The current Act prescribes that where a foreigner who does not fall under the employee satisfies certain requirements such as residing in Korea more than three months or being expcted to reside therein continuously during the relevant period, he/she may become the self-employed insured.

However, since there are growing numbers of foreigners who receive national health insurance benefits while residing in Korea for the purpose of getting a job or studying, their use of medical care also is significantly increasing every year, along with fraud cases among some foreigners. From 2013 to 2016, the number of foreigners having received medical benefits by fraudulent means totaled 166,834 cases, which represents 2.4 times that of locals who received insurance benefits by fraud (69,549 cases). Besides, the number of foreigners who acquired eligibility for national medical insurance but departed from Korea for the past 3 years after having received medical treatment only has reached 24,773.

Particularly in the case of self-employed insured foreigners, their average monthly medical expenses per capita (KRW110,300) are over two times higher than those of the insured foreign employee (KRW54,707), showing an increase of 6.4% for the past 5 years. Furthermore, the fiscal deficits run by the national health insurance due to self-employed insured foreigners reached KRW205 billion, which shows that the increased medical expenses caused by such foreigners are having a negative impact on the finances of the national health insurance program.

Accordingly, the Amendment aims to specify foreigners’ extended period of stay in Korea required to be eligible to be a self-emplyed insured from the current ‘over 3 months’ to more than 1 year; to apply a different amount of co-payment to be borne by a self-employed insured foreigner depending on his/her period of stay in Korea and on the severity of the disease; to require self-employed insured foreigners to prepay their insurance contributions a 3-month basis, thereby preventing moral hazards of such foreigners and enhancing financial soundness of health insurance.

Details

A. If a foreigner resides in Korea for more than 1 year and is expected to continue to reside in Korea for that period, and satisfies the requirements established by Ordinance of the Ministry of Health and Welfare, the foreigner may be eligible to be a self-employed insured (Article 109-3, subparagraph 1).

B. If a self-employed innsured foreigner resides in Korea for over 1 year but less than 1 year and 6 months, he/;she shall bear an amount equivalent to 10/100 of the co-payment borne by a local; if his/her resident period in Korea is more than 1 year and 6 months, the relevant foreigner shall additionally bear an amount equivalent to 5/100 of the co-payment borne by a local; if a foreigner is a severely disabled person publicly notified by the Minister of Health and Welfare, he/she shall bear an additional amount equivalent to 10/100 of the co-payment borne by a local (Article 109-7 newly inserted).

C. The insurance contribution of a self-employed insured foreigner residing in Korea shall be prepaid on 3-month basis as prescribed by Ordinance of Ministry of Health and Welfare (Article 109-9).

Extend foreigners’ period of stay in Korea required to be eligible to be a self-employed insured from the current ‘over 3 months’ to more than 1 year; apply differentially the foreigners’ co-payment to be borne by a self-employed insured foreigner depending on his/her period of stay in Korea and on the severity of the disease; require the self-emplyed insured foreigners to prepay their insurance contributions on a 3-month basis (Article 109)