The South Korean government will begin a new policy in the second half of next year to include caregiving costs for severely ill patients under health insurance coverage. Currently, these caregiving expenses are fully borne by patients or their families. The move aims to reduce the financial burdens on families of patients requiring long-term care, with a focus on preventing “caregiving murders” and “caregiving bankruptcies” by providing support for hospital caregiving costs.
The government plans to reduce out-of-pocket expenses for patients needing severe nursing care to just 30% by 2030, with a projected funding of 6.5 trillion Korean won allocated to the initiative.
Reducing Caregiving Costs for Severe Cases
A public hearing titled “Innovation in Medical-Centered Nursing Hospitals and the Inclusion of Caregiving Costs in Insurance Coverage” was held on September 22nd by the Ministry of Health and Welfare at the Royal Hotel in Seoul. This policy is one of the key national priorities outlined by President Lee Jae-myung’s administration.
Under the new plan, monthly caregiving costs, which currently range from 2 million to 2.67 million Korean won, will be reduced to about 600,000 to 800,000 Korean won for severely ill patients. This will not apply to all hospitals or patients but will target individuals with high medical needs, such as those on ventilators.
As of 2023, approximately 215,000 patients are hospitalized in nursing hospitals across the country, with around 80,000 of them classified as severe cases.
Insurance Coverage for Medical-Centered Nursing Hospitals
The government will select “medical-centered nursing hospitals,” where more than 40% of the patients are severely ill, and apply insurance coverage only to these patients. The plan will begin with 200 hospitals in the next year and aims to expand to 500 hospitals (with a total of 100,000 beds) by 2030.
Challenges in Implementation: Caregiver Shortages
One of the most significant challenges in implementing this policy is securing an adequate number of caregiving staff. The government has proposed a system where one caregiver will support four patients, working across three shifts, instead of the current arrangement, where one caregiver manages five to six patients over a five-day period.
To address this shortage, a new “dedicated nursing fee” will be introduced, allowing nursing hospitals to hire dedicated nurses for caregiver training and management. However, recruiting enough caregivers for 200 hospitals next year will be a considerable challenge. As a solution, the government plans to recruit foreign workers, particularly from outside the capital region. This includes training unemployed foreign residents through standardized programs and language education to become caregivers. Universities will also be designated to train foreign nursing care workers, including attracting international students.
Financial Considerations and Future Outlook
The financial burden of the initiative, projected to be 6.5 trillion Korean won by 2030, raises concerns. The National Assembly Budget Office has already indicated that health insurance finances are expected to turn into a deficit this year, with reserves likely to be depleted by 2028.
The Ministry of Health and Welfare plans to present the policy to the Health Insurance Policy Deliberation Committee, the highest decision-making body for health insurance policy, on September 25th. The government intends to officially announce the full plan in December. Minister Jeong Eun-kyeong emphasized that the integration of caregiving costs into insurance will be closely linked to the development of patient-centered community care.
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