The main aspects of medical insurance of south korea in the modern period

The article examines the questions of medical insurance of South Korea. Particular attention is paid to the main criteria for insurance and global competitiveness index.

South Korea is one of the ten countries of international medical tourism. Since hospitals and clinics are fully equipped with advanced technologies, as well as awarded quality certificates, Korea is undoubtedly a leader in the field of medical tourism: modern modern medical equipment and extensive experience. Now South Korea is one of the largest economies in the world. It is noteworthy that Korea manages to combine advanced technology and its culture, preserving traditions and customs. The country honors history, and at the same time the country is moving forward, developing in step with the times and is on a par with the advanced Western powers.

Also, South Korea is one of the fastest growing countries in the world, and the quality of life of Koreans as a whole is increasingly improving, including through the level of health care.

South Korea's health care system consists of three areas: the National Health Insurance Program, The Medical Aid Program and Long-term Care Program. All people in South Korea are eligible for insurance under the National health insurance program. Until 1977, Korea had only voluntary health insurance. In addition, in 1977, President Chung- Hee passed a law that provided for compulsory health insurance. Thus, Korea has gradually achieved universal health coverage insurance by 2000. The NHI program of Korea covers the whole population as a compulsory social insurance system. Its main sources of finance are contributions from the insured and government subsidy. The benefit package consists of benefits in-kind and benefits in-cash on the whole. When people get health care services through the NHI program, co-payments are applied according to types of health care institutions. The application of the Program to Foreigners working in Korea is governed by the same laws that govern Korean workers: there is no difference in the eyes of the Law between Koreans and Foreigners on the issue of the National Health Insurance Program [1].

The national health insurance scheme covers 97 per cent of the total population. Insured persons are divided into 2 groups: employees and self-employed [2]. The remaining 3 % of the total population is covered by the health care Program. This program, designed for patients who cannot afford health care, covers patients with rare, intractable and chronic diseases, as well as children under the age of 18. The health care program is financed by the Central and local authorities.

Another feature of Korea's health care system is that all health facilities (even private) are considered non-profit. This means that income derived from the provision of medical services is not taxed. This is a very high motivation in providing affordable and quality medical services. All medical facilities are exempt from taxes. In this case, theprofit can only be used for reinvestments. Therefore, medical institutions spend all their profits on equipping clinics with modern expensive equipment for laboratory research and scientific development, which are incredibly expensive. Even a small clinic can be equipped with, for example, surgical robots, as there are opportunities for this. Accordingly, the state determines the prices for all types of medical services. In addition, Koreans are very ambitious and have a highly developed competitive spirit, which creates a favorable competitive environment. Therefore, South Korean doctors actively monitor all events and quickly introduce new technologies in health care.

However, at the beginning of the introduction of health insurance Korea faced some difficulties. There has been a constant political and institutional struggle to integrate health insurance societies into the national system and to decentralize them. Those who were in favor of decentralization argued that the merger would result in the transfer of insurance premiums from industrial employers and workers to the self-employed. Nevertheless, those who were for centralization emphasized the solidarity of all workers and social classes.

If you are a documented foreign resident (not a tourist or undocumented worked) you can enroll in the Korean National Health Insurance plan. A law passed a few years ago requires that all foreign workers be enrolled in the NHI system, although there are some exceptions. If the company is providing international medical coverage, it does not need to re-insure it's foreign staff. Some local companies are also exempted because of their size, etc. However, anyone wishing to enroll in the NIHS system, can do so - the cost is much lower than medical insurance plans in many Western countries. The rates are adjusted each spring to reflect any changes in salary, bonuses, etc. since they are based on a percentage of earnings. This adjustment will be reflected in the April contribution. The April increase (should there be one) is not part of the annual contribution rise; it is a reflection of a rise in the contributor's income. The increase also occurs if the employer declared a lower salary over the past year than what was actually paid and is based on each employee's year-end tax settlement (end March). Should the salary be lower than what was declared, the contributor's rate will decrease in April.

Korea implements a health insurance system whereby a person pays a certain amount of a monthly fee in accordance with his / her income and assets. Becoming a subject of health insurance, you can use medical services for childbirth or illness at low rates, and receive regular medical check-ups. All citizens of the Republic of Korea, with the exception of those receiving a medical pension, must be insured.

