Wed, Feb 09, 2005 - Page 2 News List

Targeting the rich will not fix health insurance crisis

FUNDING PROBLEMS A proposal that would make the nation's top salary earners pay higher insurance premiums is simply a band-aid solution, critics say

By Wang Hsiao-wen  /  STAFF REPORTER

With the public opposed to increased insurance premiums, the Bureau of National Health Insurance is now busy trying to find new revenue sources.

The latest proposal, made last Friday, is to raise the ceiling on insurance from NT$87,600 to NT$130,000 a change that would force the nation's white-collar workers, employers and company owners with monthly salaries greater than NT$87,600 to pay more.

Under the ceiling system, health insurance premiums are calculated as a percentage of a person's salary, up to the ceiling limit. Those with salaries above that level pay a percentage based on the ceiling amount.

In the face of its precarious financial situation, the Bureau of National Health Insurance is now setting its sights on the country's rich for temporary relief.

"We only have a NT$4.3 billion safety reserve left. As we overdraw the account by NT$1.4 billion every month, the safety reserve will be used up by March this year," said Lai Chin-hsiang (賴進祥) vice president of the Bureau of National Health Insurance.

With bankruptcy looming, the bureau says that raising the insurance ceiling to NT$130,000 is expected to bring in NT$1.4 billion for the health insurance program. Among the targeted 167,000 people, white-collar workers with salaries higher than NT$87,600 will have to pay an extra NT$50 to NT$579 per month. Employers or company owners in the highest salary rank of NT$130,000, will pay another NT$1,930 on top of their monthly NT$15,994 premium.

At first glance, it seems fair enough that the richer should pay more to sustain the universal health insurance plan and help the government shield the poor from illnesses. The Department of Health argued that the ceiling rise will only impact 2 percent of the 22 million insured, a privileged minority who tops the social hierarchy.

"Those with a monthly salary higher than NT$87,600 account only for about 2 percent of the total insured. They are the minority who sit on the top of the income pyramid. To make the richer pay more is actually in accord with the spirit of national health insurance -- the capable to help the less capable," the department stated in a news release last Saturday.

To the public's relief, most people will not be charged more.

But calculating insurance premiums on the basis of individual income levels does not necessarily mean moving closer to social justice, experts said.

The reason is simple enough.

In a country where year-end bonuses, performance prizes, property rent, stock income and a host of other sources of income are not included in reported salary levels, salaries are hardly an index of one's wealth.

"If you take salary as an indicator to gauge a person's wealth, then you miss the big picture. You could say that a tycoon like Wang Yung-ching (王永慶) is not that rich. In Taiwan, the richer a person is, the more likely it is that his salary accounts for a small part of his total earnings," said Yang Chih-liang (楊志良), former deputy director-general of the Department of Health and a professor at the Taichung Healthcare and Management University.

To calculate the premium on individual income like payroll taxes, Yang said, is like tearing down a house, just to rebuild it on another piece of shaky ground.

"How can you expect a structure built on an unfair foundation to be fair?" he said.

For white-collars who worked their way up from the bottom and employers who slogged long hours to get where they are now, the ceiling rise is a punishment to appease the public.

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