Health Care Insurance System and Non profit and Cooperation Sector in Korea
Hideo Ishizuka
2003.11.20
1. Introduction
Korea has approximately forty-seven million populations and its national healthcare insurance system has covered almost of the nation in the year of 2003. A ratethat occupied for GDP of medical treatment expense is 5.4 percents, which is classified
to a low position country group (1999) among the developed and developing countries.
National health care expense of Korea has reached approximately 3.7 billion yen (yearof 2000), showing a fourth in comparison with that of Japan. Korea has establishedthe national health care system in 1989, after thirteen years of full-scalepreliminary period and with thirty years interval its original kick off its
preparation of the system from 1976. Korea’s national health care insurance system
has been promoted based on its rapid social economic development during decades.
National health care system of Korea started formally in 1963 with enacting of“Health care insurance law”. However, It was a start that the system could not avoid
the negative principle of “low contribution, low service” due to the social andeconomic lower development level at that time.
At this moment, the ninety percents of a medical and health care organizations
or providers are belonged to a private sector. Similarly in Japan, most of themare profit seeking character substantially and there is no legislation for non profit
organization. They provide medical services in kind for patients. A ratio of pay
for service by patients or users is relatively high. Before changing the pharmacy
system in 2001, medical and health care providers supplied medicines and drugs inaccordance with the rule of pay for service. Until 2001, all pharmacy which isbelonged to a private sector wholly, and a pharmacist also supplied medicine forpatients separately from the manipulation of doctors.
Health care policy of Korea government was fundamentally to promote or depend on
a private sector; adapting simultaneously government itself took a health care policy
to restrict a part of a public medical treatment
At this moment, medical institutions as legal entities defined by the national
health insurance are complied such as follows:
State medical institutions are 12, Provincial medical institutions 9, Municipal
medical institutions (in county, city and town) 3,600, Local pro-administrative
medical institutions 35, special medical legal entities 32, summing 3,698 in total.
According to the classification, they are also classified such as;
General hospital (55), hospital (16), special hospital (17), Public health centerand clinics (3,447) which engage in primary care.
At the beginning of the health care insurance system, occupational health careinsurance unions were main providers which adopted voluntary membership.
Accompanied with reform of Health care insurance act in 1976, provider’s two pillars
of providers were established, namely, as occupational insurance funds on one hand,those based on area on the other hand. Consequently, it became three different kindsof insurance funds. Firstly, occupational Insurance associations (funds) affiliatedby big and medium companies. Secondly, "public servant health insurance funds”

1including those of military servants and of teachers, thirdly, "regional healthinsurance association" affiliated by self employees. They were organized in turnand gradually their cover rate expanded.
Joining rate of individuals in Health insurance system was only 8.6 percents in
1977. Public service personnel after that joined it; moreover it joined it of
employees who work the enterprise having more than sixteen people. Joining rate
became 44.1 percent in 1985. By enforcement of universal principle target system
in 1989, regional self employees also could enter the system.
A cover rate became 97.6 percents in 1990. It was after the settlement of the single
government-owned health insurance corporation system in 1998 by integrating three
insurance funds.
Although a patient could freely choose a provider (medical doctor or medical
institutions), there doesn't exist primary care or gate-keeper system. There wasno clear distinction between hospital and clinic based on a scale of bed number,so a patient could go any preferable one. A patient was able to receive medicine
through either a pharmacy or a medical doctor before the medical system reform in
2000.
Public health care centers which established 1981 in the local area based on theadministrative district (minimum five hundred households) has a character of the
primary care responsible entities. One of the trial to arrange the obligatory medical
doctor who was exempted the military service to implement in the administrative
district.
Oriental medical care also is traditionally popular and many patients usually goboth of Western medical Orient medical institutions. However, oriental medical
service isn't included into health care insurance system.
It is said to that a fundamental character of the starting point of health careinsurance system of Korea is "low premium burden, low benefit". “National healthcare insurance Act” enacted in 1999 had two main directions; first, it aimed tointegrate the functions of three funds into one insurer fund; secondly, to split
the function of medical treatment and medicine or pharmacy provide service.
Figure. Health Insurance System before a reformation

