Five years have passed since legal amendments were adopted that gave rise to what is known as the second-generation National Health Insurance (NHI) program. At the time, a decade of research and discussion by about 100 academics had produced a proposal to adopt a system of collecting insurance contributions based on total household income.
However, at that key moment in the legislative process, the Ministry of Finance, along with legislators who focus on financial matters, conspired to overturn this proposal. Instead, a twin-track system was adopted that incorporates supplementary premiums — an arrangement that fleeces premium payers twice over and weighs the scales even more unevenly than had previously been the case.
During the two years since this system was implemented, there have been widespread protests over unfairness caused by supplementary premiums, while people in the healthcare profession have been sounding the alarm over the critical shortage of NHI contributions. Nonetheless, the Ministry of Health and Welfare has announced that we will have to wait three years before it even proposes a plan for new amendments to the NHI system.
Meanwhile, senior officials promise that NHI contributions will not go up before 2017. However, the Liberty Times recently reported that Taiwan’s twin phenomena of smaller families and an aging population mean that the NHI’s revenue will not be able to cover its expenditure in three years’ time. This report is backed up by the latest research which casts doubt on the claim that supplementary premiums were a big step forward, and it highlights the urgency of immediately amending the law to collect contributions based on total household income.
Research published in the latest issue of the Taiwan Journal of Public Health by academics Liang Ching-yang (梁景洋) and Cheng Ching-hsia (鄭清霞) shows that supplementary NHI premiums are a measure that can only alleviate the program’s financial troubles in the short term, and cannot resolve the imbalance in NHI revenue and expenditure in the long term. As people figure out ways to avoid paying NHI contributions, the prospects for future revenue are not good. Consequently, amendments to the law cannot be delayed and pressure to make the necessary amendments will make itself felt before very long.
Harvard University professor William Hsiao (蕭慶倫), a leading consultant for the nation’s health insurance system, said at a recent symposium marking the 20th anniversary of Taiwan’s NHI that the problem of insufficient revenue for the system arises from the fact that its funding base is too narrow, concentrated as it is on the salary-earning class. The founding fathers of the NHI, such as former department of health minister Yaung Chih-liang (楊志良) and public health professor Wu Kai-hsun (吳凱勳), are also highly critical of the supplementary premium system. They say they would like to see the Ministry of Health and Welfare get on with amending the law this year, while the NHI’s finances are relatively stable.
However, the government is still putting off making the necessary changes, saying that the issue can be discussed in three years’ time. Futhermore, no legislators have proposed amending the law to bring in a system of insurance contributions based on total household income.
Another worrying thing is that the ministry is seeking to do the same thing again by copying the supplementary premium system in its plans for long-term care insurance. This is likely to cause even more discontent, impacting people’s willingness to pay contributions and obstructing implementation of the system.
The Taiwan Healthcare Reform Foundation believes that the greatest challenges faced by the NHI are stagnant wages and the falling number of employed people who are able to pay NHI contributions. However, this crisis is also a great opportunity for the government to start levying contributions based on total household income. Such a change would reverse the unjust situation in which salary earners bear the greater part of the burden of the NHI’s finances.
Past experience shows that each round of amendments to the National Health Insurance Act (全民健康保險法) takes five to 10 years to get off the ground. The government knows perfectly well where the problem lies, and a draft amendment has been available for a long time.
How can we allow the government to go on delaying for another three years, while continuing to exploit families who have to get by on stagnant wages and have no way to avoid paying contributions?
We would like to see the executive and legislative arms of government get straight down to the job of amending the law and reorienting the system to levy NHI contributions based on total household income. It would be foolish to delay such a move until three years from now, while the NHI slips deeper and deeper into a financial coma. Only if prompt action is taken will the NHI still be around 20 years from now.
Liu Mei-chun is chairwoman of the Taiwan Healthcare Reform Foundation and Shen Pei-han is a researcher at the foundation.
Translated by Julian Clegg
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