South Korean Health System Overview
Health System Rankings
Health System Outcomes
Coverage and Costs for Consumers
South Korea’s COVID-19 Policy
“The greatest achievement over the past 40 years, since the introduction of Korea’s NHI, is the expansion of coverage for the target population. The key success factors of Korea, one of the representative countries that achieved UHC [Universal Health Coverage] within a short period of time, are as follows. The first is changes to the socio-economic conditions. Korea has successfully achieved rapid economic growth by successfully implementing the 5-Year Economic Development Plan (Yoo 2008). There was a strong public demand for health insurance in 1987, and the establishment of the NHI [National Health Insurance] was a promise made during the presidential election. The second factor is the design of health insurance scheme. At launch, health insurance began with low levels of contribution, benefits, and reimbursement owing to the poor financial condition of the government. The current NHI system is the result of expanding coverage systematically, keeping in view individuals with relatively less understanding of the social insurance mechanism. The third contributing factor is the development and implementation of a strategic policy for health insurance. The government imposes mandatory participation, as legal obligation for both insurers and providers, and insurers must provide NHI services. The step-by-step expansion of coverage took into careful consideration the insured’s ability to pay and the insurer’s administrative capacity. By gradually expanding population coverage, Korea established the NHI 12 years after the introducing the health insurance system. Finally, the fourth factor is the use of information technology. In Korea, the government operates the residential identification system. This technology makes efficient management possible, enabling eligibility criteria management, imposition, collection, benefit management, claim review, etc.”
Source: Lee, Y., Kim, S., Kim, S. Y., & Kim, G. (2019). Ethical Consideration of National Health Insurance Reform for Universal Health Coverage in the Republic of Korea. Asian bioethics review, 11(1), 41–56. https://doi.org/10.1007/s41649-019-00079-1.
“The Republic of Korea achieved universal health coverage in 1989, with the entire population being covered by either national health insurance or the tax-based Medical Aid Program. In contrast to public health financing, health-care delivery relies heavily on the private sector, though some public health facilities provide medically necessary services at the central, regional, and municipal levels.”
Source: World Health Organization. Regional Office for the Western Pacific. (2015). Republic of Korea health system review. Manila: WHO Regional Office for the Western Pacific.
“As noted thus far, national health insurance finances the Republic of Korea’s health system. The NHI covers about 97% of the population, and the remaining 3% is covered by the Medical Aid Program, a tax-funded program to ensure access to health-care for low-income citizens. In contrast to the public sector-dominant financing, health-care delivery relies heavily on the private sector. This is because the Government has let health-care providers in the private sector directly respond to increases in the demand for health-care that social health insurance has brought about. As of 2012, almost all clinics and about 94% of hospitals were privately owned.
“Public health facilities provide medically necessary services not only for the general public but also target populations at the central, regional, and municipal levels. They include national hospitals, special corporatized public hospitals, regional medical centres, health centres, health subcentres and primary health-care posts.”
Source: World Health Organization. Regional Office for the Western Pacific. (2015). Republic of Korea health system review. Manila: WHO Regional Office for the Western Pacific.
“In South Korea the process of merging began with HIFs for self-employed workers, teachers and government employees in October 1998 and by merging these schemes together the National Health Insurance Corporation (NHIC) was created. In July 2000, the HIFs [Health Insurance Funds] for industrial workers were merged with the NHIC, and the national health insurance of Korea became a single payer insurance system. The NHIC had separate HIFs for government and school employees, industrial workers and the self-employed. The HIFs for industrial workers and government and school employees were merged together in 2001 and this new fund was merged with the fund of the self-employed in 2003. Therefore, the single payer system was established in 2003 [13].””
Bazyar, M., Yazdi-Feyzabadi, V., Rashidian, A. et al. The experiences of merging health insurance funds in South Korea, Turkey, Thailand, and Indonesia: a cross-country comparative study. Int J Equity Health 20, 66 (2021). https://doi.org/10.1186/s12939-021-01382-w.
“Outcomes of health services are mixed. Even though the vaccination rates in absolute terms are relatively high, it was found that full completion rates leave room for improvement. The quality of acute care has also improved significantly. However, in spite of the rapid increase in health investment, “it is not evident that the system is delivering proportionately higher quality care”.
“Inequalities in health outcomes are evident in both men and women from birth to death between different socioeconomic strata. Regional health inequalities are observed between Seoul and other areas as well as between rural and urban areas. Between genders, a substantial female excess in ill-health (measured by self-reported health and chronic diseases) was reported.
“Personal health expenditure represents 89.1% of total, with limited role of public health. At the health system level, no formal mechanism for setting priorities and resource allocation is available. From the perspective of technical efficiency, the number of annual outpatient visits per active medical doctor is much higher than in other OECD countries, and the number of inpatient discharges per active medical doctor is a little higher than the OECD average. However, the length of stay is much longer than other OECD countries and pharmaceutical expenditure has been higher than in other high-income countries.”
Source: World Health Organization. Regional Office for the Western Pacific. (2015). Republic of Korea health system review. Manila: WHO Regional Office for the Western Pacific.
“Despite great progress in the system in the past 40 years, some limitations remain. First, although population coverage is comprehensive, there is insufficient benefits coverage. Although the medical necessity is recognised, there is insufficient uninsured benefit, such as not paying from health insurance owing to inadequate health insurance financing; thus, attributing to listed uninsured standard and non-standard services. Therefore, the coverage is limited in depth. Second, there is a lack of protection mechanism when the rate of catastrophic health care expenses is high. The financial burden on the low-income class registered in the NHI [National Health Insurance] is substantial, and households often go bankrupt from health care expenses. The low-income population has limited access to insurance owing to high OOPs [Out Of Pocket Payments] and uninsured services. In addition, while many higher-income individuals have private insurance since the amounts covered by NHI are limited, the low-income population does not have the capacity to buy private insurance. Third, the financial stabilisation system of health insurance is insufficient, and it is necessary to consider diverse financial resources. The current NHI fund depends on premiums and government subsidies. As the burden of disease (and associated medical needs) increases with ageing and non-communicable diseases, the financial resources should also be increased. Some countries are introducing an automatic alteration system that raises or lowers insurance premiums depending on the financial situation of the NHI. In addition, the tax on alcohol, carbonated beverages, and junk food, which causes obesity, can be considered as a source of health insurance financing.”
Source: Lee, Y., Kim, S., Kim, S. Y., & Kim, G. (2019). Ethical Consideration of National Health Insurance Reform for Universal Health Coverage in the Republic of Korea. Asian bioethics review, 11(1), 41–56. https://doi.org/10.1007/s41649-019-00079-1.
Health Systems Facts is a project of the Real Reporting Foundation. We provide reliable statistics and other data from authoritative sources regarding health systems in the US and several other nations.
Page last updated May 19, 2021 by Doug McVay, Editor.