2

MoneyServiceCompany,
Employer

Occupational

National Health

Union

CentralGovernment

Insurance Union

NHI
Corporation

Medical carefor the poor

Pharmacy

Clinics

Public medical center

NationPatients

Hospitals

2. Historic characteristic of Health insurance system of Korea
In comparison with Japan, with tame lag for an around-20-year, Korea has promoted
rapidly national health insurance system, in accompany with the rapid change of thecivil society from military autocratic governance to democratization.
Table.2. chronology
1962. Start of Five year economic plan.
1977. Start of Health Insurance Act (Funds affiliated over 500 employee companies)
1979. Begin to enter public servants and teachers in a fund.
1988. Begin to enter self employees in a fund.
1989. Begin to enter farmers and fishers in the fund (attain of full coverage or
Universality)
1990. Implement of National Health Insurance Act (integration into one insurancefund).
1997. Modification of National Health Insurance Act (establishing Health Insurance
Corporation).
1999. Modification of National Health Insurance Act (preparing reorganization plan.
partial integration plan of funds)
2000.
Integration of the management of National Health Insurance system(establishing Agency of evaluation of health care insurance or HIRA. Act for divisionof receipt and service of pharmacy: so called Partial integrate method.
2002. Start of complete integrating method.

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In the argument of Health insurance system of Korea, one specialist divides the periodof the process of establishing National Health Insurance system into threecontroversy eras; namely, the era of first discussion on integration of insurers(1980-1985); the era of second discussion(1986’1989); the era of third
discussion(1993-1999. We see the each characteristics based on these three eras.
(1)
The first controversy (1980-1985)
Under the military regime by Chon Dong Hung insurgent of Kwangju city turmoil
happened in 1980. In tat time, the argument on the health care system was how toform regional health insurance system. In this case, most important financial problem
was how to make pay contribution from local residents whose income relatively lower
than employees. On the other hand, there was proposal of integration of the public
servants and teachers fund and the regional fund. This aimed at an economy of scale
and to cover both local agricultural village and fishing village residents.
Insurance fund tried pilot management of local health care insurance program in theseareas.
(2) The second controversy (1986-1989)"Citizen welfare increasing general plan", was announced in 1986, and a proposalof an enforcement of local agricultural and fishing village health insurance being
done 1n 1988 and of an urban regional health insurance in1988. Though Nou Te Uhbecame President in 1988, an election of local municipalities wasn't achieved andonly realized prefecture level election in 1995.
Although “National healthinsurance act” was planned to make integration of different funds in 1989, it becamea rejected bill by the presidential refusal rightor veto. The points of the Act
was (1) establishiment of the insurance pay deliberation council, (2)introductionof prgressibe premium, (3) Introduction of Judges of Medical treatement expense,(4) Using a half price of pension person into medical treatment for pentioners.
(5) State subsidies for the premium of self-employees.
A reason of a presidential refusal was that a privilege-like position of wealthy
health insurance associations become weak, if the funds integrate in one. It may
be to keep the existing privilege of rich funds. However, during this period, many
regional or local health insurance associations (funds) were established,consecuently urban self-employees class joined in them. So we can call this period
is the era of an establishment a national insurance system or universal principle
system based on the union system.
(3) The third controversy (1993 - 1999)
In 1995 health insurance funds started its common financial payment with statesubsidies. On the other hand, aiming to promote integration of health insurance systemby the power of grass roots movement, "Health care solidarity council” was establishedby labor union, hospital worker union, insurance medical institutions, farmer group,a female group, and citizen groups.
Based on "National health insurance act" in December, 1997, integration with regional
health insurance funds and public servants and teacher’s insurance funds was donein 1998.
Korea was kept under IMF system management due to an economic crisis from 1997 to4

