Taiwan: Nearly Universal Health Insurance Coverage

Taiwan's National Health Insurance (NHI) system was introduced in 1995. It is a government-administered, single-payer, compulsory social insurance plan that promises equal access to healthcare for all citizens. By the end of 2004, population coverage had reached 99%. The NHI is mainly financed through premiums, which are based on payroll tax, and is supplemented with out-of-pocket payments and direct government funding. The NHI covers almost all services that can be provided by a health system, including dental care, traditional Chinese medicine, and preventive services.

How does Taiwan's insurance system work?

Taiwan's insurance system is a national health insurance (NHI) system, which was introduced in 1995. It is a single-payer, compulsory social insurance plan that centralises the disbursement of healthcare funds. The NHI is mainly financed through premiums, which are based on payroll tax, and supplemented by out-of-pocket payments and direct government funding.

Before the introduction of the NHI, there were several separate insurance schemes, including labour insurance, government employee insurance, and farmers' health insurance, which covered around 57% of the population. The NHI consolidated all these small insurance schemes into a single national insurance system, with the goal of improving efficiency and social justice by increasing healthcare coverage.

The NHI is a government-run social insurance scheme, governed by the Ministry of Health and Welfare (MOHW). It is mandatory for all citizens in Taiwan to join the NHI, except for prisoners or those who have moved out of the country. The coverage rate is around 99%. The NHI is funded through premiums, which are calculated based on an individual's job and income. The percentage of the premium paid by the insured varies from 0% for low-income citizens to 100% for the self-employed. The government provides premium subsidies for low-income households, civil servants, and others.

The NHI covers a wide range of services, including inpatient and outpatient care, dental care, traditional Chinese medicine, physical rehabilitation, chronic mental health care, and preventive care. There are no restrictions on patients seeking medical care, and they can choose any doctor or hospital without a referral. The NHI has led to increased healthcare accessibility, shorter waiting times, and lower costs for Taiwanese citizens.

How much does insurance cost?

The Taiwanese national health insurance system, or NHI, is a single-payer compulsory social insurance plan. It was introduced in 1995 and is financed through premiums based on payroll tax, supplemented by out-of-pocket payments and direct government funding. The percentage of the premium paid by the insured varies from 0% for low-income citizens to 100% for the self-employed. The percentage of revenue from the government and insured/employers was 23.2% and 76.8% in 2008, respectively.

Every service is accompanied by a co-payment, which varies depending on the institution. For example, co-payments range from £6.37 in hospital medical centres to £1.09 in GP clinics. Those who cannot afford co-payments receive public assistance.

Under the NHI model, citizens are free to choose hospitals and physicians without using a gatekeeper, and there are no waiting lists. Co-payments for regular office visits can be as low as US$5 per visit and are fixed, not dependent on the person's income.

NHI covers almost all services that can be provided by a health system, including dental care, traditional Chinese medicine, prescription drugs, and home nurse visits.

Private health insurance is also available in Taiwan, offered by private for-profit insurers. These policies do not cover medical services already covered by NHI but instead offer disease-specific cash indemnity provisions.

Who is eligible for insurance?

Who is eligible for insurance in Taiwan?

Taiwan's healthcare system has been ranked as one of the best in the world. The country has a compulsory social insurance scheme, the National Health Insurance (NHI) program, which all Taiwanese citizens with official residency must enrol in. Foreign nationals living in Taiwan with an Alien Resident Certificate (ARC) must also enrol in the program, regardless of age, gender, or employment status. International students who hold an ARC and stay in Taiwan for at least four consecutive months are also required to enrol in the NHI.

Any Taiwanese citizen whose household is registered in Taiwan must enrol in the NHI program when their six-month residency has been established. Those who are employed in Taiwan are not subject to the six-month wait. Babies with Taiwanese citizenship are enrolled in the program from the day they are born. The NHI program classifies the insured into six categories depending on their employment status.

