Taiwan to reform health insurance scheme
By Jianggan Li
The Legislative Yuan, Taiwan’s parliament, has passed a controversial amendment to the National Health Insurance Act (NHI).
Compared to the universal healthcare coverage provide by the National Health Service in the UK, the Taiwan National Health Insurance scheme offers a lower premium with more adequate healthcare resources. Long waitlists are rare occurrences in Taiwan.
Since NHI’s implementation in 1995, more than 97 per cent of Taiwan’s 2300 million residents have been covered. Paul Krugman, Laureate of Nobel Prize for Economics in 2008, has called Taiwan’s system the best in the world. In an earlier talk with FutureGov, Prof K C Lun, the funding president of Asia Medication Informatics Association, commended NHI’s card based insurance system as the most successful IC-card use in healthcare in the globe. Nevertheless, after 15 years in practice, the system has accumulated a debt sum of more than NT$ 130 billion (US$ 4.2 billion), risking bankruptcy is no reform is undertaken.
As Taiwan does not have a system of family doctors to do gate-keeping for general hospitals, major health institutions are overwhelmed while some of the local medical resources are underused.
And abuse of the system is not uncommon. In one of the extreme cases, a patient was reported to have visited hospitals more than 400 times within a year, causing huge burden to hospital workload and finances of the insurance system. It is also estimated inflated medication prices cost the system more than NT$10 billion (US$ ) each year.
NHI is also one of the main reasons that most hospitals in Taiwan choose to develop their own Hospital Information Systems (HIS). Hayashi Meiken, CIO of Taiwan Adventist Hospital, told FutureGov that the hospital has to be very fast in responding to change requests from the Bureau of National Health Insurance. Sometimes a few requests would come on the same day and “relying on vendors simply can’t guarantee our compliance with the requirements in time‘, Hayashi said. The approved amendment will calculate a person’s premium based on his or her salary, as under the current system. In the meantime, the premium rate will be lowered from 5.17 per cent to 4.91 per cent of the regular salary.
However, individuals with extra income (from investment, rent or bonuses) equalling or more than four times their monthly salary would be required to pay a “supplementary premium” – two per cent of their extra income.
The government estimates that the “supplementary premium” would increase NHI revenue by NT$20.8 billion (US$713.9 million) annually.
Eighty-three per cent of the residents will see their premium lowered under the new schedule, while the remaining 17 per cent will have to pay extra to the system.
The Department of Health originally proposed to reform the current NHI premium scheme by using an individual’s household income as the basis for premium calculation. The proposal failed to be passed in the Legislative Yuan in early December. The approved amendment will also impose restrictions on foreign participating in the insurance plan. Only holders of residency permits who are employed or have stayed in Taiwan for more than six months would be covered. The original act gives insurance coverage to foreigners who had lived in Taiwan for a minimum of four months as well as full-time foreign workers hired by schools.
Opposition Democratic Progressive Party legislators walked out in protest after their proposed version of the amendments had been voted down.
Department of Health Minister Yaung Chih-liang has offered to resign following the passing of the bill, expressing regret that he was unable to obtain 100 per cent support for the bill.
Yaung had previously said that he would resign if the legislature failed to pass the reform bill by the current legislative session. Tendering his resignation to the Premier nonetheless, he quoted his ‘personal incompetent’ as a main reason for the ‘bumpy road to reforming the national health insurance system.”
Yaung was also apologetic, -saying his “personal incompetence had resulted in the bumpy road to reforming the national health insurance system.”
Premier Wu Den-yih has not approved Yaung’s resignation at press time, and was quoted in a government statement saying that Yaung should stay on course to oversee the implementation of the amended insurance system.
The implementation timeline will be determined by the Executive Yuan, led by Premier Wu.