2001. This enforced to Korea to effort the preparation of social safety net.
President Kim Dae Jung advocated "productive welfare state" and " democratic market
economy" and considered to promote a social safety net by state intervention. Though
it enacted "citizen health insurance law" to have aimed at integration withoccupational health care funds and regional health insurance funds in 1999, in orderto make a plan of financial integration through the National health care Act. However,both occupational and regional insurance funds did not change the standard of thecontribution, the richer finance of the occupational funds were diverted to theregional insurance funds. This was one of political manipulation to gain the supportof local voters.
(4)
The reasons of Controversy on Health care system
For a main controversial point of destructuralization of National Health Insurance
System were three. First model was a Double pillars model (traditional both
occupational and regional insurance fund). The advocators are called Unionist.
Second model was to establish unique insurance fund corporation (such as existing
Corporation). So called Integrationist supports this model. Third model was aprefecture area insurance fund model supported by local doctor society. After all,second model was adopted. That is an integrationist model. According to the ideaof the integrationist, if we integrate functions of each fund, we could dissolve
the financial difference among funds and make benefit equal. The state also decided
to supply the 50 percent of the cost of benefit.
Some critics exclaimed this model improves the redistribution function in healthcare supply system and the established independent Health insurance certification
institute contributes to promote democratic and independent character of thedecision making in medical care cost calculation standard. Moreover, contractsystem between insurers and medical institutions established through the reform.
Health insurance system originally began as a fund union model. But this model
was, according the opinion of integrationist, the cause of the inequality amongclasses and regional areas.
Health Insurance system began to adopting fund union model. But according to theopinion of Integrationist, this model is a cause of the inequality between
occupational fund and regional fund and if it could be possible to appropriate thereserve funds of the occupational funds to the regional funds in order to uniformthe benefits; all funds could reduce management cost and realize equality of thecontribution standard. In reality, the reform has promoted due to this idea. However,
it is not always to stabilize health insurance financial budget as a whole. As
the national health care cost has increased, the government must adapt the policyof raising both the contribution by users-patients and subsidies by the state, as
applying the unification of different funds into the health insurance Corporation.
Citizens’ movement against the raising their contribution in the system has become
intensive more and more. On the other hand, there is a problem that the check to
the income of self employees is very weak in order to decide the standard of thecontribution payment.
The unionist model has been supported mainly by the established organization ofindustrial sector, labor organizations, namely big enterprises and its related
stable trade unions. On the other hand, the group of self employees in the medium

5and small enterprise and local residents in agricultural and fishing village areas
has supported the integrationist model.
At this moment, there is an alternative plan to reform from the integrationist
model (social insurance model) to tax based model. However, in this case, it issaid that important thing is to catch the tax obligation for the self-employees
or to introduce the consume tax or social security tax, in order to decide the standardof their insurance contribution or premium.
3. Health care reform in 2000 and the actual situation.
Health care reform in July, 2000, has two pillars. Namely, one is so called“Integrate reform” which integrates differences of insure funds into single payment
insurer fund and another is “Separate reform” which separates the medicine or
pharmacy service from revenue of medical institutions and make pharmacists sell
both prescribing medicine prescribed and general medicines. However about anevaluation of these two reformations were still not confirmed.
(1)
Division of labor between medical function and medicine function.
Division of labor between Medical and medicine functions was started due to themodification of the Pharmaceutical Affairs Law in 1994 and the Separation of
Prescription and Preparation of medicine Act in August 2000. The total sale ofmedicines of the year of 2001 becomes twice as much as that of 1999, centering
the sales in pharmacies over 60 percent. On the other hand, the share of the sales
by hospitals declined from 42 percent to 27 percents especially that of the clinics
went down drastically from 20 percent to 4 percent. In Korea, the sale of pharmacy
has occupied high in the total sale of medical institutions, so the objection of
the doctors associations for this separating reform was very strong. Doctors’
associations got strike against the reform during 1999 to 2000. The lobbying by
the doctors associations was strong. Consequently, the payment for the medical
treatment increased by 41 percent by reason of filling a deficiency of the existedback margin of medicine for doctors and the fee for prescription for medicine also
increase five times.
Some critics note this is a cause of the deficit of the finance of the Health
Insurance system. The government at first intended to decrease the total healthcare cost through cutting the drug revenue of the medical institutions based on
the separation of the function of prescription and provision of medicine. However,on the contrary of the expectation of the government, the cost of the pharmacy
increased by 25 percent in 2001 and also increased doctor’s fee in comparison of
the last year. Moreover, the foreign pharmaceutical companies have increased theirsales through the sale of cheaper generic medicines. The public opinion to theresult of this reform is not good and 80 percent of the citizens answered to thequeasionary in that the health service become worse and or not change than before(Daily Choson, 13.9.2003). We can estimate the plan of making the Medicine
distribution corporation offered the function of evaluation of the price than theplan of making free market for medicine.
Table. 3. Evolution of affiliation rate of National Health Care system.