Foreign residents who hold a Resident Certificate in Taiwan may apply for National Health Insurance after a full six months of residence. However, those who become legally employed may apply for NHI on the date of employment. From 1 December 2017 onwards, a newborn foreign infant who obtains a Resident Certificate in Taiwan will be eligible for NHI upon the date of birth. Foreign special professionals and foreign senior professionals who meet the criteria for being insured as employers or self-employed business owners may apply for NHI immediately upon receipt of their Resident Certificates. This policy extends to their dependents (spouses, minor children, and adult children who are unable to live independently) who have obtained their own Resident Certificate(s).

If you are a foreigner planning to live in Taiwan, the first step is to obtain an ARC. This will require you to undergo a health check, either in your home country or in Taiwan. Once you have your ARC, you will be able to apply for an NHI card, which will allow you to access affordable healthcare services during your stay in Taiwan.

What does insurance cover?

Taiwan's National Health Insurance (NHI) is a single-payer compulsory social insurance plan that covers almost all services that can be provided by a health system. The NHI covers:

• Inpatient and outpatient care (both primary and specialty care)
• Dental care (excluding orthodontics and prosthodontics)
• Traditional Chinese medicine
• Physical rehabilitation
• Chronic mental health care
• Preventive care, including adult health checkups, cancer screenings, baby and child health care checkups, and childhood immunizations through age 6
• Renal dialysis
• Prescription drugs

The NHI does not cover eyeglasses or visual acuity tests, or durable medical equipment such as wheelchairs and hearing aids. However, it does cover costly cochlear implants for children.

The NHI covers almost all health services, from dental care to parturition, from Western medicine to traditional Chinese medicine, and from preventive services to elderly home care. The NHI is described as providing "cheap and abundant care".

The NHI covers all citizens in Taiwan, and the population coverage had reached 99% by the end of 2004. Foreign nationals with legal residence in Taiwan may also join NHI through their employers.

How does Taiwan's insurance system compare to other countries?

Taiwan's healthcare system, known as National Health Insurance (NHI), is a single-payer compulsory social insurance plan that centralises the disbursement of healthcare funds. It was instituted in 1995 and is administered by the Ministry of Health and Welfare of the Executive Yuan. The NHI is mainly financed through premiums, which are based on payroll tax, and is supplemented with out-of-pocket payments and direct government funding. The system promises equal access to healthcare for all citizens, and by the end of 2004, population coverage had reached 99%.

Compared to other countries, Taiwan's insurance system has some notable differences. Firstly, it has one of the lowest administration costs in the world, typically under 2% of total healthcare spending. This is due to the single-payer system, which simplifies governance and keeps costs low. Secondly, Taiwan's NHI provides universal coverage, with mandatory enrolment for all citizens and foreigners legally residing in Taiwan for more than six months. This is in contrast to other countries where healthcare coverage may be optional or restricted to certain groups. Thirdly, the NHI offers a comprehensive benefit package that covers a wide range of services, including preventive medical services, prescription drugs, dental services, and traditional Chinese medicine. This level of coverage is not always available in other countries, where insurance plans may have more limitations and exclusions.

In terms of cost, the NHI has helped to control healthcare spending in Taiwan. Before the implementation of the NHI, Taiwan spent around 4.7-4.8% of its GDP on healthcare. After the introduction of the NHI, spending increased to 5.39% in the following year and has remained relatively stable since then. This is lower than the average health spending of OECD countries, which was 9.3% of GDP in 2012.

Another key difference is the use of a global budget system, which caps total NHI expenditure. This gives the Taiwanese government greater control over costs compared to other countries where healthcare spending may not be as tightly regulated. The global budget system also contributes to the NHI's cost-effectiveness, with Taiwan's system outperforming the US system, which spends a higher percentage of its GDP on healthcare while leaving a significant portion of its population uninsured.

However, there are also some challenges and areas for improvement in Taiwan's insurance system. One issue is the low doctor-to-patient ratio, which can result in short consultation times and long waiting times for patients. Additionally, there is a weak gatekeeping system, which means patients can freely choose their healthcare providers without a referral. This can lead to overcrowding in larger hospitals and may impact the quality of care.

In summary, Taiwan's insurance system compares favourably to other countries in terms of cost, coverage, and accessibility. However, there are also some challenges, particularly regarding the availability of healthcare providers and the need for better gatekeeping.

Frequently asked questions