What entities may experience alterations due to the shifts in OSMS?
As of July 14, 2025, Kazakhstan has embarked on a significant update to its mandatory social health insurance system. The reforms, scheduled to be fully implemented by 2027, aim to expand access, strengthen social justice, and fortify the financial stability of the system.
Key Changes in the Social Health Insurance System
VAT Exemptions and Tax Code Adjustments
Part of the new reforms includes the introduction of VAT exemptions for compulsory social health insurance (CSI) services and guaranteed free medical care, effective from January 1, 2026. This move is intended to reduce the tax burden on health insurance services, helping to maintain affordability and support low-income individuals indirectly.
Simultaneously, the standard VAT rate will rise from 12% to 16%, while reduced VAT rates will be applied to medicines and medical services (5% in 2026, increasing to 10% in 2027). This approach balances fiscal needs with continued support for healthcare affordability.
Transition to a Full-Fledged Insurance Model
By 2027, the social health insurance system is set to transition into a full-fledged insurance model, moving Kazakhstan from a mixed or limited model of social health financing towards a more comprehensive insurance-based system. This progression is expected to improve sustainability and equity in health coverage.
Impact on Low-Income Individuals
The VAT exemptions and tax code adjustments aim to make basic health insurance and care more accessible and affordable to vulnerable populations. Additionally, the increased deductions and progressive income tax rates introduced alongside these reforms support social protection mechanisms that benefit low-income groups.
Despite these improvements, challenges remain in achieving equitable access, particularly for rural populations and for mental, reproductive, and adolescent health services. These areas are recognized as priority areas requiring further strengthening in line with the country's Universal Health Coverage goals.
Expanding Coverage and Financial Support
Starting January 1, 2026, citizens categorized as being in crisis or emergency levels of social well-being (categories D and E) will be connected to the system, affecting around 1 million people, which is a 5% increase in low-income individuals.
The government's contribution to the SMIS will be gradually increased, starting in 2027, with the aim to reach 4.7% by 2037.
Encouraging Participation for All
For those not yet participating in the SMIS, voluntary enrollment is suggested, as the cost is considered insignificant compared to the treatment of serious illnesses. The same applies to officially registered unemployed individuals, with their participation in the system being covered by local budgets.
Starting in 2027, Kazakhstan will transition to a full-fledged insurance model where responsibility for health is shared between the state, employers, and citizens themselves. Currently, 16.9 million people are insured in the system, which is 82.6% of the country's population.
City Polyclinic No. 4 in Astana, under the direction of Director Serik Shaimerdenov, is ready to help individuals understand and complete necessary documents for the SMIS, including registration for temporary unemployment and voluntary enrollment.
In summary, Kazakhstan’s 2025 reforms lay the groundwork for a more inclusive and sustainable health insurance system by 2027, with VAT exemptions and tax code adjustments designed to support low-income individuals while transitioning to a full insurance model. However, persistent gaps in access and equity highlight ongoing challenges to be addressed in this transition.
The social health insurance reforms in Kazakhstan, effective from 2026, introduce VAT exemptions for CSI services and free medical care to help maintain affordability for low-income individuals. Additionally, the transition to a full-fledged insurance model by 2027 promises improved equity in health coverage and greater financial support for low-income individuals.