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Year rate
New Main Insurant or condition
1977
8.6%
Companies over 500 employees.
1980
24.2%
Companies over 300 employees, public servants, teachers.
1985
44.1%
Companies over 16 employees.
1990
93.9%
Companies over 5 employees. Self-employees.
1995
97.6%
Payment for 180 days and for High cost care.
1999
96.4%
payment for 365 days.
Resource: “Report on Korean Health insurance reform”, Federation of Health Insurance
Unions, 2003.
Table. 4. Classification of the medical institutions (2001)(Hospital: over 30 beds, general hospital: over 100 beds)
Total
2,774
General hospital
278
Hospital
706
Clinic21,340Dental hospital
71
Dental clinic
10,790Chinese (Korean) medicine hospital
139
Chinese (Korean) medicine clinic
7,558
Pharmacy
18,372
Midwife centre
87
Resource: “Report”, FHIU, 2003
Table 5. Income of National Health care cost (2001)
Total
30679.9 billion won
Public finances
13615.7 million won--Central government(2217.7 m)--Local governments(876.6 m)--Social insurance(10527.4 m)
Private finance17064.2 m--Private social insurances(1319.9 m)
Private insurance companies(1343.3 m)
Households(12667.7 m)
Non profit organization(121.8 m)
Private companies(1611.5 m)
Resource:“Report”, FHIU, 2003.

share
44.4%
(7.2%)(2.8%)(34.4%)
55.6%(4.3%)(4.4%)(41.3%)(0.3%)(5.3%)

Table.6. Population adopted in Health Insurance and its affiliated number (2001).
(Unit: thousand)Total Population
47,343Population for Health Care System
47,882 (double count) Member
Average premiums-Health Insurance 46,379(96.9%)
30,50011,274won--Occupational funds 18,503(38.6%)
6,000
26,631WON--Publics servant

7

&teachers funds
4,666(9.75%)
1,400--Regional funds
23,212(48.5%)
23,100-Medical on Agency Assistance
1,503(3.1%)
Resources: “Report”, 2003 and NHIC, 2001.

38,673won
36,253won
without a fee

Though a definition of dependants of insurants in Korea are considered as“a person without revenue and supported actually by an insurant”, the range is
widely in comparison with Japan including brothers and sisters. Dependants
concentrate on occupational insurance funds and the average dependents number is
2.08. On the other hand, a class of self employees occupies approximately a halfof population. Medical assistance system has similar ideas as Medicare andMedicaid in USA.
Figure2. New National Health Insurance system in Korea

