This Year, Health Insurance Premium Rate Surpasses 7% for the First Time
National Health Insurance Expenditure Burden Increases
Government Pledges to Minimize Premium Rate Increase Next Year
Civic Groups Demand "Freeze, Not Even a 0.01% Increase"
The decision on whether next year's health insurance premiums will be frozen at this year's level or increase by less than 1% will be made on the 26th. The increase in the health insurance premium rate for next year is expected to be the lowest since it was frozen in 2017, ensuring a slight reduction in the national medical insurance burden. However, as the premium rate has reached the 7% range of income, some civic groups are strongly urging for a freeze.
According to the Ministry of Health and Welfare and the National Health Insurance Service on the 26th, the Ministry will hold the Health Insurance Policy Deliberation Committee (HIPDC) at 2 p.m. to finalize next year's premium rate. It is highly likely that the increase will be decided between two options: freezing or a slight increase in the 0% range. HIPDC members are expected to weigh the sustainability of health insurance and the general election about seven months away, continuing discussions on the premium rate increase until the last moment.
Except for 2017 when the rate was frozen, the premium rate has been on the rise. The average increase rate over the past 10 years is 1.90%. Looking at the trend over the past five years, the increase rate (2.7%) is even steeper. It was 3.49% (6.46%) in 2019 → 3.20% (6.67%) in 2020 → 2.89% (6.86%) in 2021 → 1.89% (6.99%) in 2022 → 1.49% (7.09%) in 2023.
During the previous administration, the coverage of health insurance for MRI, CT, ultrasound, etc., was strengthened, increasing the national medical insurance burden. Therefore, this year, the premium rate surpassed 7% of income for the first time in history. This is why the government declared in the ‘2023 Second Half Economic Policy Direction’ announced in July that it would minimize the increase in the 2024 premium rate considering the national burden.
Currently, the financial soundness indicators of health insurance are relatively positive. The accumulated reserves of the National Health Insurance reached 23.8701 trillion KRW (as of last year), the highest ever. The current balance of health insurance recorded a surplus of 3.6291 trillion KRW for two consecutive years.
With the health insurance authorities deciding to reduce coverage for frequently used high-cost treatments starting this year, there is a possibility that the health insurance fund could become more ample. For example, for MRI, whose medical expenses increased tenfold after being covered by health insurance since 2018, patients will have to bear 100% of the cost from next month if the scan is done for simple headaches or dizziness.
However, it is known that some committee members believe that even if the premium increase is minimized, an increase close to at least 1% is necessary. According to the National Health Insurance Service, a 1% increase in the premium rate would generate an additional revenue of 737.7 billion KRW per year.
However, since the decision on next year's premium rate has been delayed for over a month and will be announced just before the Chuseok holiday, the approaching general election next year is a political variable. Premium increases reduce the actual monthly salary received by employees, which is said to have a significant impact on voter sentiment. The Free Medical Movement Headquarters stated, "Workers and low-income people are suffering under years of inflation, interest rate hikes, and premium rate increases," and urged, "It should be frozen, not increased by even 0.01%."
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