodic medical examinations were not covered (with the exception ofprenatal examinations), in contrast to the situation at ILO, ITU and the World HealthOrganization (WHO).

81. It noted, however, that geriatric nursing was reimbursed at the rate of 70% without anytime restriction, whereas this was not covered by the other abovementioned internationalorganizations. It therefore recommended that the rate of reimbursement be reduced andnursing care be restricted to cases of illness and accident.

82. The MBF outsourced the management of the reimbursement of healthcare expensesfrom 2009 onwards, but has not followed the recommendations concerning the adjustment ofcontribution rates for workers and retirees (considered to be incompatible with the principlesof risk-pooling that it applies) or the reduction of geriatric nursing care reimbursements.

(b) Report by Mercer in 2010

83. The Secretariat requested from the consulting actuary Mercer, which reports annually onthe MBF’s after-service health insurance (ASHI) liabilities, a special report on the financialposition of the healthcare insurance plan and its sustainability over 10 years.

84. The report, submitted on 12 February 2010, concluded that the Fund was not sustainableunless a reform was implemented, and there was a risk that the MBF would have a cumulativedeficit of $128 million in 2019 (at current value).

85. The ratio of the number of retirees to the number of working staff members was expectedto rise from 97%40 in 2010 to 110% in 2015 and to remain at the level of 110% until 2019.

86. The Fund’s expenditure was therefore expected to increase from $24 million in 2009 to$25 million in 2010 and $45 million in 2019, owing to French medical inflation (5% per year,which is 3% more than general inflation) and the increase in the number of retired staffmembers, while the annual contributions would remain stable at $20 million. Annual deficitswere expected to increase to 118% of the total annual contributions (half of which are paid bystaff and half by the Organization) in ten years, compared to 11% in 2008.

(c) Reports by Deloitte in 2010 and 2012

87. The Secretariat commissioned the firm Deloitte to undertake a more comprehensivestudy than the previous one on the long-term sustainability of the Fund, its contribution systemand its governance. On 9 July 2010, Deloitte submitted a report on all these issues, includingcomparisons with United Nations Headquarters, the United Nations Office at Geneva (UNOG),the United Nations Commission on Human Rights (UNCHR), International Fund for AgriculturalDevelopment (IFAD), the Food and Agriculture Organization of the United Nations (FAO) theWorld Food Programme (WFP) and the Organisation for Economic Cooperation andDevelopment (OECD).

88. This document was supplemented by a report issued on 10 July 2012 on the governanceof the MBF. The recommendations were discussed by a working group, the proposals of whichwere then submitted to the competent authority (the General Conference and, with regard togovernance, the General Assembly of Participants, as indicated above).

89. Deloitte’s 2010 report confirmed the long-term unsustainability of the Fund, thecontributions of which would only cover 83% of costs in 2010 and 81% in 2011. The firm

40 Note that this ratio of 0.97 is close to the forecast by Buck Consultants (0.95 active staff members per retiree ten years after 2001).

202 EX/32.INF.3 – page 21

therefore proposed that the rate of contributions be changed by adopting one of the following three options:

• uniformly increase contributions by staff and by UNESCO by 24%, which wouldraise $5.2 million (option 1);

• increase staff contributions by 14% (which would raise $1.5 million) andUNESCO’s contributions by 34% (which would raise $3.6 million), thus changingthe distribution of contributions by the two sides (staff would pay 46% and theOrganization 54%); in which case, recommended by Deloitte, the increase incontributions by each participant would be capped at not more than 5.5% of eachstaff member’s salary41 (option 2);

• increase contributions by the Organization by 48% (which would raise $5.1 million)and not alter the contribution by staff members, which would bring UNESCO’sshare to 60% of total contributions, in accordance with a demand from the StaffUnion and with the precedent of the United Nations Headquarters in New York42

(option 3).

90. The report also mentions the possibility of having the Fund managed by an externaladministrator and having it insured by a private insurer. It notes that the latter solution wouldallow for the payment of a fixed annual insurance premium instead of being exposed to largevariations in the annual amount of healthcare expenses, but would involve paying a margin of$396,000 to $792,000 per year (1.5 to 3% of the amount of the healthcare expenses). It refersto alternative possibilities of using a specialized firm to check a sample of reimbursementclaims to detect errors or calling on an external expert for advice on the Fund, the latter ofwhich is recommended.

91. Lastly, the following series of modifications to the scale of healthcare coverage isproposed in order to make savings:

• abolishing home nursing coverage (which encourages participants to insure theirparents as dependents rather than their children), a measure that would save 2.24%of costs, or $590,000 based on MBF expenditure for 2007/2008;

• reducing the time allowed for submission of reimbursement claims from two yearsto one year, which would reduce the amount of provisions for claims not yetsubmitted and would make the MBF’s annual expenditure estimates more accurate;

• setting an annual reimbursement ceiling for each affiliate member of $250,000 or$500,000, as do FAO, WFP, IFAD, UNOG and UNHCR, a measure that wouldreduce annual costs by 1.6% ($420,000) for a ceiling of $250,000 and 0.9%($241,000) for a ceiling of $500,000;

• reducing certain reimbursement rates: from 90% to 80% for assisted conception,medical devices and reimbursement of fees for hospital doctors; each of thesemeasures would result in savings of 0.05% or $14,000 per year;

41 In practice, the contributions of 53% of working staff members and 79% of retirees would have increased in this case.

42 At the United Nations Headquarters in New York, the Organization pays 66% of the contributions and staff members pay an average of 33% (working staff members pay 40% of contributions and retirees pay 20%).

