Divergent Trajectories: Healthcare Insurance Reforms in East Asia ...

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Illan Nam, Colgate University, Feb 2011Draft in progress, please do not quote or citelanguage of the debate about the state and its responsibilities for social welfare spending.Whereas during the 1970s and even 1980s, the notion of state responsibility for welfareprovisioning would have struck ordinary citizens in Korea and Taiwan as unfamiliar oreven as an “unpatriotic” burden that impeded the state’s more urgent and overridingobjective of pursuing national economic growth, by the 1990s, citizens’ attitudes hadshifted dramatically. Leftist newspapers, intellectuals and activists, and civil societyorganizations stridently called upon the state to deliver protection to vulnerable citizensand to create a nation based on socioeconomic equality.Welfare state development in Latin America and East Asia are marked by twodistinct outcomes. The first is along the dimension of universality of access, and thesecond along the dimension of solidarity or redistribution. Among the patterns thatemerge, we find that in several countries in East/Southeast Asia – Thailand, South Korea,and Taiwan – over the course of the 1990s and 2000s, more and more citizens came tobenefit from a universal access to healthcare. Whereas the reach of the healthcareprograms previously had been confined to a select group of formal sector workers,benefits were expanded to encompass more segments of the population, most notably therural and informal sector workers. However, we also find that reforms that greatlyimproved the solidarity and equity of programs were undertaken in only some East Asiancountries. For instance, while in Korea and Taiwan, single-payer national funds wereestablished that enhanced the solidaristic elements of healthcare insurance across bothformal and informal sector workers, in Thailand, separate programs continued to bemaintained for formal sector workers.4
Illan Nam, Colgate University, Feb 2011Draft in progress, please do not quote or citeIn contrast, in Latin America, during the 1980-90s, most countries put in place amixed system of private-public health systems. While healthcare systems in thesecountries ostensibly extended access to all citizens, in reality, coverage in many countriesfell short of being universal. Moreover, inevitably, lower-income citizens were pricedout of the private system and came to be concentrated in the public health sector,burdening the latter with a greater pool of higher-risk patients and creating a dual systemof care that discriminated between higher- and lower-income citizens. As a result, poorercitizens often faced healthcare provisioning that was plagued by lower quality services,overcrowding, and lack of capacity. Policymakers sought to ameliorate some of theseproblems through measures that improved access, particularly for the lowest incomegroups. On the other hand, efforts at integrating the public and private systems havebeen far more limited, and hence, the degree of redistribution or equity within thehealthcare system is low.Why do we see variation with respect to these two dimensions of healthcarereform, both within as well as across regions? I argue that the divergence in policyoutcomes depended upon two factors: first, the nature of electoral party competition inthese new democracies provided different incentives and payoffs to parties forimplementing universal versus targeted social policies. I claim that where party systemsare less institutionalized, have weakly nationalized presences, and are underpinned byanemic or fluid partisan attachments, a universalizing social policy initiative is morelikely to yield greater electoral payoffs. In this kind of electoral landscape, sweepingsocial policy initiatives may be efficacious means of replacing clientelistic networks oroverlaying new socioeconomic cleavages that create more programmatic partisan5
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