Attention is focused on next year's national health insurance premium rate, which the government will decide this month. Health insurance expenditure is rising quickly as Korea enters a super-aged society and pushes medical reform, but the burden of raising premiums is also growing because of an economic slowdown, high inflation, and rising real estate prices.
According to the Ministry of Health and Welfare and the National Health Insurance Service on the 2nd, the government typically convenes the Health Insurance Policy Deliberation Committee (HIPDC) in August to finalize the premium rate for the following year. It decides the rate by reflecting the outcomes of fee schedule negotiations, economic growth, inflation, and the minimum wage, then incorporates it into the government budget proposal.
This year's health insurance premium rate is 7.19%. For employee subscribers, 7.19% of wages is shared equally by workers and employers. The premium rate was frozen for the first time ever for two consecutive years in 2024 and 2025, but it rose 1.48% from the previous year this year. The average monthly premium this year is 160,699 won for employee subscribers and 90,242 won for regional subscribers.
Health insurance finances are worsening over time. According to the Ministry of Data and Statistics (MODS), as of November last year, the population aged 65 and older was 10,723,000, accounting for 20.7% of the total population.
Medical use due to aging is also on the rise. According to the Health Insurance Statistics Yearbook published last year by the National Health Insurance Service and the Health Insurance Review & Assessment Service (HIRA), health insurance medical expenses in 2024 totaled 116.2375 trillion won.
Of that, medical expenses for seniors 65 and older were 52.1935 trillion won, accounting for 44.9% of the total. Compared with 2020, total medical expenses rose from 86.7139 trillion won to 116.2375 trillion won, and senior medical expenses rose from 37.6135 trillion won to 52.1935 trillion won.
Medical reform tasks such as shifting general hospital structures to advanced general hospitals, strengthening regional and essential care, and normalizing undervalued fee schedules are also factors increasing the fiscal burden.
In a re-estimate reflecting phases 1 and 2 of the medical reform execution plan, the National Assembly Budget Office projected that health insurance finances would shift to a current-account deficit this year and that roughly 30 trillion won in accumulated reserves would be depleted by 2029. Separately, a research team led by Kim Yoon-hee, a professor at Inha University College of Medicine, estimated that if the current system is maintained, the cumulative deficit of health insurance would reach 563 trillion won by 2042.
The issue is that opinions are split between the need to raise premiums for fiscal stability and the need to consider the public burden. Some analysts say it will not be easy to raise premiums when household burdens have increased amid recent stock market volatility, rising real estate prices, and high inflation.
The government is indeed grappling with the issue. The Ministry of Health and Welfare reported a plan to revamp the health insurance premium assessment system at a HIPDC subcommittee on the 23rd of last month, but, considering public sentiment and other factors, postponed bringing it to the HIPDC plenary session on the 29th of last month.
The reform plan includes lowering the deduction threshold for income-based monthly premiums applied to nonwage income (interest, dividends, rental, business income, etc.) of employee subscribers from 20 million won per year to 10 million won, raising the cap standard for ultra-high-income earners so the monthly cap increases from 4.59 million won to 6.12 million won, and updating the minimum premium standard (floor), which has been effectively frozen for 26 years.
Some also say the government's treasury support should be expanded. The National Health Insurance Act and the National Health Promotion Act stipulate that the government support 20% of the estimated premium revenue, but experts note that in many cases the actual support has fallen short of the statutory level.
Nam Eun-gyeong, head of the social affairs bureau at the Citizens' Coalition for Economic Justice, said, "It is desirable for the government to faithfully carry out the statutory treasury support and promote fiscal efficiency first, and then discuss whether to increase the public burden."
Given the usual schedule, the government is expected to finalize next year's health insurance premium rate this month after HIPDC deliberations.