A poor attempt
The government’s sudden decision to drop its plan to redesign premium levies on national health insurance has received more criticism than praise. Lee Kyu-sik, a Yonsei University professor who has led the taskforce to reform the national health insurance program since July 2013, quit his job after lambasting the government for being irresponsible. Other members of the taskforce, mostly professors and representatives from labor unions and the civic sector, turned down a lunch invitation from Health and Welfare Minister Moon Hyung-pyo in protest. Lee and the other team members are all experts on health insurance.
Instead of adopting the expert group’s recommendations to raise insurance premiums on higher-income groups and lower those for the less affluent population, the government said it will tweak the tax system for low-income subscribers who do not pay through their employers. The move will effect 5.99 million households with a registered income of less than 5 million won ($4,500). It wants to lower the guidelines on estimating the income of subscribers who are not on regular corporate payroll and insurance coverage. Individual subscribers’ health insurance contributions are calculated based on gender, age and ownership of a car or other assets.
But the government has missed the target with its public health insurance reform. The problem is not in easing the contributions. The asset evaluation itself is not fair to the average person. A newborn is immediately levied with an insurance premium of 3,560 won. That cost nearly triples when a person turns 20. Cars are overvalued. An extra 10,000 won is added for a commercial vehicle. Income level is evaluated including assets. It is a double levy. The calculation is so complex that even the insurance agency’s staff do not entirely understand it.
The reform taskforce recommended that the evaluation be scrapped. All lower-income households should pay a fixed rate regardless of their income documents. The losses should be covered by higher premiums paid by high salary-earners and their families. There are about 190,000 dependants who earn 20 million won and yet are exempt from insurance fees. There are also 160,000 people who get returns of 20 million won a year on their retirement pension. They enjoy free public insurance benefits as well as higher returns than ordinary citizens. The government’s plan to tweak some parts of the public insurance program will help no one. Public health insurance runs entirely on contributions from the people. The people won’t tolerate makeshift solutions.
JoongAng Ilbo, Feb. 3, Page 30