Health insurance not fair

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Health insurance not fair

Inconsistency in medical insurance may fuel public skepticism and distrust about the national health care insurance system amid deepening deficits due to poor operation and the aging of Korean society. Differences in guidelines for corporate and public plans has caused insurance bills to vary between company-sponsored and self-employed programs, as well as between corporate and regional subscribers.

Employer-sponsored subscribers get taxed 5.64 percent of their income for national health coverage, of which employees and companies equally shoulder half. Meanwhile, insurance fees for regional-program subscribers are deducted from general income, property and automobile taxes. Medical insurance fees naturally change if one quits or gets a new job. The problem is that insurance premiums also climb. For example, the 643,000 people who left the workforce in 2009 saw their average monthly health insurance fees shoot up to 81,519 won ($75) on average, compared with 36,715 won when employed. It’s too harsh to slap expensive health care costs on an individual just as he or she loses corporate coverage.

Generally, a person is without income when he or she loses a job or retires. But if he or she still owns an apartment or a car in urban areas, that person is required to pay medical insurance fees of more than 100,000 won - as much as a person earning 3.6 million won a month working for a company. People need to own a house or car when they lose a job, but in some cases they have to sell them for fear of higher insurance payments.

A discrepancy among corporate beneficiaries is also a problem. There are 1.47 million “wealthy” working people who reported a cumulative income of 21 trillion won from their earnings from business deals, rental income or dividends. Yet they are not levied extra for their nonsalary income. Among family members who get listed as beneficiaries on corporate coverage are also the wealthy with individual incomes or pensions. Some attempt to manipulate the loophole in the system by listing their names on corporate coverage.

These discrepancies were foreseeable when the corporate and regional insurance systems were merged in 2000. But for the last 10 years, the government turned a blind eye to the deepening inequalities. The merger obviously cannot be undone. But health costs must be less severe on the unemployed and low-income bracket. The government must come up with better ways for a fair health insurance system.

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