202 EX/32.INF.3 – page 22

• introducing a prevention policy, which would increase costs in the short term by0.25% ($66,000) but would reduce the cost of cancer treatment through earlierdetection;

• abolishing the possibility of covering new family members as dependents (whilethe situation of those who are already covered as dependents of the participantswould not be modified).

92. The working group that met to consider these recommendations proposed to the GeneralAssembly of Participants that they adopt the following measures based on the Deloitte report:

• a slightly modified version of option 2 above in terms of contribution rates;UNESCO would pay 55% of contributions instead of 54%; contributions byparticipants with several dependents would be increased by a greater amount (asproposed by Buck Consulting) and the maximum rate of contributions byparticipants would be 6.5% of their salary or pension and not 5.5%;

• abolition of nursing care coverage and establishment of special insurance for thepersons concerned;

• reduction of the time allowed for submission of reimbursement claims;

• submission to the Board of Management for prior approval of healthcare expensesof more than €250,000 (without setting an annual ceiling for reimbursement);

• introduction of a prevention policy;

• prohibition of the registering of new dependent persons;

• hiring of an independent consulting firm.

93. The recommendations of these various reports were followed up on a very small numberof points: the General Conference, at its 36th session, in October 2011, revised the contributionscale with effect from 1 January 2012, by increasing the contribution rates of participants withdependents (see Table 6 below), without changing the equal distribution of contributions bythe staff and by the Organization; circular AC/HR/16 of 23 June 2011 reduced the time allowedfor submission of reimbursement claims from two years to one with effect from 1 July 2011,and deleted Article 2.3 (d) of the MBF Rules, which authorized the recognition as dependentsof the participants their parents, brothers and sisters when no spouse or child was admitted tocoverage by the Fund as a protected person.43

Table 6: comparison of contribution scales applied from 1996 and from 201244

Contribution scale applied from 1996

Contribution scale applied from 1 Feb 2012 Evolution 2012/1996

1 participant with no dependents 2.640% 3.16% +19.69%

1 participant with 1 dependent 3.455% 4.75% +37.48%

1 participant with 2 dependents 4.265% 5.54% +29.89%

43 In any event, the number of parents insured by MBF as dependents is very low: 35 out of a total of 7,140 participants as at 31 December 2016. However, 20 of these parents are aged 75 and over, a category for whom the reimbursements are 27% higher than the average and grow rapidly with age (see Annex 3).

44 The two scales were implemented by Administrative circulars No. 1985 of 7 December 1995 and AC/HR/20 of 23 December 2011.

202 EX/32.INF.3 – page 23

1 participant with 3 dependents 4.875% 6.33% +29.84%

1 participant with 4 or more dependents 5.485% 6.50% +18.50%

Key: the contribution rate (2.640%, for example) applies to the amount paid from the salary or pension of the participant.

Source: External Auditor, based on data provided by the Secretariat.

94. The Director-General proposed to the General Conference at its 37th session, inNovember 2013, a new formula for sharing the costs of contributions (60% paid by theOrganization and 40% by the staff, which are different rates from those proposed by Deloitteand the working group), with deferred application to the 2016-2017 budget. The GeneralConference refused this new formula, but accepted a reform of the Fund’s governance inspiredby the Deloitte reports.45

3.2 Establishment of a reserve to offset the Fund’s liabilities with regard to retirees

95. In accordance with IPSAS, the Organization discloses in its financial statementsinformation on its liabilities in terms of employee commitments. Since UNESCO does not haveits own pension system, as its staff depend upon the United Nations Joint Staff Pension Fund(UNJSPF), the greatest liabilities are made up of the rights of current and future retirees to thereimbursement of their healthcare expenses.

96. As these liabilities increase very rapidly (see Table 7), the External Auditorrecommended the funding of After-Service Health Insurance (ASHI) to offset these liabilities inorder to reduce their impact on the Organization’s financial position in the audit reports on thefinancial position of the Organization as at 31 December 2011, 2012, 2013, 2014 and 2015(these recommendations are contained in Annex 2 to this report).

Table 7: evolution of UNESCO’s ASHI liabilities (in millions of dollars)

Amount of liabilities Dates

522.0 31 December 2008

649.0 31 December 2009

735.6 31 December 2010

749.8 31 December 2011

777.2 31 December 2012

838.7 31 December 2013

1265.0 31 December 2014

780.0 31 December 2015

767.0 31 December 2016

45 As indicated above, the Director-General first proposed to the General Assembly of Participants in September 2013 a reform of the MBF governance structure inspired by the 2010 Deloitte report, supplemented by the 2012 report. As the reform was not accepted, a slightly modified version was submitted to the General Conference in November 2013 and was accepted.

202 EX/32.INF.3 – page 24

Source: External Auditor, based on data provided by the Secretariat.

97. The Secretariat, having found that 11 out of 18 other international organizations examined had set up funding mechanisms, considered four alternative mechanisms:46

• payment by Member States of a contribution corresponding to total liabilities ($777.2 million in 2012), the investment of this amount and the payment each year of a budget allocation being equal to the amount of the new liabilities calculated by the Organization’s actuary (option 1);

• payment of a specific annual contribution by Member States over 15 years, which would increase the budget by 8% at the beginning and by 12% after 15 years (option 2);

• inclusion in the payroll of a levy equal to the cost of services rendered in 2012 ($22.6 million), which would increase annual staff costs by 5.6% and reduce the budget programme available for funding the Organization’s programme (option 3);

• use of the Organization’s possible budgetary surpluses, which is unrealistic since the Organization’s budget is currently in deficit (option 4).