Money

ServiceCompany,
Employer

National Health
Insurance Union
NHI

CentralGovernment

Certificatio
Institution

Medical carefor the poor

Pharmacy

Clinics

Public medical center

NationPatients

Hospitals

4. Revenue and payment forms of Health Insurance system.
(1)
Medical treatment payment system
Korean Government tries to decide a unit price of medical treatment service basedon the total cost calculated resources prices. The Corporation and Health insurance
Revision Agency (HIRA) decide a unit price of Medical treatment service with anegotiation every year with representatives of medical institutions. If advancing
in a direction of total frame budget cut for a unit price standard of medical treatment
pay based on actual results date in the last year, a gradual fall of a quality ofservices will inevitable. In case of Korea, as well a negotiate bargaining power8

of the interest parts are very strong such the case that medical doctor association
could attain a rise in a price of medical treatment service, as making the pricestandard will link highly with a political negotiation. It is a different approachto that of Japan decided unit price standard by the hand of welfare ministry
unilaterally with the policy making intention.
Revenue resources of medical practitioners are composed by three factors; (1)medical treatment payment contract (2) patient payment, (3) special arrangement forcorrupts of contract negotiation. Presentation of receipts for the HIRA has two
types; whether documents or electric data. Receipts are ordered a week. HIRA wasestablished in July of 2000. Director board is composed by 16 persons including 5
persons from Medical and Phamathetical industry, 3 persons from insurance
corporations, 5 persons from labor union and civic organizations, 3 persons frompublic authorities. Their tenure is three years. HIRA has 1,500 staffs, including
40 doctors, 1,000 nursing practioners. The administration cost is derived from theInsurance Corporation as a year budget. However some critics say it is better toreceive financial fund from central government directly in order to keep HIRA’s
independency.
Korean government tried to control the total cost of health care system, but,they found the increasing of the cost after all. The financial crisis of the healthcare system born deficit of 2.7 trillion won in 2001, as 25% of the governmental
budget. Some explain main reason of the deficit after the system reform is thatgovernment admitted for doctors to raise care treatment cost instead of taking off
the pharmacy payment in the revenue payment agreement. On the other hand, government
plans to raise premium of the health care system 9 percent per year by 2006. Doctors
have dissatisfaction with low level of their revenue through the treatment payment
system. However government also has no power to decide unliterary the standard of
payment. So the bargaining by two parts is traditional decision making process.
Most critics agree that there is no effect to defend the budget expansion if government
decides decreasing of treat payment against doctors. If government does, doctors
would increase number of examination for patients in order to keep their revenue.
Medical system develop special committee announced that the fixed number of thestudents in 41 medical colleges will be decreased by 10 percent during the year of
2004 and 2006.
The crises of the business of medium and small hospitals are making them to advancein the China market, which the total investment has reached 1.75 million dollars
by August of 2003. The advanced medical services of Korea including cosmetic surgery,dermatology, dental and obstetrics are planning to get into China market.
Payment system for utilizing efficiently the resources is mixed of two methods:
payment for services and payment per capita. In the case of the payment for services,
the income will increase if the number of patients increases. However it is apt toincreases responsibility of the risk and over medical treatment. On the other hand,the payment per capita system is apt to decrease the risk responsibility for users,
because of the income does not depend on the content of the medical treatment.
Korean Government has introduced in 2001 “The relative value standard system”
which aims mixed payment mechanism, referring the point system in USA. This systemdoes not explain the real cost of the medical service such as the Managed care in
the USA. Moreover introducing of DRG may bring both pre-determination and fixation9

of medical treatment cost. DRG already has partially introduced since 1997 andachieved experimental adaptation, but some said that DRG is not necessary to link
the improvement of the quality of medical institutions.
Government decided to decrease the benefit of exemption of medical fee of workers
from the adaptation for those who pay the sum of over 3 percent of the annual income
to those who are that of over the 5 percent. Consequently, the 60 percent of theexisting users who had received this benefit will be excluded.
The 73 percent of the nation think that the separation of the medical payment
and pharmacy payment brings the increasing of patient payment. People do not estimate
this reform successful at this moment.
(2)

