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International Health Care System Profiles
Health System Features
Who is Covered
What is Covered
Health System Governance
Ensuring Quality of Care
Reducing Disparities
Integration and Coordination
Cost Containment
Health and System Statistics
Health Care Spending
Physician Capacity and Utilization
Hospital Spending, Utilization, and Capacity
Health Risk Factors
Safety Problems Among Older Adults
Care Coordination and Transitions
Health Care Quality Indicators
Avoidable Deaths
Overall Views of Health Care System
2015 Commonwealth Fund International Health Policy Survey of Primary Care Physicians
2016 Commonwealth Fund International Health Policy Survey of Adults
The Taiwan Health Care System
by Tsung-Mei Cheng, Princeton University
What is the role of government?
Article 157 of the constitution of Taiwan, Republic of China, calls for the national government to promote health maintenance and implement the public provision of health care for all citizens. That article is the constitutional platform for the National Health Insurance Act, passed by Taiwan's legislature in 1994.
The act stipulates that national health insurance is compulsory and that the government is to provide health care and medical services to the insured in case of illness, injury, and childbirth. It further stipulates that the government and contracted providers should regularly make public information on the quality of health care.
The National Health Insurance program (NHI) is administered by the National Health Insurance Administration (NHIA) under the Ministry of Health and Welfare (MoHW) through six regional offices supported by a health information infrastructure. Municipal and district governments may offer additional benefits for residents within their jurisdiction, such as subsidies for out-of-pocket costs for poor residents.
Who is covered and how is insurance financed?
Publicly financed health insurance: Enrollment in NHI is mandatory for all citizens and for foreigners residing in Taiwan for longer than six months. As of 2016, 99.9 percent of the population is enrolled.
The NHI is predominantly a premium-based social health insurance system. Sixty-eight percent of revenue is derived from payroll-based premiums; 27 percent from supplementary premiums levied on nonpayroll income (large bonuses, professional fees, wages from second and third jobs, and incomes from dividends, interests, rents); and 5 percent from tobacco tax and lottery gains.1 Government accounts for 23.3 percent of payroll-based premiums; households account for 38.2 percent; and employers account for 38.6 percent.2 In 2016, rates for payroll-based and supplementary premiums are 4.69 percent and 1.91 percent, respectively.3
During most of the period 1998 to 2010, NHI expenditures nearly always exceeded revenues. However, by raising the premium rate from 4.55 percent to 5.17 percent of payroll income in 20104—the second increase in its then 15-year history—the NHIA began to accumulate surpluses starting in 2012.
Premium contributions are calculated on a per capita basis but are limited to a maximum of four members per household (the insured plus three dependents). Any additional members are covered for free. Premiums are paid monthly, with nearly all Taiwanese paying their premiums on time.5
Private health insurance: Private health insurance consists of disease-specific cash indemnity policies. Patients can use the cash for private hospital rooms or products, such as drug-eluting stents, not covered by the NHI. Private policies do not cover medical services covered by the NHI, nor do they buy faster access to specialists, diagnostic tests, or choice of specialists. As a component of total health expenditures, however, private coverage is growing, although the exact extent is unknown.
What is covered?
Services: NHI benefits are uniform and comprehensive. They include inpatient and outpatient care (both primary and specialist care), prescription drugs, dental care (excluding orthodontics and prosthodontics), traditional Chinese medicine, child birth care, physical rehabilitation, home care, chronic mental health care, and end-of-life care.
The NHIA determines which services are covered in consultation with a broad spectrum of stakeholders. Coverage decisions are subject to considerations of their budget impact (see below).
Cost-sharing and out-of-pocket spending: The NHIA mandates copayments for physician visits and prescription drugs, and coinsurance for inpatient care, subject to limits and exemptions (discussed below). Copayments for care obtained without referral are higher. Copayments range from NTD80 (USD2.58) to NTD360 (USD12), depending on the level of the hospital visited.
