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Health Financing in Taiwan

last updated Sep 27, 2011

Overview

Implementing organization: 
Department of Health
Legal Status: 
Year Launched: 
1995
Stage: 
Existing/expansion stage
Income Level of Target Population: 
All income levels

Funding

Primary Source of Funding: 
Government
Summary: 

Taiwan’s health system reform in 1995 instituted a government-run, mandatory, single payer system. The government created National Health Insurance to expand the breadth of coverage, provide quality, efficient medical services, and contain costs. By 2001, 99% of the population was enrolled and had access to care. All citizens, their dependents, foreigners with resident permits, and their dependents are covered. Private insurance is very small.

Key program components: 

The Department of Health sets policy and oversees the Bureau of National Health Insurance. The benefits package is comprehensive and includes inpatient services, outpatient services, dental services, traditional Chinese medicine, prescription drugs, diagnostics, treatment for the mentally ill, home health care, and some preventive health services. Beneficiaries pay premia to enroll, calculated on the basis of several variables.

Providers are primarily paid via global budgets and fee for service. For some conditions a resource-based relative value scale is used, and TW-DRGs are phasing in. Global budgets apply to dental care, traditional Chinese medicine, clinics, and hospitals.

Co-payments are required for most medical services and vary by service type, location of care, and whether the patient has a referral. Catastrophic diseases, child delivery, preventive health services, and medical services in select geographies do not require co-payments. Low-income families, children under 3 years, and veterans are exempt from co-payment.

Nearly all primary care providers are private, and 90% of them contract with the BNHI. Secondary and tertiary care is split between public and private hospitals. 32% of hospital beds and 15% of hospitals are public. Greater than 98% of all hospitals contract with the BNHI. No referrals are required to receive hospital medical services. Patients can visit any provider. Taiwan relies on a sophisticated information technology and smart card system to identify patients and track medical records. The smart cards store medical information related to prescriptions, diagnostics, routine treatments, catastrophic illnesses, organ donation, and palliative care.

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