Fiscal health of 'Mooncare'

Policymakers should ensure sustainability of health insurance

President Moon Jaein has boasted of his generous healthcare policy, dubbed "Mooncare." on Monday he said people have seen their medical bills decreasing since January 2018 thanks to the new plan. According to the Ministry of Health and Welfare, 36 million patients have saved around 2.2 trillion won ($1.9 billion) in combined healthcare bills since then.

Moon made it clear that his administration will continue to expand the National Health Insurance Service's coverage, especially for those in the low-income brackets, children and the elderly. Of course, Mooncare has had its share of strong protests from political opponents and medical doctors. But it is a step in the right direction, given that the coverage rate is still relatively low compared to other OECD countries.

Yet the problem is that more benefits require more of a burden. Last week, the government tried in vain to raise the insurance premium by 3.49 percent for next year because of a strong backlash from both unions and businesses. In fact, the premium has gone up by an annual average of 3.2 percent over the last 10 years. This year alone, it was raised by 3.8 percent, much higher than last year's 1.5 percent hike in consumer prices.

It is inevitable that Moon will have to increase premiums to make good on his campaign promise to boost the health insurance coverage rate to 70 percent by the end of his term. The rate rose from 63.4 percent in 2016 to 67.2 percent in 2018. But some critics fear health insurance funding may run out of money as early as 2023 if the President keeps his promise.

Few subscribers are against higher benefits under Mooncare. Yet its success will depend on how to ensure the health insurance's fiscal soundness. Right after Moon's term ends in 2022, the insurance system is highly likely to run a huge deficit largely due to ever-rising healthcare coverage costs.

Mooncare is not free just as there is no such thing as a free lunch. The authorities should work out a long-term plan to keep health insurance afloat. If it wants to push up the premium, the government needs to build a consensus among workers, employers and medical professionals. It must figure out why doctors are threatening to strike, calling on Moon to retract what they call a populist healthcare policy.