98. In order not to reduce the funding of the Organization’s programme too much, the Director-General proposed the implementation of a slimmed-down version of option 3, consisting of charging 1% of staff costs and allocating the estimated amount of $4 million for the 2014-2015 biennium to a Special Account for After-Service Health Insurance (ASHI), the purpose of which is to establish a reserve covering the future costs generated by retirees’ rights to health coverage.

99. This proposal was approved by the General Conference at its 38th session, in November 2015, and supplemented by a transfer of $2.1 million from the regular budget to the Special Account and a 4% levy on the salaries of staff members falling under the MBF and funded by extrabudgetary funds. The Special Account held $7,803,354 as at 31 December 2016, which represents 1.02% of ASHI liabilities as at 31 December 2016.

100. In his 2016 report on the financial position of the Organization as at 31 December 2015, the External Auditor recommended that the measures adopted for the 2016-2017 biennium be maintained during future biennia and that the Organization “formulate a funding strategy enabling the long-term sustainability of this debt”, by determining the target level that the Special Account for After-Service Health Insurance (ASHI) should achieve and by taking additional measures to achieve this target (see Recommendation No. 1 of the aforementioned report, quoted in Annex 2).

101. The Secretariat has not yet proposed a target, nor has it decided on additional measures to supplement the income of the Special Account. It would be good practice to set a percentage of ASHI liabilities to be hedged by assets and to have an actuary estimate the date when that target should be achieved. The External Auditor will continue to make recommendations on this issue in his annual reports on the financial position of the Organization.

46 See document 191 EX/29 of 25 March 2013: Funding proposal for After-Service Health Insurance (ASHI).

202 EX/32.INF.3 – page 25

3.3 Reforms likely to improve the long-term financial sustainability of the Medical Benefits Fund

(a) The systematic use of actuarial studies on the long-term financial development of theMBF

102. To ensure the long-term financial sustainability of a pension plan or a health insuranceplan, the first precaution to take is to have an actuarial firm regularly assess the futuredevelopment of income, expenses and the balance of the plan, and when it constitutesreserves, development of the plan’s assets.

103. These regular estimates make it possible to predict the year in which the Fund will be indeficit and the year in which it has exhausted its reserves and therefore will have to suspendpayments and consider measures necessary to restore the situation.

104. As noted above, the usual practice is for an actuary to conduct thorough actuarialassessments at regular intervals (every five years, for example) as well as a more summaryassessment annually.

105. It is regrettable that the Fund has not been able to continue to carry out suchassessments since 2010,47 even though an amendment to its Rules in 2014 provides that an“External Subject Matter Expert shall be hired to offer services related to MBF actuarial,financial and underwriting analysis”. Regardless as to whether this legal provision isreproduced in the version of the Rules that will be adopted after the annulment of some of itsprovisions following the ILOAT judgement, it is essential that these actuarial studies beconducted.

Recommendation No. 6: The External Auditor recommends regular actuarial assessments of the long-term financial development of the Medical Benefits Fund so as to be able to detect sufficiently in advance the risks of deficit and depletion of the Fund’s reserves in order to take the necessary measures in a timely manner to restore the situation.

(b) Amendments to some rules

106. If the recommended actuarial assessments show the need for measures to avoid theFund’s deficit in the future, two types of reforms could be adopted: increased contributions andchanges to healthcare coverage and the terms of MBF membership.

107. As mentioned above, the reports by Buck Consultants in 2001 and Deloitte in 2011proposed some reforms that could lead to savings for the Fund, which were not implemented,after examination by specialized working groups, for the following reasons: UNESCO’shealthcare coverage is generally less favourable for participants than that of other internationalorganizations; and the actual impact of some of the proposed measures appeared to be limited(for example, Deloitte’s proposal to reduce the percentage of reimbursement of hospital

47 These actuarial assessments of the long-term sustainability of the Fund’s financial position are different from the annual assessments made by an actuary of the amount of UNESCO’s ASHI liabilities, to comply with IPSAS 25. In practice, two different discount rates are used in the actuarial projections. For the preparation of annual financial statements, the rates used are those required by IPSAS 25, which refers to the rate of return of high-quality fixed-income investments, such as government bonds. Such a methodology allows a very conservative estimate of the actuarial value of the liabilities and assets of a plan at any given time, but it is not a realistic forecast of changes in the assets and liabilities of the plan. When an actuary seeks to predict the long-term evolution of the assets and liabilities of an insurance plan, to ensure the plan’s viability, the actuary generally uses the rate of return on the assets that the plan has set itself.

202 EX/32.INF.3 – page 26

doctors’ fees from 90% to 80% would only have saved about $14,000 per year for each of these measures).

108. These reasons remain valid and the scope for savings offered by marginal changes in the rules in force are limited. Reconsidering the healthcare coverage could also have a negative effect on UNESCO’s attractiveness on the international labour market: the terms of the Organization’s health insurance plan is one of the elements (such as salary, pension plan, interest of the work and location in Paris or many field offices) that encourage competent professionals to apply for post vacancies at the Organization.

109. The already less favourable nature of UNESCO’s healthcare coverage was already indicated in a report by the Joint Inspection Unit (JIU) of the United Nations system (United Nations System Staff Medical Coverage), mentioned above (see Table 8 hereafter).

