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Illan Nam, Colgate University, Feb 2011Draft in progress, please do not quote or citeKOREAIn 2000, the South Korean National Assembly passed legislation that integratedthe country’s fragmented corporatist healthcare insurance societies into a nationaluniversal single-payer health insurance system managed by the state. The “IntegrationReform” represented the culmination of a series of changes to the healthcare system thatsignificantly expanded coverage and increased the system’s mechanisms ofredistribution. Between 1987 – the year of democratic transition – and 2001, coverageexpanded from 41% of the population to 97%. At the time of transition, only formalsector workers who were employed by firms larger than 100 workers – were guaranteedinsurance through their employers. In a succession of measures, the first democraticallyelected government of Roh Tae-woo expanded coverage to the rural and informal sectors.In 1987, farmers were handed out healthcare insurance cards. Two years later, a programto cover the self-employed was implemented. These extensions were achieved throughthe incremental establishment of quasi-private insurers that pooled workers by workplaceor geographic location. As a result, South Korea’s health insurance system came toresemble a corporatist system that was composed of hundreds of quasi-private insurers,each of which offered different benefits packages and charged different premiums todifferent pools of workers. The system generated considerable inequity between largecompanyand small-company employees and between urban and rural workers, asworkers at large companies paid lower premiums and received better benefits while theself-employed/informal and rural workers paid higher premiums for poorer services. By8
Illan Nam, Colgate University, Feb 2011Draft in progress, please do not quote or citeconsolidating all of these separately-run schemes into a single payer fund, the 2000legislation reduced systemic inequity.THAILANDIn 2001, the Thaksin Shinawatra government passed legislation that extendedcoverage to 18.5 million people (or 27% of the population) who were previouslyuninsured. Following the institution of the “30-baht card” scheme, the coverage rate inThailand reached 95.6%. Prior to this reform, Thailand’s health insurance programsconsisted of four separate schemes that covered different segments of workers: civilservants, formal sector workers, the rural poor, and low income families and theirdependents. These various programs, which were separately managed, had beenintroduced on a piecemeal basis between 1975 and 1990. All of these programs chargedwidely varying benefits and fees that generated considerable inequity in healthcareinsurance. The objective of the 2001 legislation was to provide equal access to qualitycare regardless of a citizen’s socioeconomic qualifications. To ensure this, the “30 bahtcard” program guaranteed that no citizen would pay more than 30 baht on any clinic visit,including for pharmaceuticals. While some procedures were exempted (cosmeticprocedures, chemotherapy, renal dialysis, organ transplants), the “30 baht card” improvedaccess to care for groups who were previously uninsured. At the same time, the initialproposal’s call to merge these programs with those covering formal sector workers into asingle universal program was fiercely resisted by civil servants and formal sector workerswho wanted to maintain their separate programs and not risk a diminishment of theirbenefits packages.CHILE9
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