The government has decided to freeze the health insurance premium rate for next year at the current 7.19%. The Ministry of Health and Welfare held the 15th Health Insurance Policy Review Committee on September 8, where it approved the freeze for the 2027 premium rate and the 'Phase 1 Innovation Plan for Health Insurance Coverage.'
The premium rate for workplace subscribers will remain unchanged, and the amount per point for regional subscribers is also fixed at 211.5 won. The government plans to invest up to 800 billion won annually to expand coverage for 1.97 million people with severe and rare diseases without raising the premium rate. This initiative aims to alleviate household burdens amid high inflation and economic slowdown while strengthening the medical safety net for vulnerable groups.
However, concerns arise regarding the policy's transparency and underlying motives. The Ministry is banking on increased tax and insurance revenue from a recovery in the semiconductor market and using the approximately 30 trillion won in reserves as a buffer against immediate expenditures. While reserves can temporarily cover spending, they cannot replace sustainable revenue sources. Announcing a significant increase in spending while closing off revenue streams is seen as short-sighted populism.
There are also suspicions of political collusion to avoid a significant premium increase amid declining approval ratings for the ruling party and President Lee Jae-myung, suggesting that long-term social insurance policies are being treated as political tools rather than serious reforms.
The premium rate was frozen at 7.09% in 2024 and 2025, then increased by 1.48% to 7.19% this year. Now, just a year later, it is being frozen again. The surplus and accumulated reserves from previous years are misleading, resulting from a temporary decrease in medical usage during the COVID-19 pandemic, not a sign of a healthy insurance fund.
With the rapid increase in medical costs for the elderly due to an aging population, spending pressures are mounting. Long-term projections from the National Assembly Budget Office warn that without structural reforms, the fund will face deficits and depletion of reserves. The ministry's approach of increasing spending while neglecting to expand revenue sources is a dereliction of duty and shifts the burden to future generations.
Raising the premium rate is not the only solution. Before tapping into citizens' pockets, the government must first address financial leaks and innovate spending structures. It should tackle excessive non-covered medical services linked to private insurance and effectively redesign the co-payment system for unnecessary outpatient visits.
Completing the reform of the income-based contribution system and legalizing the long-dormant government support ratio (20%) will enhance predictability in financial inputs. If the government becomes preoccupied with political gains and misses the golden opportunity for structural reform, the consequences of a financial collapse in health insurance will ultimately fall on the citizens.
* This article has been translated by AI.
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