National Health Insurance Corporation submits fiscal revision forecast for 2024 to the National Assembly
The current balance surplus increased by 258.2 billion won compared to the February forecast.
“Total expenditures slightly increased due to a decrease in salary costs at tertiary general hospitals.”
If the commercial restructuring project is reflected, losses will occur starting next year.
4 trillion deficit in 2026 and 2027… Reserves are gradually decreasing
ⓒNewsis Despite the prolongation of emergency treatment, it is predicted that this year’s health insurance finances will record a surplus of 2.8984 trillion won in balance as medical use at tertiary general hospitals decreases. This amount is more than 200 billion won more than predicted at the beginning of this year.
However, with a huge amount of money being spent on medical reform, a deficit of more than 1 trillion won is expected from next year, and cumulative reserves are expected to fall from 24 trillion won as of September this year to 19 trillion won in 2028.
According to data submitted by the National Health Insurance Corporation on the 25th by Democratic Party lawmaker Park Joo-min, chairman of the National Assembly Health and Welfare Committee, the National Health Insurance Corporation made this forecast for its finances in 2024.
Last February, the National Health Insurance Corporation announced that it would be possible to maintain stable reserves until 2028 through the financial outlook for the 2nd comprehensive health insurance plan. As of September, the National Health Insurance Corporation’s reserves were 24.43 trillion won.
However, as emergency treatment support due to medical gaps is prolonged and more than 10 trillion won is planned to be invested in medical reform, concerns about worsening health insurance finances have grown, and recent government audits have repeatedly pointed out this. Accordingly, this year’s fiscal forecast was recalculated and related data was submitted to the National Assembly.
According to the revised forecast, this year’s health insurance finances will see a surplus of 2.8984 trillion won in current fiscal year. This is an increase of 258.2 billion won compared to the 2.6402 trillion won expected at the time of the February forecast. The cumulative surplus is expected to be 30.8961 trillion won, an increase of 258.2 billion won from 30.6379 trillion won.
The reason the expected surplus has increased is because the increase in total income is greater than total expenditure.
Total revenue is estimated at KRW 99.3918 trillion, an increase of KRW 496.3 billion compared to the original forecast of KRW 98.8955 trillion. Expectations changed as the year-end settlement insurance premiums for employee subscribers and the number of household heads and premiums per household for local subscribers increased.
Total expenditure is expected to be KRW 9.64934 billion, an increase of KRW 238.1 billion from KRW 96.2553 trillion, which was influenced by support for emergency treatment and advance payment for teaching hospitals.
Specifically, a total of 623.7 billion won was actually paid in emergency medical support as of the end of September, and approximately 1.0209 trillion won is expected to be paid by the end of the year.
As of October, a total of 1.4843 trillion won was paid in advance. However, since the advance payment is settled by offsetting next year’s billed salary expenses, it is not considered a net increase in expenses.
Overall, spending has increased compared to the original projection, but there are some areas where spending is expected to decrease.
From January to August of this year, salary costs at tertiary general hospitals decreased by 11.6% (KRW 1.4072 trillion) compared to the previous year, and overall salary costs increased by only 1.8% compared to the previous year. In the past, the overall salary ratio increase rate from January to August was 5.8% in 2021, 12.5% in 2022, and 7.5% in 2023, but the increase rate has decreased significantly compared to this time.
The National Health Insurance Corporation analyzed that “even if emergency treatment support is extended until the end of the year, total expenditures will increase slightly due to the decrease in salary costs at tertiary general hospitals.”
With regard to finances from 2025 to 2028, the National Health Insurance Corporation is expected to record a surplus of 1.1288 trillion won in the current fiscal year in 2025, then turn into a deficit starting in 2026 and have a deficit of more than 1 trillion won every year until 2028.
In addition, if expenditures for pilot projects for structural transformation of tertiary general hospitals are also taken into account, the period of seeing a deficit in the current fiscal year will be pushed forward to next year.
Deficits will continue to occur, including KRW 1.0612 trillion in 2025, KRW 4.2871 trillion in 2026, KRW 4.3221 trillion in 2027, and KRW 2.2171 trillion in 2028. Accordingly, the reserves estimated to remain in 2028 are approximately KRW 19 trillion.
As originally planned, the National Health Insurance Corporation plans to invest 10 trillion won over five years in essential medical care, and will continue to invest in necessary areas, such as pilot projects for structural transformation of tertiary general hospitals, in consultation with the medical community.
The scale of expenditure may vary depending on the participation rate in the future tertiary general hospital restructuring pilot project and the number of mildly ill patients moving from tertiary general hospitals to general hospitals or lower. According to the Ministry of Health and Welfare, as of the previous day, the restructuring of eight general hospitals had begun, and an additional 10 hospitals have submitted applications and are scheduled to be reviewed.
If all 47 general hospitals participate in the pilot project, annual compensation of 3.3 trillion won will be received. Assuming that 10% of patients with mild symptoms at tertiary general hospitals move to general hospitals or lower, it is estimated that there will be a financial savings of approximately 110 billion won+α.
The National Health Insurance Corporation announced, “We plan to re-conduct the financial forecast early next year, reflecting this year’s income and expenditure performance.”
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