How You Get Korean Medical Coverage
This sections covers the conditions under which an employer must pay for the employee's coverage and those where the employer is not obligated to pay. It also provides information on what health insurance options are available for non-covered Foreign employees or for foreign business owners. Please read the other sections on this topic to ensure that you are fully informed. Or to ensure you have possibly more current information, visit the National Health nsurance (NIHC) website.
The Legal Structure and Important Articles
There are two Acts that pertain to Health Insurance: the Health Insurance Act and the Labor Act. The Labor Act is subservient to the Health Insurance Act and simply mentions that the Employer must pay for 50% of the Health Insurance and that Employees who work less than 60 hours a month are not required to have Health Insurance. The Health Insurance Act stipulates that all employees who work 80 Hours or more must participate in a Health Insurance Plan and that any company that employs more than 5 Foreign workers must enroll the Foreign Workers in a Health Insurance program.
There is a gap of 20 hours between the Labor Act and the Health Insurance Act; the Health Insurance Act is the guideline to follow. The Health Insurance Act does not state what type of Health Insurance Coverage the Employee should receive: that is determined by the contract between the Employer and Employee. Subsequently, many employees have been enrolled into Private Insurance programs. Usually the Private Insurance programs are simple accident insurance which leaves Foreign Employees underinsured and with limited coverage.
An additional issue that has come up as of late is that many Korean Employers will not register the foreign worker as an employee, but rather as an independent contractor. An independent contractor must provide their own health insurance. The disadvantage the employee suffers it that the employee wins the action they are responsible for 50% of the contributions since the starting date of their employment even though they were not registered. The good news is that all health care costs since the start of the employment date can be reimbursed due to the fact that the coverage is retroactively.
In the case that a Foreign worker decides to enroll them selves in the program they must pay the full contribution rate. In addition, once they are enrolled they cannot opt out of the program. For D-8 VISA holders they have a different contribution rate that follows the standard rate for Self-Employed Koreans. Below is a chart with the different rates and contributions listed in a table. Please note that there is a yearly adjustment to the rate and the information below is current for 2008 only. At the time of your enrollment you should verify the rates.
|National Health Insurance Contribution Rates for the Year 2008 as a % of Wages|
|Employee Insured by their company||Contribution Rate||A total of 4.77% of the employees wages with the Employer contributing 50% and the Employee Contributing 50%|
|Employee Insured by themselves||Contribution Rate||Minimum of 59,800 WON to a Maximum of 4.77% of Wages paid by the employee themselves|
|Family Members of Foreign Workers||Contribution||48,000 WON** this rate would be used for Children, dependent spouses etc. but may vary based upon the status of the primary VISA holder|
|Self-employed Insured||Value per Point||139,900 WON|
Please note that the rates are based upon Wages and not Income. Income is the total monies that you receive, while Wages are the amount of money you receive on a regular basis as a result of your contractual agreement.
The Employee Insured
The contribution of employee insured is based on salary of the insured. And the current contribution rate of the employee insured is 4.77%. The contribution of the employee insured is borne by both a employee and a employer. For an employee in the private sector, the employer pays 50% of the contribution and the employee pays the other 50%. For government employees, the government, as their legal employer, pays 50% of the contribution, and the public servant pays the other 50%. For private school employees, however, the owner of the private school pays only 30%, the government subsidizes 20% of the contribution and the employee pays the remaining 50%.
The Self-employed Insured
For the self-employed insured, contributions are basically calculated on the basis of income. The contributions are calculated by using a formula in which the insured person’s properties, income, motor vehicles, age, and gender are taken into consideration. However, there are two types of formula for the calculation of the self-employed insured’s contributions. Two different formulas apply to two different income groups: one group for individuals whose income is less than 5 million WON each year, and the other for individuals whose income is 5 million WON or more each year.
The contribution amount of the self-employed insured is set by their total contribution points and value of each point. Value points are calculated based upon the total amount of income the Self-Employed persons’ Company is earning, their property and their automobile assets and then used for the calculation of the required contributions. You are advised to seek a Tax Attorney to ensure you are not over paying if you are self employed.
Currently, the value per point is set at 139,900 WON. The calculated contribution is paid by the insured and the government subsidizes about 50% of total expenditures for both the payment of benefits for the self-employed insured and its administrative costs.
What Is Covered and How Much is Covered?
Patients are given almost unconstrained freedom in choosing providers and can choose both western and oriental medicine. The third-party payment system has been adopted for reimbursing health care institutions for their medical services and providers are paid mainly by fee-for-service. With regards to administration of the NHI program, NHIC, the unique insurer, is responsible for operating the program, the Health Insurance Review Agency (HIRA) is in charge of reviewing claims of providers, and the Ministry of Health and Welfare supervises the operation of the NHI program as a whole. You have the freedom to choose your Health Care Provider. An Employer cannot dictate which Health Care Provider you use and if the Employer does so then it is time to review your Health Insurance Plan. If the Employer is insisting that you go to specific Health Care Providers you are not enrolled in the National Health Insurance Program and you have further limitations that you should be made aware of.
For more information and additional details on the health insurance plan and how it may affect you, scroll down and click on the various topics listed.
Contact NHIC: English helpline 02-390-2000 or NHIC website.
K4E Editor: We try to make the information on Korea4Expats.com as complete and accurate as possible, so if you notice any errors or omissions in the content above, please let us know at email@example.com.
Last Updated on 2017-01-10
|In the same header|
|Apply for National Health Insurance||Health Insurance for Foreign Residents|
|How You Get Korean Medical Coverage||Intro to Korean Health Insurance|
|What is Covered and How You Pay for Medical Expenses|
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