On Monday, the dispute between Taipei City Hall and the National Health Insurance Bureau over the government subsidy for national health insurance premiums took a a surprising new twist: the Supreme Administrative Court ruled in favor of Taipei City Hall. The dispute has stemmed from City Hall's refusal to pay the bureau NT$10.8 billion (US$325 million) of overdue insurance premiums on the grounds that the city should not be obligated to subsidize the insurance premiums of those individuals whose registered residence is outside the city.
The bureau's position, on the other hand, is that City Hall is obliged to subsidize those who are insured through employers located within the boundaries of Taipei City, regardless of where their household registration is.
The ruling on Monday came as a surprise because both of the two previous rulings entered by lower courts had found in favor of the bureau. At the time, many were disappointed with City Hall's decision to appeal those rulings, believing that Mayor Ma Ying-jeou (
Of course, Monday's ruling is far from the end of the feud. The National Health Insurance Bureau wasted no time in responding and has already indicated that it will file a request for a constitutional interpretation with the Council of Grand Justices to overturn Monday's ruling.
All eyes are now focused on this legal dispute, because the final outcome of this case will determine not only whether Taipei City Hall will need to pay the NT$10.8 billion in premiums to the bureau, but also whether the bureau will need to collect a substantial chunk of the outstanding premiums from other local governments.
If Monday's ruling is upheld by the Council of Grand Justices, it will bring chaos to the national health insurance scheme, and could lead to a serious financial crisis for both the central government and the National Health Insurance Bureau. It is no secret that the central government has been running at a serious financial deficit over the past few years. If it has to shoulder an even greater percentage of the subsidy, surely there will be serious ramifications for other social and welfare programs sponsored and financed by the central government. If the central government cannot pay the bureau, the nearly bankrupt bureau's ability to continue operating will be jeopardized.
It is noteworthy that Kaohsiung City -- like Taipei City, a special municipality -- has opted to take an entirely different approach in dealing with its large sum of outstanding premiums. Kaohsiung City Hall has chosen to sell off some of the real estate and land it owns in order to pay off the debt, as well as negotiate a five-year payment plan with the bureau. This is obviously a much more responsible way of dealing with the issue at hand -- especially when compared with Taipei.
Ultimately, no matter whether the city hall or the central government subsidies the premiums, the taxpayers of Taiwan will have to pick up the tab. So instead of passing this financial hot potato on to the central government or dragging its feet in making the payment, Kaohsiung City Hall has decided to tackle the problem head on, and in a mature manner.
Back in Taipei, it is widely believed that Ma has his heart set on running for the presidency in the 2008 election. One cannot help but wonder how he will deal with financial crises or problems if he gets elected. Shoving problems into the central government's lap will no longer be an option, since that would be political suicide.
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