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Universal Health Coverage Study Series No. 33

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Universal Health Coverage Study Series No. 33 UNIVERSAL HEALTH COVERAGE STUDY SERIES NO. 33 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Please cite this paper as: Kwon. S. 2018. “Advancing Universal Health Coverage: What Developing Countries Can Learn from the Korean Experience?” Universal Health Care Coverage Series No. 33, World Bank Group, Washington, DC. Public Disclosure Authorized 2 UNIVERSAL HEALTH COVERAGE STUDY SERIES No. 33 Advancing Universal Health Coverage: What Developing Countries Can Learn from the Korean Experience? Soonman Kwon The World Bank, Washington, DC, 2018 3 4 TABLE OF CONTENTS Contents About the Author ............................................................................................................................ 7 Executive Summary ...................................................................................................................... 10 1. Political and Socioeconomic Context ................................................................................ 11 2. Expanding Population Coverage ........................................................................................ 13 3. Financial Resources and Pooling ....................................................................................... 17 4. Strategic Purchasing........................................................................................................... 23 5. Supply of Health Care ........................................................................................................ 28 6. Governance and Accountability ......................................................................................... 33 7. Future Challenges .............................................................................................................. 35 Notes.......................................................................................................................................... 38 Tables Table 1. Economic Indicators ....................................................................................................... 11 Table 2. Demographic Indicators .................................................................................................. 12 Table 3. Economic and Health Indicators in Korea, 1977–2014 .................................................. 12 Table 4. Number of the Insured for Three Types of Health Insurance Funds (thousands of people) .......................................................................................................................................... 16 Table 5. Trend in National Health Expenditure (%), 1990–2013 ................................................. 17 Table 6. Financing of National Health Insurance, 2001–13 ........................................................ 18 Table 7. Speed of Aging in Selected countries (Number of years for the .................................... 32 Figures Figure 1. Total Health Expenditure, Korea ................................................................................... 19 Figure 2. Total Health Expenditure as a Percentage of GDP in OECD Countries, 2012 ............. 20 Figure 3. Percentage of Public Expenditure in Total Health Expenditure in OECD Countries, 2012............................................................................................................................................... 21 Figure 4. Pharmaceutical Expenditure as a Percentage of Current Health Expenditure, OECD Countries, 2013 ............................................................................................................................. 30 5 Abbreviations C-section Caesarean section CRVS Civil Registration and Vital Statistics DRG Diagnosis-related Group GDP Gross Domestic Product HIPDC Health Insurance Policy Deliberation Committee HIRA Health Insurance Review and Assessment ICT Information and Communications Technology KPIS Korea Pharmaceutical Information System LTC Long-term Care LTCI Long-term Care Insurance MoHW Ministry of Health and Welfare NHI National Health Insurance NHIS National Health Insurance Service OECD Organisation for Economic Co-operation and Development OOP Out-of-Pocket P4P Pay for Performance TFR Total Fertility Rate VHI Voluntary Health Insurance 6 Preface to the second round of the Universal Health Coverage Study Series All over the world countries are implementing pro-poor reforms to advance universal health coverage. The widespread trend to expand coverage resulted in the inclusion of the “achieving universal health coverage by 2030” target in the Sustainable Development Agenda. Progress is monitored through indicators measuring gains in financial risk protection and in access to quality essential health-care services. The Universal Health Coverage (UHC) Studies Series was launched in 2013 with the objective of sharing knowledge regarding pro-poor reforms advancing UHC in developing countries. The series is aimed at policy-makers and UHC reform implementers in low- and middle-income countries. The Series recognizes that there are many policy paths to achieve UHC and therefore does not endorse a specific path or model. The Series consists of country case studies and technical papers. The case studies employ a standardized approach aimed at understanding the tools –policies, instruments and institutions- used to expand health coverage across three dimensions: population, health services and affordability. The approach relies on a protocol involving around 300 questions structured to provide a detailed understanding of how countries are implementing UHC reforms in the following areas: • Progressive Universalism: expanding population coverage while ensuring that the poor and vulnerable are not left behind; • Strategic Purchasing: expanding the statutory benefits package and developing incentives for its effective delivery by health-care providers; • Raising revenues to finance health care in fiscally sustainable ways; • Improving the availability and quality of health-care providers; and, • Strengthening accountability to ensure the fulfillment of promises made between citizens, governments and health institutions. By 2017, the Series had published 24 country case studies and conducted a systematic literature review on the impact of UHC reforms. In 2018 the Series will publish an additional15 case studies, A book analyzing and comparing the initial 24 country case studies is also available: Going Universal: How 24 Developing Countries are Implementing UHC Reforms from the Bottom Up. Links to the Series and the book are included below. Daniel Cotlear, D. Phil. Manager and Editor Universal Health Coverage Study Series Links: http://www.worldbank.org/en/topic/health/publication/universal-health-coverage-study-series http://www.worldbank.org/en/topic/universalhealthcoverage/publication/going-universal-how- 24-countries-are-implementing-universal-health-coverage-reforms-from-bottom-up 7 Acknowledgements Very helpful comments by Daniel Cotlear and Sanggon Na and capable research assistance by Eunkyoung Kim are gratefully acknowledged. 8 About the Author Soonman KWON is Professor and Former Dean of the School of Public Health, Seoul National University, South Korea and held visiting positions at Harvard School of Public Health, London School of Economics, University of Toronto, and Peking University. He was the Chief of Health Sector Group in the Asian Development Bank (ADB). He has been a member of advisory committees of WHO Alliance for Health Policy and Systems Research, GAVI (Global Alliance for Vaccines and Immunization), and WHO Centre for Health Development. He is the president of the Korean Health Economic Association, and was the president of the Korean Association of Schools of Public Health in 2013-14 and the Korean Gerontological Society in 2015-16. He is currently the Associate Editor of Health Policy (Elsevier) and was the editor of the Korean Journal of Public Health in 2007-09 and Korean Journal of Health Economics in 2014-15. He has been on the editorial boards of Social Science and Medicine, Health Economics Policy and Law, BMC Health Services Research, and Ageing Research Reviews. With WHO, World Bank, GIZ, and ADB, he has worked on the health system and financing in Algeria, Bhutan, Cambodia, China, Egypt, Ethiopia, Fiji, Ghana, India, Indonesia, Kazakhstan, Kenya, Lao PDR, Malaysia, Maldives, Mongolia, Myanmar, Nepal, Pakistan, Philippines, Uganda, and Vietnam. He holds PhD in health economics from the Wharton School of the University of Pennsylvania (1993) and taught at the University of Southern California School of Public Policy. 9 Executive Summary The Republic of Korea achieved universal health coverage in 1989, 12 years after the introduction of mandatory health insurance for employees in large corporations. Political legitimization of the authoritarian regime and rapid economic growth contributed to the rapid extension of health coverage. The health insurance contribution is based on the wage of formal sector workers and, for the self-employed, on assessed income, including assets. Most health care providers are private. In 2000, all insurance funds were merged into a single insurer, which improved the efficiency of risk pooling and equity in contribution payments. The single insurer system also provided the national health insurance system with the opportunity to strengthen its purchasing function. This included review and assessment of service provision and claims, as well as the management of enrollees and service providers, based on an effective
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