Insurance premium system
Because that there has been very low to the portion of levy of health insurance
contribution among local self employees (about 30 percent of them), the standard
how to collect premiums from them based on the total property including income,properties and price of cars. It is very unusual that 89 percent of the self employees
are under 5 million won annual income. The average monthly wage of employee belong
to professional union is 1.47 million won in comparison that of self-employee is0.86 million won. However if the rate of the capture of the income for them is only
30 percent, the real income of self-employee can be 3 million won. In Korea, thepercentage of the self-employees in the society is 45 percent which is higher thanthat of Japan. The problem seems to be caused from the mechanism of levy.
In the health insurance system, there are two different standards for the twodifferent insured. Those who belong to the professional union are adapted 3.4 percentof the monthly income and the employers also pay same amount. The minimum income
per month of the insured must over 28,000 won per month.
In the case of self-employees, classification of the premium is divided in theline of 5 million annual incomes. The lower group is classified 30 sub-classes andthe higher group is classified 50 sub-classes, adding the 50 portions based on property
and 7 portions of price of cars.
Patients pay at the service normally 30 percent at the clinic and from 40 – 65
percent at the hospital and normally 30 percent for dugs. The more advantage
treatment adapted, the more the payment of patient increase.
It is said that Korean government plans to increase insurance premium from theexisting 3.9 percent to 6.7 percent and provision portion from 52 percent to 70 percent
by 2008. Government also plans to increase public medical institutions double fromexisting 15 percent to 30 percent.
(3)
The Medical care system for the poor
When the establishment of the health insurance system in 1977, those who is objectedto the poor benefit system was exempted the payment of premium. However, in 1997,
due to modification of the Poor Act, self- help of the poor become recommended.
At this moment, those who do not reach the minimum income (513 US dollars a month),and special groups are adapted the exemption of premium. However, according to theofficial statistics, only 3.8 percent of the population is classified as the poorgroup, the 10 percent of the patients in public hospitals and 1 percent of the patientsin private hospital are the poor. So to reform the quality of public hospital or10

public health center will contribute equity of access for medical care for the poor.
It is said that the poor groups can not access a private hospital which set highprice. So in order to improve the access right, some claims an idea to make private
hospitals and clinics a gate-keeper.
In the medical care system for the poor, there are two classifications: class
one is for the invalids and over 60 years old person; class two is for the poor who
is able to work. At the end, there is no clear distinction between health insurance
system and The Medical care system for the poor in the process of access.
(4)