110. Some amounts mentioned in this study may have changed since 2007, but the data in Table 8 below concerning UNESCO were still valid in 201748 and the less advantageous nature of UNESCO’s healthcare coverage compared with the average was confirmed by Deloitte’s report of July 2010 quoted above, comparing United Nations Headquarters, the United Nations Office at Geneva (UNOG), the United Nations Commission on Human Rights (UNCHR), the International Fund for Agricultural Development (IFAD), the Food and Agriculture Organization of the United Nations (FAO), the World Food Programme (WFP) and the Organisation for Economic Cooperation and Development (OECD).

111. UNESCO’s reimbursement rate for most of healthcare expenses is 75%, compared with 80% or more at the other organizations. The reimbursement rate for dental care is lower at UNESCO: it is limited to €750 per year and per insured person (and €500 per year and per insured person for orthodontic care). The same applies to optical care for spectacles and frames (quoted hereafter, the regulations being somewhat unclear).

112. On the other hand, the reimbursement rate for hospitalization is comparable to other organizations (90% at UNESCO, compared with 80% to 100% elsewhere) and the total annual reimbursement per insured person is not capped and is not subject to prior agreement, which is advantageous.

Table 8: comparison of reimbursement rates for healthcare at various international organizations

Organizations Annual reimbursement ceiling ($)

Medical fees and medicines

External Services (laboratories, X-rays, etc.)

Medical treatments Hospitalization Nursing

care Dental care

United Nations Headquarters, UNDP, UNICEF, UNFPA

Not disclosed From 80% to 100%. Amounts incurred outside the recommended network borne by the participant

ILO 150,000 80%

FAO 1,000,000 80% 80%

80% (and 100% for mammography)

100%, then 80%49 100%

80% with a maximum of $700 per patient

48 The same is true of the WFP and OECD data, which were communicated to the External Auditor in 2017. 49 For hospital care in Italy, 100% up to €260, 80% for the following €240. Different limits apply outside Italy.

202 EX/32.INF.3 – page 27

UNESCO Ceilings for some healthcare expenses

75%

75% (100% for chemotherapy and radiotherapy)

75% 90% 75%

80% with a ceiling of €750 per year and per patient and €500 for orthodontics

ICAO Ceilings for some healthcare expenses

80%50 80% 80% 80% then 100%51 80% 80%

WHO 30,000 for temporary staff and consultants

80% 80% 80% 80% or 100%52 80% 80%53

UPU Not disclosed

ITU 150,000 80% 80% 80 % 80% 80% 80 %

WMO Not disclosed

IMO No 80% 80% 80% 100% up to £550 per day 100% 80 %

WIPO See note54 See note 43 See note 43 See note 43 100%55 See note 43 75 %56

UNIDO No 80% 90% 80% 100%/90%/ 70%57 No

80 % with a ceiling at €1,455 per year

IAEA No 80% 90%58 80 % 100%/90%/80%59 80%

80% up to a ceiling of €1,770.

WFP 30,000 per year 80% 100% Not disclosed

80% with a ceiling of $300 per year

OECD Ceilings for some healthcare expenses

92.5% with a ceiling per treatment in some cases and 100% for electrotherapy, dialysis, chemotherapy and radiotherapy.

92.5% with a ceiling per treatment60

50 80% for brand-name medicines and 90% for generic medicines. 51 80% refund up to $20,000, then 100%. 52 80% refund for a stay in a hospital or clinic in a private room and 100% for a stay in a public ward. 53 80% up to $1,500 per year or $30,000 per year if the healthcare is accident-related. 54 Any insured person over 21 years of age must pay the first 350 Swiss francs (CHF) and 10% of the cost

beyond that amount. However, the cost to the insured person must not exceed CHF2,000 per year. For insured persons under the age of 21, a limit of CHF250 applies to the 10% borne by the participant. The total of the amounts borne by the participant for all family members under the age of 21 should not exceed CHF500.

55 An insured person who chooses a private hospital room pays 10% of the cost of the treatment, with a maximum of CHF1,000, and 10% of accommodation costs with a maximum of CHF850 per day and 100% of costs above this limit.

56 With a maximum of CHF3,500 per year. In France, the reimbursement rate is 85%. 57 100% in a public ward, 90% in a semi-private room and 70% in a private room. 58 For ambulatory surgery not requiring hospitalization.

59100% for a standard room, 90% for a semi-private room and 80% for a private room. 60 Dental care in the OECD is limited to €3,812 per year and per beneficiary in Europe and €6,098 outside

Europe. Orthodontic care is capped at €763 per semester in Europe and €1,220 outside Europe. Dental

202 EX/32.INF.3 – page 28

Source: External Auditor, based on the 2007 report by the Joint Inspection Unit of the United Nations system (United Nations System Staff Medical Coverage) and information communicated by the OECD and WFP in 2017.

113. The rules of the MBF and the Medical Service should, however, be clarified on twospecific points.

114. Article 2.3 of the MBF Rules does not set a minimum period for the registration ofparticipants’ dependent children. It is therefore currently possible to register a child for a shortperiod of less than one year in order for the Fund to reimburse the costs of an operation, thento unregister the child once the operation has been carried out and re-register the child inanother health insurance plan to which he/she is eligible: setting a minimum registration periodof 12 months, for example, would prevent such abuses.

115. The MBF Rules do not provide for a provision on the prevention of health risks forparticipants. Similarly, paragraph 10 of Human Resources Manual Item 7.2, which defines thefunctions of the Medical Service, only provides very partial provisions in this respect.

