Spectre of ageing population worries economists

Having achieved so much in extending health-care coverage over the past 30 years, the Republic of Korea is faced with ballooning costs from an ageing population. Lee Ji-yoon reports.

Eighty-one-year-old Lee Yang-soon remembers how things were before the Korean War (1950–53). “Many women died giving birth,” she says, adding that, even after the war, health services were limited. Most pregnant women did not receive prenatal checkups and gave birth at home. “Even when babies were born healthy, some of them died without the exact cause of death being verified,” Lee says. Other health-care services were also poor then. “I was suffering from a skin disease. The medical costs were too expensive and the drug didn’t work well. I used to apply a Japanese ointment that my friend who travelled to Japan frequently bought for me.”

It took another 20 years for the situation to begin to change. In 1976, the government introduced the National Health Insurance (NHI) scheme, obliging companies employing more than 500 people to offer the scheme. In the ensuing decade, this obligation was extended to smaller companies, then government and private school employees and finally the self-employed, who were brought under the umbrella of mandatory national health insurance in 1989. Running parallel to the NHI, the Medical Aid Program, a government-funded public assistance scheme, was established in 1977 to provide free medical insurance coverage to eligible low-income individuals, about 3% of the population in 2008.

WHO/Lee Ji-yoon Three generations (from left): Lee In-sook, aged 52, her mother-in-law, Lee Yang-soon, 81, and daughter Paik Soo-ryun, 28.

In the past 30 years, average life expectancy in the Republic of Korea increased from 64.8 to 78.5 years – close to the average among member countries of the Organisation for Economic Co-operation and Development (OECD). Infant mortality also improved, from 27 deaths per 1000 live births in 1977 to 5.3 per 1000 in 2007, better than the OECD average of 6.1. “Several factors may have contributed to the overall health improvement of people in the Republic of Korea, but the implementation of the health insurance system seems to be one of the most decisive factors,” says Seo Nam-kyu, a research fellow at the Institute for National Health Insurance, an affiliate of the National Health Insurance Corporation./.../