Effects of the benefit extension policy on the burdening of health care expenditure for households with patients of chronic or serious case

Abstract

Korea ranks high among the OECD member countries with a high out-of-pocket share. In 2006, the government implemented in full scale the policy of extending the health insurance benefit coverage. Included in the policy are lowering the out-of-pocket share of patients of serious case and expanding the medical bill ceiling system to mention just a few. This study proposes to confirm effectiveness of the benefit extension policy by identifying changes in `out-of-pocket expenditure as a share of the ability to pay` and `incidence rate of catastrophic health care expenditure` of each individual household as manifested before and after the benefit extension policy was implemented. The 1st and 3rd year data from the Korea Welfare Panel Study (KoWePS), conducted by the Korea Institute for Health and Social Affairs (KIHASA), were used for the analysis, where low-income households and ordinary households are sampled separately. While the absolute amount of `out-of-pocket expenditure` occurred to the average household increased for the period 2005-2007, the `out-of-pocket expenditure as a share of the ability to pay` decreased. At the same time, the share decreased in the case of low-income households and households with patients of chronic or serious case as contrasted with ordinary households. `Incidence rates of catastrophic health care expenditure` of ordinary households for 2007 stood at 14.6%, 5.9% and 2.8% at the threshold of 10%, 20% and 30%, respectively. The rates decreased overall between 2005 and 2007, while those of low-income households with patients of serious case statistically significantly increased. An analysis of this study indicates that it is related with the medical bill ceiling system regardless of incomes introduced in 2007.