Construction of Korean Health Accounts Construction of Korean Health Accounts

and and

of Tables Cross-classifying Expenditure of Tables Cross-classifying Expenditure

by financing agents, providers and by financing agents, providers and

functionsfunctions

Hyoung-Sun JEONG, Ph.D.Hyoung-Sun JEONG, Ph.D.

Department of Health AdministrationDepartment of Health Administration

Yonsei UniversityYonsei University

Hyoung-Sun JEONG, Ph.D.Hyoung-Sun JEONG, Ph.D.

Department of Health AdministrationDepartment of Health Administration

Yonsei UniversityYonsei University

CONTENTSCONTENTSCONTENTSCONTENTS

KOREAN NATIONAL HEALTH ACCOUNTSKOREAN NATIONAL HEALTH ACCOUNTS1

CONSTRUCTING PROCESSCONSTRUCTING PROCESS2

RESULTS AND POLICY IMPLICATIONSRESULTS AND POLICY IMPLICATIONS 3

CONCLUSIONCONCLUSION 4

KOREAN NATIONAL HEALTH KOREAN NATIONAL HEALTH ACCOUNTSACCOUNTSKOREAN NATIONAL HEALTH KOREAN NATIONAL HEALTH ACCOUNTSACCOUNTS

With the new accounts by the OECD SHA,With the new accounts by the OECD SHA,it is now possible to better compare total health expenditure of Korea with other OECD countries andGDP share of total health expenditure in the OECD Health Data is currently the most frequently quoted figure on health expenditure in Korea

Before the OECD SHA is adopted,Before the OECD SHA is adopted,considerable differences emerged in both methods (different health expenditure items) and results (total amount different by over 30%) among independent estimates of total health expenditure produced by several researchers

Constructing of a set of health expenditure tables Constructing of a set of health expenditure tables that follow the framework of the OECD manual “A that follow the framework of the OECD manual “A System of Health Accounts (SHA)”System of Health Accounts (SHA)”

Until last year, Ministry of Health and Welfare (MOHW) commissioned Korean Institute for Health and Social Affairs (KIHASA) to produce Total Health Expenditure. Thus, produced were tables cross-classifying expenditure both by financing agents and by functions (sources-to-uses matrix).

This year, MOHW commissioned Yonsei University to construct health accounts including classification by providers additionally. The figures presented here are its interim results, whose completion would be submitted for OECD Health Data 2004. (sources-to-providers and providers-to-uses matrices as well as sources-to-uses matrix)

CONSTRUCTING CONSTRUCTING PROCESSPROCESSCONSTRUCTING CONSTRUCTING PROCESSPROCESS Explanation of the Whole ProcessExplanation of the Whole Process New estimations depends on the Health and Nutrition New estimations depends on the Health and Nutrition

Survey in terms of Private Health ExpenditureSurvey in terms of Private Health ExpenditureThe survey has been periodically performed through interviews with about 40,000 persons sampled from all over the country. The survey includes many items on medical use, such as name of disease, health care providers, number of visits, money paid out-of-pocket, etc.

Health expenditure is not well classified according to Health expenditure is not well classified according to function such as curative-rehabilitative care, long-function such as curative-rehabilitative care, long-term care and ancillary servicesterm care and ancillary services

Long-term care facilities are not yet popular in Korea.

RESULTS AND POLICY RESULTS AND POLICY IMPLICATIONSIMPLICATIONS RESULTS AND POLICY RESULTS AND POLICY IMPLICATIONSIMPLICATIONS

Health expenditure is below the level expected Health expenditure is below the level expected for a country with Korea’s incomefor a country with Korea’s income

Low level of health expenditure is due, at least in part, to the high level of out-of-pocket payments (one of the highest in the OECD area)

Can this be interpreted as showing that Korean government or consumers have attached lower priority to health care than have those in other OECD countries?

Public funding sharePublic funding share has been increasing most has been increasing most quickly, but is still one of the lowest among OECD quickly, but is still one of the lowest among OECD countriescountries

Korea has rapidly approached the “OECD norm”, but is still facing equity issue by leaving more medical services uncovered by health insurance and putting a higher co-payment burden on the peopleHowever, particularly after the reform for the separation between prescribing and dispensing of drugs in 2000, the public funding share has much increased.

Korea has an unusual mix of health expenditure by Korea has an unusual mix of health expenditure by mode of production, compared with other OECD mode of production, compared with other OECD countriescountries

Very low in-patient share (23.4%), considerably high out-patient share (41.2%) and high drug share (20.3%) of total health expenditure in 2001.

CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION

New estimation supported by the Ministry has New estimation supported by the Ministry has added new tables including providers’ aspects, added new tables including providers’ aspects,

which are expected to be a paramount contribution for evidence-based health policy in Korea as well as for the construction of Korean health account itself.

Further developments to be made for the Further developments to be made for the KOREAN NHAKOREAN NHA

Linking of existing tables on expenditure by broad disease categories and age & gender to NHA tables