South Korea

Since 1989, South Korea had had universal insurance coverage, and in 2000 it merged all medical insurance societies into the National Health Insurance Service (NHIS), which became a single-payer system in 2004. According to Bloomberg, the South Korean healthcare system is regarded as the fourth most cost-efficient in the world behind Hong Kong, Singapore, and Spain.

The NHIS, which is funded by individual contributions, government subsidies, and surcharges on tobacco, provides lower-cost coverage than most other developed countries, even as life expectancy is the 11th highest in the world.

Employees contribute about 6.1% of their income, while contributions from the self-employed are calculated based on their income level and property ownership. NHIS covers 40-70% of outpatient and 80% of inpatient costs and also reimburses the excess amount of out-of-pocket payments based on the patients’ income.

Even though over nearly all South Korean hospitals are private, all hospitals are not-for-profit by the law and they are paid on a fee-for-service basis by the NHIS. The government does not provide subsidies directly to hospitals.

The efficiencies of the system come with a cost since the system is operating on a low-contribution, low-benefit model. In South Korea, out-of-pocket costs to patients is a higher share of the cost than in most other OECD countries. While NHIS covers a breadth of diseases, it does not cover certain costs, such as MRI, ultrasound, and private rooms. Because of the basic level of benefits covered by NHIS, according to OECD, 37% of healthcare spending in South Korea is paid for directly by households.

  • Population:

    51.3 million(2016, World Bank)

  • GDP:

    $1,411 billion(2016, World Bank, USD)

  • Healthcare Spending:

    $104.4 billion(2016, Brocair estimate, USD)

  • Healthcare Spending as % of GDP:

    7.4%(2014, World Bank)

  • Annual Healthcare Spending Per Capita:

    $2,035(2016, Brocair estimate, USD)