IMSS: the employer enrols the worker

Salaried workers in Mexico are covered by the Instituto Mexicano del Seguro Social (IMSS) under the Ley del Seguro Social. Article 15 of that law requires employers to register with IMSS and enrol their workers. The worker does not sign up alone. Enrolment by the employer is what makes the worker, and the family members they register, eligible for IMSS medical care.

The mandatory regime in article 11 has five branches: work risks, sickness and maternity, disability and life, retirement and old age, and childcare and social benefits. Medical care comes through the sickness and maternity branch. For a US company the practical point is plain: hiring someone in Mexico as an employee means that someone, either your own Mexican entity or an employer of record, holds an IMSS employer registration and enrols that person.

Family members on the IMSS record

An IMSS-insured worker can register beneficiaries: a spouse or partner (concubina or concubinario in the law’s terms), their children, and their parents when the parents depend on the worker financially and live with them. Knowing that reach helps when you decide whether a private benefit should extend to dependants as well.

Beneficiaries are registered at the worker’s assigned family medicine clinic (Unidad de Medicina Familiar, UMF) or online through IMSS Digital, and children can be added online with their CURP, Mexico’s personal population registry code. Each of those steps uses the worker’s IMSS social security number (número de seguridad social, NSS), so make sure the employee and whoever runs payroll have it on file from the start.

Gastos médicos mayores as the private benefit

The usual private health benefit in Mexico is major medical insurance, seguro de gastos médicos mayores, often shortened to GMM or SGMM. Mexican HR guides and press describe it as cover that lets the employee use private hospitals and pays toward surgery, hospital stays, medicines and rehabilitation after an accident or illness.

No law requires an employer to provide it. Local payroll guides describe GMM as a benefit above the legal minimum, offered mostly by medium and large employers, that adds to IMSS without replacing the employer’s IMSS duties. That is useful context when a small US company compares its offer with what larger local employers provide.

Why the insurer’s home country matters

Mexico’s Ley de Instituciones de Seguros y de Fianzas (LISF) limits who can carry on insurance business. Article 20 reserves it to authorised insurance institutions. Article 21 generally bars contracting personal insurance (seguros de personas) with foreign companies when the insured person is in Mexico, article 22 lets the regulator, the Comisión Nacional de Seguros y Fianzas (CNSF), grant exceptions, and article 23 bars offering that kind of insurance in Mexico.

For a US employer, an overseas health policy bought online for a Mexico-resident employee is therefore not a straightforward purchase. Whether a particular plan can cover someone living in Mexico is for the insurer to confirm under those rules. Our overview of international health insurance for remote employees explains how global plans are used in other countries.

Whatever route you take, an international plan cannot replace IMSS enrolment, which is mandatory for employees. Private cover of any kind only adds to it.

Hiring after the 2021 outsourcing reform

A labour reform in force since 24 April 2021 bans general subcontracting of personnel in Mexico. Law-firm commentary on the reform explains that only specialised services outside the client’s core business remain allowed, and that their providers must register in the Labour Ministry’s REPSE registry.

The two usual routes are your own Mexican entity, which registers with IMSS and enrols the employee, or an employer of record that acts as the legal employer and handles IMSS enrolment. Because the 2021 rules changed what outsourcing can cover, an EOR arrangement deserves a careful look before anyone starts work. Check the structure, and the tax treatment of any medical premium, with a local adviser or tax professional in Mexico.

Paying someone as an independent contractor leaves health cover in their hands, and it raises classification questions of its own. Our page on health coverage for EOR employees and contractors abroad sets the routes side by side, and the guide to employees vs. independent contractors in California shows how differently a US state approaches the same question.

Getting connected with a benefits partner

Send us the basics through the form on this page: the Mexican state where your employee lives, how many people you employ there, which family members are on their IMSS record, and whether you hire through your own entity or an EOR. We forward it to a benefits partner focused on internationally distributed teams, and from there the partner and the insurer decide eligibility, plans and pricing. Our guide to employee benefits for small businesses covers the wider benefits picture.

A few useful answers

Common questions

Can a US company skip IMSS if it buys private medical insurance?

No. IMSS enrolment is mandatory for employees in Mexico, and private medical insurance only adds to it. The employer, or an employer of record acting as the legal employer, still registers with IMSS and enrols the worker.

What is gastos médicos mayores?

It is major medical insurance, the usual private health benefit in Mexico. It lets the employee use private hospitals and pays toward surgery, hospital stays, medicines and rehabilitation after an accident or illness.

Can an employee living in Mexico be covered by a foreign insurer?

Mexico’s insurance law, the LISF, generally bars contracting personal insurance with foreign companies when the insured person is in Mexico, and lets the regulator, the CNSF, grant exceptions. Whether a given plan can cover a Mexico-resident employee is for the insurer to confirm.

Which family members can use IMSS?

A registered worker can add a spouse or partner, their children, and parents who depend on them financially and live with them. Beneficiaries are registered at the worker’s family medicine clinic or through IMSS Digital.

Does the 2021 outsourcing reform affect hiring through an EOR?

It can. Since 24 April 2021 general subcontracting of personnel is banned, and law-firm commentary says only specialised services outside the client’s core business, from providers registered in REPSE, remain allowed. Review any EOR setup against those rules before the employee starts.

International Health Insurance for Remote Employees in Mexico