Towards universal coverage: an evaluation of the benefit enhancement plan for four major conditions in Korean National Health Insurance

ABSTRACT

Owing to low contributions and a limited benefits design, the Korean National Health Insurance (NHI) took only 12 years from its establishment to achieve universal population coverage. However, the NHI has been facing critical challenges like high out-of-pocket payment rates and catastrophic health expenditures because of low contributions and a limited benefits design. In response to these challenges, in 2013, as a major move towards universal coverage, the Korean government declared a plan to radically enhance the benefit coverage for four major conditions, including cancers, cardiovascular and cerebrovascular diseases, and rare diseases. This study aimed to evaluate the benefit enhancement plan for these four major conditions and identify key success factors. Four major strategies were adopted to enhance benefit coverage 1) covering almost all previously non-covered medical services either as essential or discretionary benefits, except for definite non-essential services such as cosmetic surgery; 2) improving conditions for benefit coverage corresponding to current scientific knowledge; 3) reducing high out-of-pocket payments considering income level; 4) reducing the financial burden from three major non-covered services including physician surcharges, private room charges, and private charges for custodial care. Despite impaired equity in financial protection across conditions, the plan is expected to reduce out-of-pocket payments by 10% in four major conditions. The actual impact of the plan should be evaluated after implementation. For the successful implementation of the plan, we need to strengthen the NHI's strategic purchasing by establishing a new benefit management system, improving claims review processes, and providing financial incentives rewarding quality and efficiency of care.