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Health Care Laws Spur Debate, Rally

Posted November. 24, 2006 06:50,   


Some 10,000 people affiliated with the insurance business gathered at a playing field in front of the Gwacheon Government Complex at 1:30 p.m. on Thursday. Lee In-suk, 43, an insurance planner, sat on a sheet of newspapers in the corner of the field, holding a picket sign that said, “Oppose the revision of the private health insurance law.”

Lee said that the government is trying to reduce private health insurance coverage offered by private insurance companies, making it more difficult for insurance companies to sell their products, which in turn could damage consumers.

What change in the law prompted so many to gather and protest?

The mandatory national health insurance plan pays for treatment and medial equipment, which is designated as covered under the National Health Act. Usually, insurance covers diseases whose treatment or equipment use cost is not expensive.

The National Health Insurance Corporation pays some 60 percent of the total medical expenses; the rest is to be borne by patients themselves.

Private health insurance plans are designed to cover usage fees for expensive treatment facilities such as MRIs.

But recently, the Ministry of Health and Welfare and the ruling Uri Party decided to exclude the cost that patients have to bear from the coverage of private health insurance plans.

Three moot points-

The area of contention is how much private insurance plans should cover.

The health ministry argues that hospitals which treat patients with private health insurance tend to overtreat to get insurance benefits, adding to the national health insurance deficit.

Lee Jin-seok, a medical professor of Seoul National University, said in a seminar earlier this year that the medical cost of private health insurance subscribers turned out to be higher that that of those who aren’t.

Regarding this, insurance businesses including non-life insurers said that there is no evidence that private health insurance subscribers intentionally claim higher medical treatment; rather, they are more frequently seeking treatments, which leads to early detection of diseases, saving total treatment expenses.

In addition, the government points out that too many private health insurance products are hard to manage and that simplifying them in 10 categories could reduce damage to consumers.

On the other hand, insurance companies insist that the government’s idea could violate the consumers’ right to choose.

Lastly, which organization has to conduct oversight of private health insurance products is a focal point: to leave the power to the Financial Oversight Committee as it is now or to give it to the health ministry?

The impact on consumers-

When the coverage of private health insurance reduces, the benefits of the insurance subscribers will be cut substantially.

Take a look at the case of Park, 45, a salary earner, who has been hospitalized due to overwork. The hospital asked Park to pay a total of 205,834 won including a preliminary diagnosis fee, injection, examination, image screening and other fees.

Park, who subscribed to private insurance, didn’t have to put his hand in his pocket, but he will have to pay 86,910 won on his own when the coverage is reduced after next year.

If reduced coverage from private health insurances improves national health insurance financing, the National Health Insurance Corporation could cover more treatment costs than it does currently in the mid and long term, which means bigger benefits for consumers.

When the current system is kept, private health insurance subscribers can get affordable medical services continuously.

But, that means non-subscribers could be shortchanged due to the worsening financial situation of the national health insurance plan.

Jeong Gi-taek, a medical professor at Kyunghee University, said that a sudden institutional change gives disadvantages to current subscribers with less benefits, so rather than reducing private health insurance, it is necessary to connect public and private health insurance together to enhance medical efficiency.