Legislature gets revised NHI package

WORSE THAN BEFORE?:Wang Jin-pyng will convene an inter-party negotiation today, but some activists said it was even more unfair than the ‘second-generation’ plan

By Shih Hsiu-chuan and Shelley Huang  /  Staff reporters

Fri, Dec 17, 2010 - Page 1

A revision of the National Health Insurance (NHI) reform plan presented by the Department of Health (DOH) yesterday drew mixed reviews, with supporters touting its benefits, while critics said it was even more unfair than the current system.

The revision came in the wake of the Executive Yuan and the Chinese Nationalist Party (KMT) caucus’ decision on Thursday last week to backpedal on their previous second-generation reform plan.

Under the new package proposed by Department of Health Minister Yaung Chih-liang (楊志良), an individual’s premium would be calculated based on interest income, share dividends, professional practice income and any cash awards that are four times more than a person’s salary.

The department’s initial proposal basically revolved around calculating premiums based on total household income, rather an individual’s salary as is done at present.

Legislators for the most part have agreed on the idea of calculating premiums based on household income, but political parties could not agree on how to define household income.

Some lawmakers also had issues with the initial proposal that would set premiums for housewives and the unemployed by assuming a “virtual” monthly income of NT$17,280, saying that the scheme did not reflect reality and could hurt the economically disadvantaged.

“With the inclusion of the four types of incomes, the premium rate imposed on an individual’s salary could be lower than the current rate of 5.17 percent,” Yaung said.

However, he said the exact rate, which is designed to maintain the insurance system’s financial balance for at least two years, has yet to be calculated.

Yaung said the revised proposal was expected to expand the premium base from the current NT$3.37 trillion (US$112.9 billion) annually to NT$4.37 trillion, less than the NT$5.56 trillion estimated in the earlier proposal, which had been dubbed “the second-generation” NHI system.

The latest revision suggests differentiating premium rates on regular salary and the newly incorporated four types of incomes, which Yaung said could be between 1 percent and 2 percent.

The revision was agreed to by KMT caucus representatives at a meeting that was presided over by Premier Wu Den-yih (吳敦義).

However, KMT Legislator Lin Tsang-min (林滄敏) has said that he would still suggest including income from rental properties into the calculations.

Legislative Speaker Wang Jin-pyng (王金平) will convene an inter-party negotiation today to seek the opinion of the Democratic Progressive Party caucus on the proposal.

Sun Yue (孫越), a celebrity who volunteers at the John Tung Foundation and who had openly endorsed the second-generation plan in the DOH’s advertisements, said he was in support of “all that is good for the public welfare.”

When asked about criticism of Yaung for proposing so many versions of the NHI bill, Sun said he was not in the position to answer certain questions about the NHI plan, but that “our hearts know right from wrong.”

“If [the new bill] passes, we as celebrities must take up the responsibility to help promote the system, because it is beneficial to the public’s health and welfare,” he said.


Civic groups such as the National Health Insurance Civil Surveillance Alliance, however, oppose the “new and improved” plan, labeling it a “fraud.”

Commenting on the proposal to impose a lower premium fee rate on non-salary income such as cash awards and bonuses, alliance spokesperson Eva Teng (滕西華) said: “This will give employers the incentive to transfer more employee compensation from regular salaries to bonuses in order to pay less premium.”

The result would be reduced workforce stability and a -decreased level of protection from labor insurance and pensions, she said.

Teng said the revision does nothing to address the unfair premium calculations for workers in certain occupations, such as high-income celebrities who, under the current system, only pay minimal premiums.

Son Yu-lian (孫友聯), secretary-general of the Taiwan Labour Front, also slammed the new proposal, saying it was not only worse than the original “second-generation” package, it was more unfair than the current system.


“It should be called the 0.5 generation health plan,” Son Yu-lian said.

He said that the new plan does not minimize administrative costs associated with tracking various sources of income and collecting premiums to keep the NHI fund sustainable, and that it was not worth fighting for a new plan that has limited benefits for the public.