North Korea is planning to transition from its nominally free healthcare system to a medical insurance model. The regime has assigned the task of rebuilding the healthcare system to the Cabinet’s Health Ministry and Workers’ Party departments. The new system will require employees at various agencies and enterprises to enroll in medical insurance, with premiums deducted from their monthly wages. The regime is also considering allowing North Koreans without an official workplace to receive insurance benefits through working family members who are insured.
The introduction of medical insurance represents a shift from the state covering the entirety of medical expenses to a system in which costs are split with individuals. People enrolled in basic insurance will receive basic treatment at prices set by the state, but out-of-pocket costs may increase for hospitalization or specialized treatment. The regime is also planning to issue “social security medical insurance cards” to manage individuals’ medical history and treatment records.
The adoption of medical insurance is seen as a way to stabilize medical expenses and address the operational difficulties faced by new hospitals and pharmacies. The regime has concluded that the current system is not viable and has decided to introduce medical health insurance to address these challenges. The introduction of medical insurance may be connected to the vision of a “public health revolution” announced by North Korean leader Kim Jong Un.
The key variables in the new system will be the level of insurance premiums and the level of out-of-pocket spending for treatment and medication. The regime has not yet made concrete decisions on these matters, and struggling households and those without an official job may be skeptical about the introduction of medical insurance. Despite the introduction of medical insurance, the regime is expected to continue to espouse the socialist vision of free care, even as the country moves to a system of managed public health care based on medical insurance.
The use of medical insurance cards will enable the medical authorities to track treatment and integrate medical records at all levels, from neighborhood clinics to top-tier hospitals. This will give the authorities a top-down view of who has been treated, what treatment they’ve received, and where they got it. The introduction of medical insurance is a significant development in North Korea’s healthcare system, and its impact will depend on the details of the new system and how it is implemented.