116. The introduction of a prevention policy deserves to be examined and defined in the rulesof the Fund or the Medical Service. A prevention policy would lead to increased costs in theshort term but would be likely to result in cost savings on expensive treatments in the longterm, as noted by Deloitte. Such measures could be entrusted either to the Medical Service,which has already taken such initiatives and whose responsibilities (pre-employment check-ups and examinations for staff returning to work or changing assignment) already allow thedetection of risks faced by the staff, or to the MBF itself, which could include its implementationin the services of its external administrator, as stipulated in the terms of reference in the callfor tenders relating to the recruitment of that administrator.

Recommendation No. 7: The External Auditor recommends that the rules for registering participants’ dependent children be re-examined.

Recommendation No. 8: The External Auditor recommends that a prevention policy be introduced and the services to be carried out in accordance with this policy be defined in the rules.

(c) Development of the use of the recommended healthcare network

117. The terms of reference in the call for tenders launched by UNESCO to recruit an externaladministrator required the candidates to make available to the MBF:

• an international healthcare network, particularly in countries where theOrganization is present, so as to benefit from preferential rates and third-partycover opportunities;

• and an insurance card justifying the rights of the beneficiaries and giving themaccess to third-party cover, similar to the French “Carte Vitale” (explicitly cited inthe terms of reference).

prostheses are capped at €763 per tooth in Europe and €1,220 outside Europe (one prosthesis for several teeth) or €991 in Europe and €1,525 outside Europe (isolated tooth), and at €1,525 for implants, regardless of the country concerned.

202 EX/32.INF.3 – page 29

118. These provisions are good practice and are recommended by the United Nations Working Group on After-Service Health Insurance (ASHI)61 because healthcare networks have advantages for both the participants and the health insurance plan: they enable insured persons to be certain that their health insurance plan is accepted (which is not straightforward, as shown by the difficulties faced by the MBF with regard to the public hospital system of the city of Paris and its suburbs (AP-HP), mentioned hereafter) and to benefit from cards enabling them to avoid having to advance the share of their healthcare expenses that will be reimbursed to them.

119. They enable the health insurance plan to monitor the quality of services provided by health practitioners, clinics and hospitals, pharmacies and establishments selling or leasing medical devices forming part of the network to control costs by negotiating rates upstream and developing computerized payment arrangements.

120. These advantages are such that certain international organizations’ health insurance plans enable participants to benefit from higher refunds when using the recommended healthcare network.

121. MSH International, the MBF’s external administrator, wants to give MBF participants the possibility to benefit from the Almerys network and is currently testing with some of the staff members of the Bureau of Human Resources Management (HRM) the functioning of a third-party payment card designed for the MBF.

122. The Almerys card should be made available to all insured persons in 2017. It would be useful for the Organization to have MSH International draw up an accurate study of the benefits presented by the network, both for participants and for the MBF, in particular by comparing the costs of using the network with using other service providers. If this study shows that using the network provides significant benefits, a promotion policy should be launched.

(d) Desirable compliance with the article prohibiting the granting of exceptions to the MBF Rules

123. The audit by the internal audit team conducted at MSH International showed the company’s good organization of the healthcare expenses reimbursement process (see Annex 4), which greatly limits the risk of errors such as those found by Buck Consultants in their 2001 report. Out of a sample of 37 files, the audit team found only one partial error.62

124. In contrast, it was found that exceptions to the Rules had sometimes been granted, although they had been strictly prohibited by Article 7.2 of the MBF Rules, which stipulates that “under no circumstances exceptions to these Rules will be granted to any participant”. The following cases were reported to the audit team:

• a participant received the authorization to register a dependent who was neither spouse nor child, despite the abolition of former Article 2.3 (d) of the MBF Rules63

61 See document 201 EX/5 Part IV (B) of 2 March 2017 reporting on the recommendations of the United Nations

working group on ASHI. 62 A claim for the reimbursement of multiple healthcare expenses had been accepted, with the exception of

one expense that had been submitted beyond the deadline of one year following the date of the treatment, whereas all refunds for that claim should have been refused for the same reason.

63 Article 2.3 (d) of the Rules of the MBF, abolished by means of administrative circular AC/HR/16 of 23 June 2011, which authorized the recognition as dependents of the participants their parents, brothers and sisters when no spouse or child was admitted to coverage by the Fund as a protected person, as mentioned above.

202 EX/32.INF.3 – page 30

and an opposing opinion from the Office of International Standards and Legal Affairs (LA);

• a leg prosthesis, for which the 90% reimbursement is capped at €1,500, wasreimbursed as if it were a surgical implant,64 for which the 90% reimbursement isnot capped, an anomaly that was reported to HRM by the complementaryinsurance plan of the insured beneficiary;

• dental implants were reimbursed by exceeding the ceiling for dental care (theceiling is very low);

• slimming products, sexual stimulants (Viagra) and artificial tears (Vismed) werereimbursed, while these products are explicitly excluded from reimbursement byparagraph 6 of Annex I of the MBF Rules;

• a staff member received the authorization to register his spouse, whose salaryexceeded the ceiling allowing affiliation to the MBF, thus enabling the spouse tobenefit from particularly expensive treatment (costing more than €600,000).

