South Korea’s National Health Insurance Service (NHIS) will begin forcibly deducting unpaid health insurance premiums from benefits received through the country’s self-pay limit system, a move impacting individuals who have fallen behind on contributions. The policy, set to take effect this year, aims to address a growing issue of unpaid premiums and ensure the sustainability of the national healthcare system.
The self-pay limit system, known as boninbudam sanghanje (본인부담상한제), caps the amount of out-of-pocket healthcare expenses an individual must pay annually. Once a patient’s annual medical costs exceed a predetermined limit – varying based on income level – the NHIS covers the remaining expenses. According to the NHIS, the system is designed to alleviate the financial burden of medical costs for citizens. For 2025, the upper limits range from 1,410,000 won to 10,740,000 won, depending on income bracket and hospital type, as detailed in recent reports.
Yet, the new policy stipulates that any refunds issued under the self-pay limit system will first be used to offset outstanding health insurance premiums. This means individuals with significant unpaid premiums may receive a reduced refund, or no refund at all, even if their medical expenses surpass the annual limit. The NHIS has not publicly disclosed the total amount of outstanding premiums, but officials have indicated the issue has become increasingly problematic.
The income-based upper limits for 2025 are structured as follows: for the lowest income bracket (insurance premium of 56,330 won or less), the limit is 1,410,000 won. This rises incrementally with income, reaching 10,740,000 won for those with premiums exceeding 265,901 won. These limits apply to general hospitalizations, with an additional provision for extended stays in nursing hospitals exceeding 120 days.
The NHIS has clarified that the system applies to both direct beneficiaries and dependents covered under a family plan. The coverage extends to healthcare services covered by national health insurance, excluding non-covered items such as cosmetic surgery, certain dental procedures, and private hospital room charges. The refund mechanism operates through either a pre-payment system, where the hospital directly deducts the refundable amount, or a post-payment system, where the individual applies for a refund from the NHIS.
Critics of the policy argue that it disproportionately affects low-income individuals who may struggle to pay their premiums due to financial hardship. While the self-pay limit system is intended to provide financial relief, the simultaneous deduction of unpaid premiums could negate those benefits for vulnerable populations. The NHIS has not yet responded to these concerns with a detailed plan for addressing potential hardship cases.
The NHIS has announced that detailed information regarding the application process and eligibility criteria for the self-pay limit system is available on its website. The agency has not specified a date for the full implementation of the premium deduction policy, but officials have indicated it will be rolled out in the coming months.
