Benefits Extension of Health Insurance in Korea: Impacts and Future Prospects

Whereas Korean health insurance achieved universal coverage of population in 1989, out-of-pocket (OOP) payments has been a major concern because it is as high as about 35% of total health expenditure. Several policies to expand the benefit coverage of National Health Insurance (NHI) were implemented around the year 2005; for example, cost sharing of 20~50% was reduced to 10% for catastrophic illnesses; ceiling on OOP payment was implemented for covered services. This study analyzed the extent to which the policy of expanding benefit coverage for cancer patients reduced income-inequality in health care utilization, the use of tertiary care hospital, and catastrophic payment. Using nationwide claim data of NHI, this study is based on the triple difference estimator to compare cancer patients as a treatment group with liver disease or cardio-cerebrovascular disease as control groups and low-income group with the highest-income group. The results showed that the utilization of outpatient and inpatient services increased more (or decreased less) among low-income patients than high-income ones after the introduction of the policy. For the use of tertiary care hospitals, inpatient admissions increased more in low-income cancer patients than those of high-income ones, but not outpatient visits. While catastrophic payment decreased among cancer patients, high-income cancer patients experienced a greater decrease than those of low income did. Although Korea expanded benefits coverage for catastrophic illnesses, policy debates continue due to insufficient financial protection, which also depends on provider behavior and potential demand inducement associated with the provision of uncovered services and specialist services with high fees. Politics of increasing benefits coverage in Korean NHI will be discussed too.

 

Soonman Kwon is Professor and Former Dean of the School of Public Health, Seoul National University, South Korea. After he received Ph.D. from the Wharton School of the University of Pennsylvania, he was assistant professor of public policy at the University of Southern California in 1993-1996. Prof. Kwon has held visiting positions at the Harvard School of Public Health, London School of Economics, and University of Toronto. He was the president of the Korean Association of Schools of Public Health in 2013-2014 and is the Presidents-Elect of Korean Health Economic Association and Korean Gerontological Society. Prof. Kwon has been on the editorial boards of Social Science and Medicine, Health Economics Policy and Law, BMC Health Services Research, and Ageing Research Reviews. He was the editor of the Korean Journal of Public Health in 2007-2009 and currently the editor of the Korean Journal of Health Economics and Policy.

 

Sujin Kim is a Takemi fellow in Harvard School of Public Health, interested in how public policy impacts health, health care utilization and health inequality. Sujin currently does research on the role of public policy in elderly depression, impact of health screening policy, and the impact of pharmaceutical pricing policy on provider’s behavior. She has published papers in Health Policy and International Journal of Health Care Finance and Economics. She received her Ph.D. in health policy and management in 2013 from Seoul National University, where she analyzed how policy of expanding NHI benefit coverage in Korea affected inequalities in health care utilization and expenditure. She received M.P.H. in health policy and management and B.Pharm in pharmacy from Seoul National University in 2008 and 2001, respectively.