125. Some of these derogations were granted following the intervention of senior officials ofthe Organization. Experience shows that it is difficult for the latter to be refused, regardless ofthe organization concerned, whereas when a healthcare insurance plan is not self-insured, theinsurer strictly respects the rules, in accordance with its financial interests and the controls itis subject to. In the event of a request for healthcare reimbursements exceeding the ceilingsin force, the insurer directs the applicant to a less expensive service provider.

126. The Secretariat should therefore reflect on considering how to enforce the prohibition ofexceptions granted with regard to the Fund’s financial rules. There seem to be three possiblemethods: recalling the prohibition through an information circular, explaining that staffmembers who grant exceptions to the rules will be sanctioned; amending the rules byauthorizing exceptions under exceptional circumstances and subjecting them to a specificprocedure (such as consideration by an ad hoc committee and final decision by the Director-General); or renouncing the current self-insurance system and entrusting the day-to-daymanagement of the MBF to an insurance company.

Recommendation No. 9: The External Auditor recommends that the most appropriate measures be taken to ensure compliance with the rule prohibiting the granting of exceptions to the MBF Rules.

3.4 Reforms likely to improve the performance of the Fund

(a) Faster processing of healthcare expenses reimbursement

127. As mentioned above, the International Staff Association of UNESCO (ISAU) has posteda complaint on the Organization’s Intranet site concerning delays in the reimbursement ofbenefits since the new external administrator took over. The following delays were recorded:in the first quarter of 2017, 844 claims (19% of the total) were processed within five workingdays following reception, 559 claims (13%) were processed within seven working days and2,977 (68%) after seven working days; in April 2017, MSH International processed 220 claims(13%) within five days, 87 (5%) within seven days and 1,409 (82%) after seven working days,

64 The amount of the invoice to be repaid was more than 20 times the ceiling of €1,500. The prostheses are listed in Annex 3 under code E6 and the surgical implants under code E7.

202 EX/32.INF.3 – page 31

while the target set by the agreement signed between UNESCO and MSH International was that 95% of claims should be processed within five working days and 99% within seven working days.

128. This situation can be explained by the insufficient information sent to MSH Internationalto calculate the benefits due, and the lack of clarity of certain points in the Rules, which MSHInternational has not always interpreted in the same way as its predecessor, Cigna.

129. MSH International did not receive the exact postal addresses, the correct bank accountreferences (IBAN numbers), or the level of salaries or pensions (necessary to verifycompliance with the maximum disbursement rules per participant) for several participants,which Cigna had not communicated and for which HRM held outdated information (in the caseof retirees). This lack of information made it impossible to calculate part of the repayments andeven resulted in reimbursements made to obsolete bank accounts.

130. The situation has been improving gradually: in May 2017, MSH International processed268 claims (13%) within five working days, 499 (25%) within seven working days and 1,249(62%) after seven working days, and from 1 to 18 June 2017, 390 claims (40%) wereprocessed within five working days, 177 (18%) within seven working days and 398 (41%) afterseven working days. In order to keep the Bureau of Human Resources Management (HRM)informed of changes of address or bank account details, MSH International sends HRMupdated information on its participants every month.

131. Problems relating to the application of the Rules concern, in particular, the followingcases, which have led to exchanges of letters with participants, thus slowing down theprocedure:

• MSH International has requested participants to submit recent prescriptions, whilesome patients have claimed reimbursements for costly treatments such aschemotherapy, based on prescriptions that date back more than one year beforethe treatment concerned;

• the rules for optical and contact lenses were different in the English and Frenchlanguage versions of the MBF Rules;

• MSH International has not agreed to pay for taxis for patients leaving hospital, asthe Rules only provide for transport by ambulance;65

• the rules for the reimbursement of spa treatments, surcharges for doctors’ fees,special treatments (B3) and physiotherapists (B2), depending on whether they arepaid for by the service or by the session, must be specified.

132. The French and English language versions of the Rules have been harmonized. It isdesirable that an official interpretation be given of its obscure points, possibly by amending thewording of the Rules for clarification.

Recommendation No. 10: The External Auditor recommends that the obscure points of the MBF Rules be clarified by providing an official interpretation or by amending the wording of the Rules for clarification.

65 Annex III of the MBF Rules, Code G 1.

202 EX/32.INF.3 – page 32

133. In order to expedite the processing of claims, it would also be desirable for participants to be able to submit all their applications online by scanning all the supporting documents, while the current Rules oblige them to supply original documents66 which they usually send by post. An amendment to the Rules would be preferable on this point. For the sake of security, the external administrator should always be able to request original documents if there is doubt as to their validity and the provision of originals may continue to be required for claims above a certain amount.

Recommendation No. 11: The External Auditor recommends that consideration be given to amending the MBF Rules to expedite the reimbursement of healthcare expenses by allowing online submission of scanned supporting documents, at least below a certain reimbursement amount.

(b) Clearer reimbursement statements

134. ISAU has also complained that the new reimbursement statements do not include the following information, which appeared in documents sent by the previous external administrator:

• the code of the act reimbursed and the official name of that act, provided for in Annex III of the MBF Rules (for example “A3” and “specialist consultation”) ;

• the name of the health practitioner concerned;

• the remaining amount borne by the participant.

135. Some complementary insurance plans have also complained that they do not have this information, which would enable them to process claims faster.

136. MSH International has met with staff representatives and has undertaken to include this information on its reimbursement statements as soon its software can be configured accordingly.