Coinsurance for inpatient care varies by length of stay and type of bed (acute or chronic). For example, the coinsurance rate for an inpatient stay shorter than 30 days is 5 percent for chronic beds and 10 percent for acute beds.6 In 2015, the coinsurance limit for an episode of care was USD1,063 (NTD33,000) and USD1,803 (NTD56,000) for an inpatient stay for the same illness or condition.7
In 2014, out-of-pocket health care spending, as officially reported, accounted for 34.7 percent of total national health expenditures.8 However, this overstates what the Organisation for Economic Co-operation and Development (OECD) counts as out-of-pocket spending, as Taiwan includes spending on items not included in OECD data, such as infant formula, baby diapers, dietary supplements, health foods, Chinese herbal medicine, private hospital rooms, cosmetic surgery, and high-tech surgical procedures. According to a former NHIA administrator, out-of-pocket spending associated with necessary health care, including medical care, dental care, and prescription drugs, amounted to 12.1 percent of Taiwan's national health expenditures in 2012, a figure more in line with the OECD norm.9
Safety nets: The NHI provides a generous safety net for disadvantaged populations, including the very sick, that ensures access to needed services. Outpatient copayments for people with physical or mental disability are limited to NTD50 (USD1.671). Copayments are also reduced for elderly adults with chronic disease who are enrolled in the Hospital Patient-Centered Integrated Care Plan (discussed below). In addition, copayment exemptions apply to childbirth and 30 catastrophic diseases and conditions, as well as to residents of remote and mountainous areas and offshore islands, veterans, families of diseased veterans, low-income households, children under age 3, tuberculosis patients, and others.10 Since 2013, for residents of underresourced areas, copayments were reduced by 20 percent, and copayments for home care were halved, from 10 percent to 5 percent for residents of underserved areas and for those who have difficulty traveling to providers for care.11
Those living in remote and mountainous areas and off-shore islands also have access to needed services through the Integrated Delivery System.
The NHIA also provides insurance premium subsidies. For example, it pays 100 percent of premiums for low-income households, military personnel, veterans, civil servants (including public school teachers), and convicts; 70 percent for dependents of veterans and members of farmer, fishermen, and irrigation associations; and 35 percent for private school teachers.
Finally, to protect the right to care of people with MoHW-recognized rare diseases, the NHIA waives copayments for all drugs necessary to keep them alive.
How is the delivery system organized and financed?
Primary care: Approximately 40 percent of Taiwan's physicians practice in their own private clinics. From 80 percent to 90 percent of clinics are solo practices; the remainder are group practices.12 Nearly all private clinics (98%) contract with the NHIA to deliver services.
Only about 5 percent of all clinic doctors have received formal training in family medicine.13 The rest are specialists. In recent years, there has been a trend toward multispecialty group practices.
There is no requirement to register with a primary care physician, making care coordination difficult. Utilization of physician services has been high: the average number of office visits per person per year was 12.6 in 2012, significantly higher than the median for OECD countries (6.3), though lower than Korea (14.3) and Japan (12.9).14
Physicians are paid predominantly on a fee-for-service basis, according to national uniform fee schedules set by the NHIA, with stakeholder inputs, under the primary care global budget. To maximize their revenue, physicians compete fiercely for patients, although not on price. Pay-for-performance and capitation-based payment are currently being tried on a pilot basis.
Other sources of physician income are patient registration fees paid at the time of visit, services and goods not covered by the NHI, and copayments.
