South Korea will seek a legal base to pressure private insurers to cut down premiums of their medical indemnity insurance to help alleviate the cost burden on subscribers amid coverage expansion of national health insurance, according to a presidential policy panel on Wednesday.

The State Affairs Planning Advisory Committee announced that a legislation will be introduced within this year to justify the alignment between public and private health insurance plans to reduce expensive medical indemnity insurance premiums. The panel believes private insurers are benefiting from decreased policy payment to subscribers as the government has expanded coverage of the universal health insurance scheme.

Residents in South Korea are required to subscribe to the national health insurance program but have bought medical indemnity insurance plans from private insurers to be paid for medical treatment and hospitality costs not reimbursed by the mandatory insurance scheme.

The insurance industry immediately protested the plan, saying that the idea is one-sided and not based on the realty where not a few subscribers abuse their medical indemnity insurance and cause a deficit to insurers.

Park Kwang-on, the committee spokesman, said a consultative body for public and private insurance schemes will soon be formed for discussion, while data on medical indemnity insurance and non-reimbursement items of the national health insurance will be provided and benefits of private insurers from coverage expansion of the national health insurance will be statistically validated.

The government will provide statistical grounds on which private insurers can lower their medical indemnity insurance premiums and induce them to cut down their premiums by the first half of next year, the spokesman said.

Insurance companies which massively raised medical indemnity insurance premiums in the past two years need to adjust their premium increase, Park added.

By Kim Tae-sung and Kim Gyu-sik

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]