(c) Improvement in relations with AP-HP

137. Article R 6145-4 of the French Public Health Code, amended by Article 2 of Decree No. 2010-425 of 29 April 2010, stipulates that in cases where the healthcare costs of patients “are not likely to be covered by a health insurance plan”, the interested parties “undertake to pay all costs relating to the health plan” and “are required, except in emergency cases, to pay a revolving provision at the time of the patient’s entry into the facility, calculated on the basis of the length of stay, consultancy fees, acts or a provisional average rate of stay determined by the minsters responsible for health and social security”.

138. This wording is open to interpretation as healthcare institutions may or may not consider the MBF to be a “health insurance plan”. The French private clinics generally accept without difficulty to take care of patients affiliated to the MBF.

139. The public hospital system of the city of Paris and its suburbs (AP-HP), which is likely to provide the most complex treatments, has a variable attitude depending on the institution: some facilities agree to take care of patients affiliated to the MBF (and other international

66 Annex VI of the MBF Rules, paragraph 3 (i).

202 EX/32.INF.3 – page 33

organizations) without asking them to sign a payment commitment or pay an advance, while others demand advance payment.

140. In the latter case, relations between AP-HP and the external administrator are complex:AP-HP does not send receipts of payments by MSH International to the company but to thepatients, who forget to forward them to MSH International; reimbursements of anyoverpayments are sometimes paid without specifying their relation to the relevant claim.

141. MSH International has entered into negotiations with AP-HP to obtain systematic patientcare for its participants by AP-HP, without advance payment. AP-HP agrees on the conditionthat MSH International undertakes to pay the remaining 10% of costs borne by the insuredperson.

142. This condition is logical, because AP-HP is exposed to a real risk of non-reimbursementif the insured person has no complementary insurance plan and is retired (if the participant isworking, the remaining expenses borne are deducted from the participant’s salary).

143. MSH International fears that negotiations entered into on these bases will not becompleted for several months. The audit team interviewed AP-HP during the audit to seek itsopinion.

IV. ACKNOWLEDGMENTS

144. The External Auditor extends sincerest thanks to the Directors and staff members of theBureau of Human Resources Management (HRM) and the Bureau of Financial Management(BFM) for their cooperation and the accuracy of the information provided.

End of audit findings.

202 EX/32.INF.3 Annex 1

ANNEX 1

Legal definition of the role of the medical service

1. Human Resources Manual Item 7.2, paragraph 10:

“The Medical Service (HRM/MDS), under the direction of the Chief Medical Officer (CMO), is located at UNESCO Headquarters Fontenoy Building and is open during working hours. An emergency service, also open during working hours, is located in the Miollis building. The functions of the HRM/MDS are:

(a) to carry out medical examinations as required by the Organization, as set out in HR Item 13.12;

(b) to review reports as required on medical examinations undertaken for staff members, candidates for employment and, in certain cases, non-staff members, and to decide on their physical fitness;

(c) to provide free medical advice to staff members. Such consultations are not available to staff members' dependants;

(d) to administer or arrange for the administration of vaccinations and inoculations related to official travel and in such other circumstances as may be required by the Organization;

(e) to administer first aid in cases of emergency and arrange where necessary for the transfer of the patient to hospital or to his/her home;

(f) to help staff members in locating an appropriate doctor, hospital or clinic;

(g) to perform treatments of a continuing nature to staff members, such as dressings or injections, upon presentation of the medical prescription ordering such treatment and under condition that the staff member provides the necessary pharmaceutical supplies;

(h) to examine medical certificates forwarded by staff members absent because of illness or injury, or submitted in support of a request for sick leave, maternity leave, extended maternity leave or paternity leave and to make recommendations to DIR/HRM on whether such leave should be granted;

(i) to conduct inspections in the Headquarters buildings, periodically or upon request by DIR/HRM, to ensure that proper sanitary and other related measures are taken, and to report thereon;

(j) to advise DIR/HRM on any preventive measures that may be necessary as a result of an epidemic, outbreak of an infectious disease or any quarantine order which may affect an individual staff member who has reported a case of infectious disease in his/her household (See HR Item 6.3).”

202 EX/32.INF.3 Annex 2

ANNEX 2

Recommendations by the External Auditor on the funding of UNESCO’s liability for the provision of ASHI

1. Recommendation No. 6 of the 2012 report on the financial position of the Organization as at 31 December 2011. The External Auditor invites the Organization to: (i) consider ways and means of financing the ASHI medium- and long-term liability; (ii) conduct studies comparing the financial costs of the current “pay-as-you-go” financing approach with those of all other financing approaches; and (iii) set itself an objective timetable for taking a final decision on this important matter.

2. Recommendation No. 6 of the 2013 report on the financial position of the Organization as at 31 December 2012. The External Auditor invites the Organization to: (a) consider ways and means of financing the ASHI medium- and long-term liability; (b) conduct studies comparing the financial costs of the current “pay-as-you-go” financing approach with those of all other financing approaches; and (c) set itself an objective timetable for taking a final decision on this important matter.

3. Recommendation No. 3 of the 2014 report on the financial position of the Organization as at 31 December 2013. The External Auditor recommends that the Organization: (i) implement the initial decisions taken by the General Conference relating to after-service health insurance (ASHI) funding, (ii) formulate a long-term funding strategy and (iii) set itself a deadline for taking a decision on ASHI funding.

4. Recommendation No. 2 of the 2015 report on the financial position of the Organization as at 31 December 2014. The External Auditor recommends that the Organization: (i) implement the initial decisions taken by the General Conference relating to after-service health insurance (ASHI) funding, (ii) formulate a long-term funding strategy and (iii) set itself a deadline for taking a decision on ASHI funding.