Medical NPO & Cooperative institutions in Korea
As parts of traditional Non profit and Cooperation Sector in Korea, agricultural
cooperatives, credit unions and foundations are still now subordinated under thecontrol of public authorities, with motivation of private profit, and are seemed
to be lack the principle of participative democracy (Kitajima and Bidet, 1999).
Another cause of stamping of the worker welfare movement is that no mutual aideorganization, which we can see in Europe, has developed.
At this moment, two types of Non profit and cooperation organization exist in Korea,
in which the number of notified NPOs is about 11,000 and non-notified NPOs are about
50,000. The 74 percent of the NPOs are established after Democratization period of
1987. The legal statues which control NPO and Cooperation organization are Civil
Code, the NPO establishing Act and relative legislations such as Medical treatment
Act for medical institutions, the Social welfare Act for welfare organizations.
The groups of Non profit and cooperation sector in Korea are composed bycooperatives, NGO, NPO, civic movement organizations, foundations, public benefit
organization and etc. Under the military regime after the independent since 1948,
there was no room to develop such Non profit sector. In stead of them, neighborhoodorganizations, kinship organizations and rligious organizations are popular as
informal sector. During the process of democratization of the era of 1980s, many
Non profit organizations are born. In 1999, Nonprofit organization promotion act
in 1999 become a tool of public profit activity by civic volunteers.
Medical Institutions has a character as a non profit based on the Medical
Institution Act, as equal as in Japan. However, it is not certain whether such medical
institutions keep a NPO principle such as “private, autonomy, non distribution of
profit and self government” or not. Especially, the principle of Democracy will
be a very important one in order to classify the NPOs. Due to the character of NPO,
private medical hospitals have received tax benefits of company law, local government
tax and donation.
At this moment of 2002, some NPO and cooperative Medical institutions aredeveloping in Korea.
Main actors are six Health care (Medical) cooperatives. Them oldest is Ansong Health
Cooperative established in 1999. Rests which are young were established during 2000
and 2002. College Health Cooperative is existed in Pohang University. There is somedemocratic medical institution which has developed in the community since 1992,
especially in poor zone of Seoul City. Another group named Wonjin labor accident
protection committee which has established Green Hospital through the movement ofprotection of medical access right of workers.
Most of the civic medical institutions are created after 1987 through11democratization. Humanitarian practice doctor’s council which aims democratic
medical practice also started in 1987.
5. Perspective in future
Though Korea has promoted healthcare provision in its social policy since 1980s
as a basic condition for economic development, the portion of health care cost in
GNP has been lower than that of developed countries. So, Korea has a room for increase
several times the total health cost in order to become same portion as Developed
countries. Learning from that European countries utilize the NPO and cooperative
sector (the third sector) as a tool of provider for welfare and social services,
and also as a tool of resolving new needs of unemployment problem and social
integration problem, Korea too has a possibility to adapt same policy for the third
sector instead of the traditional family system and kinship system, with their own
arrangement in the society.
The Health Insurance Corporation plans to improve management, stability of finance,
quality of service, restructuring of organization and efficiency of service. OECD
report recommends on the health insurance system that Korea should introduce up ofpremium, establishing total cost plan, the improvement of equality of access right,
the introduction of DRG in order to seek cost efficiency, partial build in of liquor
and tobacco tax for the health care finance, improvement of governance andaccountability of insurers, promotion of regulation and self-regulation of medical
institutions and primacy of preventive medicine. Moreover OECD recommends the MAS,
Medical Saving Account, now introduced in Singapore; in which individual patient
accumulate its own payment account for medical services. However, in Singapore,
there exists discrimination policy or division of labor policy that appears criticaldifferences between public hospital which cover ordinary people and private hightechnological hospitals controlled by foreign investors, which cover the rich people.
So if Korea government will adapt the Singapore model in accordance with therecommendation by OECD, it is inevitable to increase inequity and profit seeking
in Medical services and to decrease the public intention, namely it became not a
Universal system but a Residual system in Health care system. In this case, main
purpose of government policy would be budget cut of the health care system.
Some exclaim based on the principles of public responsibility and equity the
introduction of NHS system of Britain financed by taxation into Korea. Some also
recommend that French system of Social protection is better because that defines
the responsibility of employers in it.
There are many stakeholders in discussing the health care policy, such as medical
practioners, patients, employers, self-employees, wage-workers and labor or civicorganizations. In comparison with a market in which competition is main principle,
Health care industry should be recognized as based on the principle of public interestor cooperation. If so, many different stakeholders can cooperate to realize social
solidarity in the field of health care service. Consequently, it promotes theredistribution of resources by the hand by the state.
Reference literatures“Review of the Korean health care system”, OECD, 2002.
Meesook Kim, “Social Security and Social Safety Nets in Korea”, World Bank, 2002.

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Ian Gough, “Welfare Regimes in East Asia and Europe”, World Bank, 2000.
I.Kim & C.Hwang, “Defining the Nonprofit Sector: South Korea”, The Johns Hopkins
Comparative Nonprofit Sector Project, 2002.
“National Health Insurance Program in Korea 2001”, NHIC, 2001.
http:/www.mohw.go.kr
E.Bidet,”Economie sociale et nouveaux pays industrialises: Le cas de la Coere duSud”, Annals of Public and Cooperative Economics, CIRIEC, 2000
K.Kitajima & E.Bidet, »Comparative analysis of Social Economy among France, Japanand Korea « Matsuyama University, discussion paper (Japanese), 1999.

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