Insurance subjects are divided into insured workers and insured by place of residence. All persons working in firms, employees of state enterprises and educational institutions are subject to medical insurance. Since the main source of income in the family comes from the person employed in the industry, following the conditions stipulated in the current legislation on health insurance, family members claiming it can be entered into his insurance policy as dependent subjects. The rest belong to the category of insurance of subjects at the place of residence. For subscribers working in companies, the company pays 50% of the health insurance premium (only applies to salary), and the remaining 50% is paid on their own. If there is a separate source of income in excess of 72 million won, 50% of the insurance rate is paid on its own [2].

The National Medical Insurance Corporation pays part of the medical expenses of the insured, so that medical expenses at a hospital, clinic or clinic of Oriental medicine are much less than for uninsured people. The rest of the expenses are paid by the policyholder himself. In addition, it is provided with benefits during a medical examination. The type of physical examination varies depending on age and is usually held once every two years.

Thus, the national health insurance program in Korea has three sources of funding: contributions, government subsidies and excise taxes on tobacco products. Employees contribute 5 % of their salary. The employee and the employer pay 50% of this equal amounts. The government provides 14 % of the annual planned program budget. Moreover, the additional fee for tobacco products is 6 % of the total program budget. It should be noted that compulsory insurance covers from 50 to 80 % of the cost of treatment, the rest of the amount is paid by the patient. At the present stage of economic development, the competitiveness of the country is estimated according to the Global competitiveness index (GCI). The GCI is a study conducted by the world economic forum (hereinafter-WEF) that assesses countries in terms of economic competitiveness. It is well known that countries with high national competitiveness, as a rule, they provide a higher level of well-being of their citizens and, accordingly, social security. This indicator helps countries to make economic policy decisions, develop strategies for further economic development, and improve the competitiveness of the national economy[3].

In the ranking of the GIC for 2016-2017, South Korea took 26th place (table 1).

In addition, one of the main points of ensuring a high quality of life in South Korea are scheduled medical examinations. For example, the first health insurance Law, which came into force in 1963, called on all companies to provide health insurance programs. As a result, every able-bodied citizen is legally obliged to undergo a scheduled medical examination once a year. It includes general tests, colonoscopy and gastroscopy, ECG, ultrasound of all organs, gynecologist, ophthalmologist, etc. Experts will determine the body mass index and give recommendations for a healthy diet and lifestyle. In General, everything is the same as in Kazakhstan. The difference is as follows. Patients in South Korea strictly adhere to the requirements of the law. Experts say that these annual studies can identify many diseases at the earliest stages and successfully cope with them. South Korea ranks first in the treatment of cancer, but only because patients are diagnosed and treated on time, in the early stages. Undoubtedly, Korea surpasses Kazakhstan in many indicators of economic development, including the development of health care. However, it should be borne in mind that in Korea, compulsory health insurance with universal insurance has existed for 40 years, and the law on health insurance was adopted more than 50 years ago. Kazakhstan is currently introducing compulsory social insurance. In addition, the government wants to reach universal coverage. Of course, risks are not excluded, such as moral hazard, both in the patient and in health care providers, which is so common in insurance models in many countries. There are also risks of a shortfall in financial income or hiding true income. However, as Korea's experience shows, the main thing is to respond to changes in the system in a timely manner, monitor the movement of financial revenues and regularly monitor the provision of medical services. Moreover, in the near future, Kazakhstan will achieve the same high rates in health care as in Korea.

List of used materials:

1. Hee-Chung Kang. Korean Healthcare Quality Report ?- Developing National Healthcare Quality Report, Korea Institute for Health and Social Affairs, 2015.
2. Soonman Kwon, Tae-jin Lee, Chang-yup Kim. Republic of Korea: Health System Review // Health Systems in Transition, Vol. 5 No. 4, 2015; World Health Organization, 2015 (on behalf of the Asia Pacific Observatory on Health Systems and Policies).
3. Sang-Hyop Lee, Andrew Manson, Kwang Eon Sul. Social Policy at a Crossroads: Trends in Advanced Countries and Implications for Korea. Korea Development Institute, 2018.