5. Recommendation No. 1 of the 2016 report on the financial position of the Organization as at 31 December 2015. The External Auditor recommends that the Organization (i) continue to implement measures to fund after-service health insurance (ASHI) and (ii) formulate a funding strategy enabling the long-term sustainability of this debt.

202 EX/32.INF.3 Annex 3

ANNEX 3

Statistics on participants of the MBF as at 31 December 2016

Table 1: breakdown of participants (active and retired) by status and by age as at 31 December 2016

Ages Participants Spouses Children Parents Total 0 to 18 years 1 1,126 1,127 19 to 25 years 3 3 327 333 26 to 32 years 94 38 8 140 33 to 39 years 351 109 10 470 40 to 46 years 514 140 2 656 47 to 53 years 533 145 4 682 54 to 60 years 504 154 1 659 61 to 67 years 583 165 2 750 68 to 75 years 708 168 12 888 Over 75 years 1,209 206 20 1,435 Total 4,500 1,128 1,477 35 7,140

Source: External Auditor, based on data provided by Cigna to the Secretariat.

Table 2: breakdown by age of expenses and reimbursements in 2016 (in euro)

Ages Annual expenses Annual reimbursements under the MBF insurance plan

0 to 20 years 65,844.49 50,503.81 21 to 30 years 24,971.15 19,869.08 31 to 40 years 69,823.91 45,282.23 41 to 50 years 126,761.14 91,243.04 51 to 60 years 187,037.78 141,211.57 61 to 65 years 168,601.33 118,727.51 66 to 70 years 383,682.20 313,959.34 71 to 75 years 230,781.74 174,277.62 76 to 80 years 306,028.84 245,265.71 81 to 85 years 319,289.98 268,541.86 86 to 90 years 229,787.42 193,918.77 91 years and over 173,546.11 137,387.61 Total 2,286,156.09 1,800,164.15

Source: External Auditor, based on data provided by Cigna to the Secretariat.

202 EX/32.INF.3 Annex 4

ANNEX 4

Organisation of the internal oversight of MSH International. The external administrator of the MBF

1. Claims for reimbursements and their supporting documents are sent to MSHInternational every day by courier from UNESCO Headquarters or directly by post. The originalsupporting documents are then scanned and processed. The receipt of originals is mandatory,in accordance with the Rules of the MBF (Annex VI – 3 of the 2008 and 2014 Rules).

2. Some hard copy files that have specific features preventing them from being reconciledwith the computer software used by MSH International are processed manually and notscanned and digitalized.

3. In the event of loss of documents, copies or duplicates of supporting documents areaccepted on an exceptional basis.

4. As indicated above, the maximum period for filling claims for reimbursement is one yearfrom the date on which the expenditure is incurred, prompting some participants to submitbundled claims for the reimbursement of different healthcare expenses incurred over severalmonths.

(a) Data entry

5. Data entry is carried out by the administrators of MSH International. The system doesnot allow data to be entered for persons other than participants and their dependents, eachidentified by a unique UNES number. Reimbursement rates are set automatically in thesoftware (a module of the enterprise resource planning (ERP) system “Oracle”): theadministrator simply enters the full amount of the healthcare expense incurred and thesoftware automatically calculates the amount to be reimbursed to the participant in accordancewith the Rules of the MBF. The only possible error therefore stems from a manual input errorwith regard to the date, the patient number, the code of the healthcare act or the full amountof the healthcare expense incurred. Any such data entry errors are therefore priority risk areasto be controlled.

(b) The first level of control is supervision by the Head of Department

6. The level of supervision depends on the experience and level of the administrator whoenters the data and is detailed as follows:

− unexperienced administrators (two out of eight) are 100% supervised;

− level 1 experienced administrators (also two out of eight) are supervised for reimbursements of more than €1,000;

− level 2 experienced administrators (four out of eight) are supervised for reimbursements of more than €5,000.

7. The Head of Department supervises the claims by conducting consistency checks onthe nature of the healthcare expense claims submitted for reimbursement by looking forunusual items and making checking manually entered data against the supporting documents.

202 EX/32.INF.3 Annex 4 – page 2

(c) The second level of control is medical checks

8. The medical team at MSH International conducts additional checks in the following fourcases:

− serious pathologies (the list of which is predefined under ICD codes);

− hospitalizations of more than 10 days;

− reimbursement of more than €10,000;

− reports to the medical team by the Head of Department, in particular owing to the complexity of the case or presumption of fraud (case management).

9. The files concerned are scanned and transferred to the medical team of MSHInternational, which makes additional checks (in particular, by verifying the consistency ofpatients’ medical history and the consistency of their claims in order to detect potential fraud).

(d) The third level of control is internal audit

10. Once every quarter, the internal audit team at MSH International checks a significantsample of all processed claims. An audit report is drawn up internally as a result of thesechecks.

(e) The fourth level of control is the watchfulness of participants

11. In the event of error or omission, in spite of the different levels of control, the risk of afinal error in the amount of claims for healthcare reimbursement is reduced by the participants’own vigilance concerning the reimbursements received.

12. This level of control cannot be regarded as reliable in the event that reimbursements toparticipants are greater than what is owed.

(f) Conclusion

13. Internal control of reimbursements is organized into three distinct levels, theoreticallycovering all identified risks (completeness, authenticity, measurement, duplicate payment andfraud). The system in place appears to be robust and should significantly reduce the risk ofanomalies.

Impreso en papel reciclado