For most of NHI's history, no balance billing was permitted for either physician or hospital services. In recent years, however, the NHIA has made exceptions for six medical devices (intraocular lens implants, drug-eluting and bioactive stents, artificial ceramic knee joints, metal-on-metal artificial hip joints, bioprosthetic heart valves, and programmable ventriculoperitonneal shunts); patients opting for these devices pay the difference between the NHI fees and the actual price charged.15
Outpatient specialist care: Patients in Taiwan also have free choice of hospital-based specialists on an outpatient basis, with or without referrals. This has led to overcrowding in hospital outpatient departments, especially at large hospitals and major medical centers. To discourage people from doctor- and hospital-shopping or from accessing tertiary care without referral, the NHIA in recent years established graduated patient registration fee and copayment schedules, whereby patients without referrals pay higher fees and copays.
Hospital-based physicians, including outpatient specialists, are salaried employees. They are eligible for bonuses pegged to productivity—volume of services delivered, papers published, and public lectures given, among other activities.
After-hours care: There are no formal after-hours care provisions. Although the hospital association and the NHIA have an agreement to provide telephone consultation after hours, the future of the arrangement is uncertain, as physician associations mandate that doctors must "rest" on weekends.16 Telephone consultation is, however, available 24 hours for the 2.5 million people (10.6% of the population) who are enrolled in the Family Physicians Integrated Care Plan.17
That said, lack of after-hours care is not viewed as a serious problem. Many physician clinics are open until 9:00 p.m. and on Saturdays. Outside these hours, patients visit one of Taiwan's more than 400 hospital emergency departments, where access is generally considered convenient and affordable.18 In recent years, however, emergency departments have experienced increasing traffic.19
Hospitals: As of 2014, of the 486 hospitals for Western medicine in Taiwan, 454 are accredited (93.4%), including 78 of 80 public hospitals and 376 of 406 private hospitals.20 All accredited hospitals contract with the NHIA to deliver services, with contracts renewed on three-year intervals upon passing evaluation. By law, hospitals are nonprofit. Hospitals in Taiwan have a closed-staff structure: once patients are admitted, on-staff physicians assume responsibility for their care. Hospital-based physicians see patients in the hospital on both an inpatient and outpatient basis.
Hospitals in Taiwan provide both inpatient and outpatient services and derive revenues from a nationwide global hospital budget set by the NHIA (unlike in many other countries, where hospitals receive individual global budgets for operations). That overall national budget is divided into six regional budgets administered by the NHIA's six regional offices. Under this arrangement, competition for revenues is intense among the hospitals in each region.
Hospitals are paid based on diagnosis-related groups (DRGs) as well as on uniform national fee schedules set by the NHIA with input from stakeholders. As of 2016, there were 401 DRGs, which accounted for 22 percent of all hospital payments. When fully implemented, the battery of 1,062 DRGs will account for 60 percent of total hospital expenditures.21
Hospitals also derive revenues from non-NHI-covered services and goods, copayments for outpatient visits and coinsurance for inpatient services, and registration fees collected at the time of service.
Access to care has been generally convenient: 85 percent of patients reach a hospital or clinic in less than 30 minutes, and 83 percent of patients wait 30 minutes or less before being seen by a doctor. There are essentially no waiting lines.22
Mental health care: Mental health services are a covered benefit. As of 2014, Taiwan had 32 acute mental health beds and 59 chronic mental health beds per 100,000 population, respectively.23 These represent a 21 percent increase in mental health beds between 2003, when there was an acute shortage, and 2013.24,25
NHI also covers mental health services on an ambulatory basis, at either private clinics or hospital outpatient mental health departments, as well as day care for patients with mental illness.
Long-term care and social supports: Taiwan did not yet have a formal long-term care (LTC) program as of 2016 but needs one urgently to meet the growing needs of a rapidly aging population. As of 2016, 13.2 percent of Taiwan's population was age 65 or over, a percentage expected to increase to 24.1 percent by 2030 and 36.9 percent by 2050.26 Moreover, the number of people with disabilities reached 3.45 percent of the population in 2016 and continues to grow.
