NHI Reform Passed, Yaung Tenders Resignation

NHI Reform Passed, Yaung Tenders Resignation

Sources: All Taipei newspapers

January 5, 2011

The Legislative Yuan yesterday passed the so-called second-generation National Health Insurance (NHI) reform by revising the existing National Health Insurance Act in third reading. However, Health Minister Yaung Chih-liang last night said that he had tendered his resignation to Premier Wu Den-yih, a decision which stunned legislators across party lines. The Executive Yuan (cabinet) replied that it would try to persuade Minister Yaung to stay on in his post.

In the future, a dual-track system will be adopted for premium payments in the second-generation NHI program. For the general public, the premium rate will go down from the current rate of 5.17% to 4.91% based on the policyholders’ insured monthly salary. A supplementary premium will be based on six categories of policyholder’s other incomes, with the premium rate set at 2%. The six categories of other incomes are: 1) Interest earnings; 2) Stock dividends; 3) Incomes from professional practices; 4) Rental incomes, 5) The portion of year-end bonuses exceeding four months of salary; and 6) Non-insured salary incomes, such as transportation allowances from companies the policyholder does not work for. These premium payments in total are expected to add an additional NT$ 20 billion to the NHI program revenues.

Monthly premium payments for people whose main income comes from insured monthly salaries will go down slightly after the new NHI program comes into force, but people receiving extra incomes from large bonuses or stock dividends will be required to pay higher premiums.

The most significant change in the second-generation NHI reform program is the inclusion of the “supplementary premium payments.” Therefore, monthly premium payments in the future will be much higher than the current ones for employers who insure low salaries for highly-paid employees, wage earners who have moon-lighting incomes, people receiving high sales commissions, and professionals, such as lawyers, accountants and entertainers, who receive performance payments.

The new NHI program will also make it more difficult for citizens currently living abroad to join or rejoin the NHI program. If they want to enjoy NHI coverage, they must either have records of paying premiums within the last two years, or establish residency in the ROC six months prior to participating in the program.

An official from the Department of Health stated that the current NHI program could be sustained until March 2012 and the Health Department hoped that it would have at least one and a half years for follow-up preparations. Therefore, the second-generation NHI program was expected to come into effect by July 2012, the same official added.

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