Health Insurance Revenue Exceeds Expectations... Cumulative Reserves Reach 17.8 Trillion Won

National Health Insurance Service, 2019 Financial Operation Results
Initially Expected Deficit of 3.2 Trillion KRW, Actual Deficit 2.8 Trillion KRW
"Increase in Subscribers and Insurance Premiums on Interest and Rental Income of Employees"

▲National Health Insurance Service

[Asia Economy Reporter Choi Dae-yeol] Last year, health insurance revenue exceeded the initial plan by more than 400 billion KRW. Although expenditures increased due to the health insurance coverage enhancement policy, known as Moon Jae-in Care, the increase was limited to about 60 billion KRW more than expected.

According to the National Health Insurance Service's announcement on the 18th regarding last year's health insurance financial operation results, the cash flow-based finances decreased by 2.8243 trillion KRW compared to the previous year. This scale is 339.3 billion KRW better than the projected current balance deficit (3.1636 trillion KRW) announced in the comprehensive health insurance plan by the government in May last year. It was expected that the deficit for the year would exceed 3 trillion KRW, but the actual deficit was smaller, indicating a relatively good performance. As of the end of last year, the accumulated reserves were recorded at 17.7712 trillion KRW.

The reduction in the deficit compared to the initial plan was largely due to increased revenue. Health insurance finances mainly consist of income from premiums paid by subscribers (workplace and regional) and expenditures such as benefit payments to medical institutions. Revenue increased by 403.1 billion KRW due to an increase in subscribers as dependents converted to regional subscribers and an increase in the monthly income of workplace subscribers. The monthly income-based premium is imposed on employees when their interest, dividends, or rental income exceed 34 million KRW annually, in addition to their salary.

Last year's expenditures amounted to 70.8886 trillion KRW, which was higher than initially planned but only exceeded expectations by 63.8 billion KRW. This was achieved by detailed monthly analysis and inspection of benefit payment fluctuations, as well as strengthening unnecessary expenditure management through detection and recovery from institutions violating establishment standards or making fraudulent claims.

Compared to 2018, revenue increased by 9.6% (5.9484 trillion KRW), and expenditures increased by 13.8% (8.5949 trillion KRW). The increase in expenditures was influenced by a combination of factors including population aging, increased treatment for chronic and severe diseases, expansion of new insurance benefits, and expanded health checkups for young people.

The NHIS acknowledged that the increase in expenditures due to the coverage enhancement policy was inevitable but stated that overall finances are being managed stably within the planned range. They plan to secure resources by utilizing part of the existing reserves of about 20 trillion KRW, increasing government support funds, and moderately raising insurance premium rates. The NHIS stated, "This year as well, we will manage finances based on the policy direction of the comprehensive health insurance plan and respond flexibly to environmental changes to operate finances efficiently," and pledged to maintain reserves above 10 trillion KRW going forward.

This content was produced with the assistance of AI translation services.