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Health Insurance Finance posted a surplus of 600.8 billion won (tentatively) in 2011

  • Date : 2012-01-10
  • Hit : 4436

Health Insurance Finance posted a surplus of 600.8 billion won (tentatively) in 2011

-switched into a surplus for the year through strong financial stability policy, leaving 1.560 trillion won in reserve -

Ministry of Health and Welfare (Minister Rim, Chae Min) informed that the health insurance

finance recorded a surplus of 600.8 billion won for the year (tentatively) as of end of 2011 and

1.560 trillion won in reserve was expected.

This is a result of the implementation of the financial stability policy that mobilized all possible

means. The financial risk at the end of 2010 (a deficit of 1.3 trillion won for the year) was

overcome and the finance was converted to a surplus for the year by the end of 2011.

Total annual revenue was 37 trillion and 977.4 billion won and total expenditure was 37 trillion

and 376.6 billion won (between Jan. and Dec. 2011). The medical aid spending increased by

7.4% and the insurance premium income grew by 15.0%.

The insurance premium income increased by 15.0% (4 trillion and 213.5 billion won) due to the

rise in insurance premium rate (5.9%), the impact of insurance premium adjustment (1 trillion

and 680.8 billion won), etc.

*The insurance premium income growth rate on five-year average (%): ('06˜'10)11.5 → ('07˜'11


It is primarily due to a rise in income itself reflecting economic recovery between 2009 and 2010

and the insurance premium increase rate and income rate have risen as much as those in 2007.

The medical aid expenditure increased just by 7.4% (2 trillion 505.5 billion won) compared to the

previous year thanks to strong financial stability measures such as reduction in drug price

(528.7 billion won) and a decline in medical aid increase rate due to economic slowdown, etc

despite the rise in medical insurance fee (1.64%).

* Medical aid increase rate on five-year average (%) : ('06˜'10)13.1 → ('07˜'11)11.0

* Medical aid increase rate (%): (06)17.7 → (07)14.3 → (08)7.9 → (09)13.8 → (10)11.7 → (11)7.4

* (Expenditure reduction 350.4 billion won) Designation of hypertension medicine as listed drug, treatment material price adjustment, imaging study cost adjustment, adjustment of the portion of large hospital drug cost to be paid by individual, et

* (Income secured 178.3 billion won) Insurance premium ceiling rate increase, exclusion of high value property owners from the employment health insurance benefit, insurance premium imposition enhancement, etc

Overall, the medical aid increase rate has declined and especially, the extent of decline is greater at large hospitals. It seems to have been caused by the expiration of five-year medical cost benefit for cancer patients, and the reduction of the medical insurance fee for imaging study such as CT and MRI, etc.

* Increase rate of the number of cancer patients registered for medical cost benefit (%) : (10)16.7 → (11)4.7

* Increase rate of the medical insurance aid for cancer patients subject to the medical cost benefit(%) : (10)19.5 → (11)3.9

The extent of decline in drug prices is relatively greater due to the realignment of the listed drugs and the crackdown on rebate practices, etc and because of this, the portion of the drug expenses in total medical expenses has decreased compared to the previous year

* The increase rate of drug cost out of total medical expenses (%) : (10)10.4 → (11)4.7

* The share of drug cost out of total medical cost (%) : (10)29 → (11)28.4

More detailed analysis will be conducted later.

A deficit of 177.2 billion won for the year of 2012* and, 1 trillion and 382.8 billion won in reserve

are expected for 2012.

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