The government has frozen next year's national health insurance premium rate at 7.19%, even though the fund is likely to post its first deficit in six years this year. The Ministry of Health and Welfare convened the Health Insurance Policy Deliberation Committee on the 8th and held the 2027 rate at this year's level, saying the insurance finances "are being managed stably." The ministry cited surpluses over the past five years, reserves equal to three months of spending (about 30 trillion won), an increase of 1.1 trillion won in government support, and higher revenue on the back of a semiconductor boom. The rate had been frozen at 7.09% for two straight years in 2024 and 2025 before rising 0.1 percentage point this year.
What concerns us most is the government's complacent reading of the situation — that the insurance finances are stable. The fund ran deficits for three consecutive years from 2018 to 2020. It then posted annual surpluses of 2 trillion to 4 trillion won, but the surplus shrank sharply to the 1 trillion won range in 2024 and to 499.6 billion won last year, before swinging to a deficit of nearly 4 trillion won in the first quarter of this year. The reason is structural: as births fall and the population ages, the working-age population that pays premiums is shrinking while the number of older adults soars, locking in a pattern in which spending outpaces revenue. The National Health Insurance Service's warning is not to be taken lightly — on the current path, reserves will be exhausted by 2029 and the cumulative deficit will reach 563 trillion won by 2042.
With a funding shortfall clearly in sight, the government's failure to move aggressively on spending restructuring and revenue expansion amounts to an abdication of responsibility. Suspicions have been raised that the freeze was decided out of concern over adding to household burdens at a time when the administration's approval rating is falling sharply. While lukewarm on stabilizing the fund, the government has widened coverage, including additional support of 600 billion to 800 billion won a year for 1.97 million people such as patients with severe or rare and intractable diseases, older adults and children.
If the government misreads the situation, a sound prescription cannot be expected. It must first take a hard look at the state of the insurance coffers and ensure there is no margin of error in its long-term fiscal projections. Above all, it should raise coverage for essential care while sharply increasing out-of-pocket rates for excessive treatment to stop leakage from the fund. It also needs to strengthen the fund's soundness by properly implementing the mandatory provision requiring the government to cover 20% of expected premium revenue from the national treasury. It is time to put the health insurance system — the last line of defense for people's lives — on the operating table for reform, before it falls gravely ill.
