Korean universal health care

Universal health care is a basic human right that is part of the social compact. The government that fails to provide this is in serious violation of its obligations to its citizens.

Providing proper health care is important for a country’s economic development. People who are less than healthy and with neglected chronic conditions cannot be productive and can even be a burden.

I was covering the Senate when then senator Freddie Webb sponsored the first iteration of our universal health care law. I was skeptical but hopeful. That was back in 1995. It has been amended and supposedly improved twice.

Unfortunately, our officials do not take the program seriously. Then Finance secretary Ralph Recto took its supposedly “excess” funds to fill the fiscal gap created by corruption-laden ghost public works projects of powerful congressmen and senators.

The act of taking “excess” funds invalidates the favorite excuse that there are not enough funds to provide universal health care. And they have not appointed competent officials who can implement the program properly.

Hospitals, doctors and patients all hate the cumbersome and useless system that does not provide real help in time of need. The middle class that supports PhilHealth with salary deductions is particularly aggrieved.

Now, Executive Secretary Recto sees a two-tier PhilHealth system: one providing more services for paying members and the other for those too poor to contribute. This violates the constitutional intention envisioning a single universal health coverage built on social solidarity — where the healthy subsidize the sick, and those who earn more subsidize those who earn less, with the government filling the gap.

It has been 31 years and we are nowhere near a PhilHealth system that takes care of every Filipino. What we have is a system that doesn’t work and is plagued with corruption.

The other day, I came across a video of an American doctor saying that it only took South Korea 12 years to get every citizen (and resident aliens) covered by its health care system. No one is left out.

It is funded by a combination of employee contributions, government subsidies and tobacco surcharges. On average, workers see five percent of their pay deducted from their monthly salaries to support the health care system. Employees and employers share this burden.

For self-employed individuals, their contribution rate is based on both income and family size. This holds for both citizens and foreign residents.

Low-income people are exempt from contributing but are still offered medical insurance through the Medical Aid Program. The central and local governments jointly run this social welfare program.

Our doctors and hospitals will say this is socialized medicine that they dislike but they are wrong. Korea continues to rely on a fee-for-service system like ours, using private doctors and hospitals. The government is just the insurer in a one-payer system through the National Health Insurance Service.

The result is that South Korea today has one of the lowest health expenditures among OECD countries but still provides some of the best health care in the world.

The World Bank has praised South Korea for transitioning from a lower-income country with limited public health services to one with a nationally integrated insurance system that emphasizes broad coverage, cost control and technology-enabled oversight.

Korea definitely offers useful lessons for us.

Korea’s secret, the World Bank observed, is its meticulous attention to detail, from policy design to operational processes and implementation, with digital systems serving as the backbone of its service delivery and oversight.

Particularly noteworthy, the World Bank said, is Korea’s use of digital infrastructure to enhance transparency, streamline claims processing and support data-driven policy feedback. Implementing these systems required persistent effort and continuous adaptation.

Korea’s digital infrastructure stands out as one of its greatest strengths. The ability to collect, analyze and act on real-time data has enabled responsive policymaking, efficient service delivery and system-wide transparency, the World Bank observed.

Korea uses digital tools such as AI-powered fraud detection, real-time claims tracking and health data analytics to support policy and operational decisions. These technologies are not standalone solutions — they are embedded within broader governance structures with clear mandates and feedback loops.

Indeed, integrating digital innovation into national priorities can enhance service delivery and public trust.

The last we heard about PhilHealth modernizing its information system was in relation to a corruption scandal in 2020.

An internal whistle-blower exposed an attempt to purchase “overpriced” hardware and software — including network switches allegedly marked up by thousands of percent. Some P2.1 billion was earmarked for PhilHealth’s IT modernization budget. No one has faced charges at the Sandiganbayan.

PhilHealth’s irrelevance is starkly shown by its ridiculously low reimbursement rate. PIDS, the government economic think tank, reports that between 2014 and 2023, hospital inpatient service costs rose by an average of 3.4 percent annually, causing the real value of PhilHealth’s payments to decline by about 40 percent over the decade.

The PIDS authors pointed out that this has made it more difficult for hospitals, especially public and provincial ones, to cover operating costs while keeping services affordable for patients.

According to the PIDS study, about 98.8 percent of hospital claims now exceed the case rate, leaving hospitals to absorb the shortfall or pass some costs on to patients. Out-of-pocket payments still comprise about 44 percent of total health spending, which shows that Filipinos remain financially vulnerable even with PhilHealth coverage.

We will discuss more of PIDS’ findings and suggestions on how to upgrade the quality of PhilHealth services in a future column.

We should ask the Korean government to help us design and implement a true universal health care system using their experience. PhilHealth is a fake.

Korean assistance can be an ODA project much like how the Koreans helped us build airports in Puerto Princesa and Laguindingan and the Jalaur Dam in Iloilo.

With the help of South Korea, we do not have to reinvent the wheel. They have done it successfully too.

Boo Chanco’s email address is [email protected]. Follow him on X @boochanco