The previous government had hoped to implement an LTC system by 2016, but this did not happen. With the change in government in May 2016, there are unresolved issues related to LTC financing, benefits, eligibility, staffing, and workforce. For example, the current government abandoned the previous administration's decision to finance LTC via premiums, instead opting for tax-based system of financing. In September 2016, the premier's office passed the "Long-Term Care Ten-Year Plan 2.0" to promote capacity building and widespread distribution of LTC resources, with the principle objective of establishing an integrated, comprehensive community-based LTC system. As of the end of 2016, LTC in Taiwan remains a work in progress. Lack of LTC workforce, inadequate facilities, service fragmentation, and quality control remain major challenges.
Meanwhile, through its new integrated home care program, the NHI provides home care for the elderly and disabled, including visits by physicians and nurses, community services, and end-of-life care. In the Economist Intelligence Unit's 2015 "quality of death" rankings of 80 countries, Taiwan came in sixth, and first in Asia.27 (The top 10 countries in 2015 were: the United Kingdom, Australia, New Zealand, Ireland, Belgium, Taiwan, Germany, the Netherlands, the United States, and France.)
What are the key entities for health system governance?
As Taiwan has a single-payer health system, governance is fairly straightforward, with the MoHW responsible for policy and the NHIA for administration of health insurance coverage. NHIA tasks include premium collection, risk-pooling, and provider payment, as well as oversight of utilization, delivery, and quality of NHI services through a powerful information technology (IT) system.
One of the MoHW's most important tasks is to decide by how much the NHI global budget should grow each year. The process is as follows:
January–April: MoHW performs due diligence to come up with a proposed global budget growth rate for the next year.
April–May: MoHW sends to the Office of the Premier a proposed lower and upper ceiling for growth.
May–June: The National Development Council reviews the MoHW's proposal and determines a range for the growth rate and sends it back to the MoHW.
September–December: The MoHW's 35-member multistakeholder National Health Insurance Committee meets to negotiate the specific growth rate for each of the five sectoral global budgets—primary care, hospital, dental, traditional Chinese medicine, and renal dialysis. Once the NHI Committee reaches consensus, the minister approves a fixed growth rate and sends it to the NHIA for implementation.
Two other MoHW agencies also play a role in the NHI. The National Health Insurance Mediation Committee oversees claims disputes brought by providers and premium collection disputes brought by individuals and employers. The Department of Social Insurance, meanwhile, helps monitor the NHIA's operations and may make recommendations to the minister on cases referred to the ministry from the NHIA.
In addition to debating and negotiating with the government on new health legislations or their amendment, Parliament plays an important watchdog role regarding the NHI. For any premium rate increases beyond 6 percent, Parliament must pass an amendment to the NHI Act.
What are the major strategies to ensure quality of care?
Major MoHW quality-monitoring systems and the offices governing them include:
Hospital accreditation and patient safety (Department of Medical Affairs)
NHI program administration (National Health Insurance Administration)
Communicable disease control (Centers for Disease Control and Prevention)
Cancer prevention and control (Health Promotion Administration)
Major NHIA strategies to ensure quality of care fall into three broad categories:
Payment incentives: A number of programs have specific funding to improve quality, such as extra bonuses for serving patients in remote and mountainous areas or offshore islands (integrated delivery system [IDS] plans) and pay-for-performance schemes for management of chronic conditions, including asthma, diabetes, breast cancer, and schizophrenia.
Claims management and reviews: Because of the massive volume of claims submitted each day, the review process follows two tracks: a fully automated procedural review utilizing profile analysis based on specific medical criteria and a peer review of randomly selected claims.
Information-sharing and transparency: Public reporting systems targeting hospitals and pharmaceuticals (see discussion of PharmaCloud below) are in place to improve quality and reduce waste.
The NHIA has developed several hundred quality indicators, some intended for pay-for-performance schemes, some for calculating global budgets, and others for public disclosures and claims review.28 Many of these serve the dual purpose of improving quality and reducing costs. Important national programs for quality assurance and improvement include:
Integrated delivery system (IDS) plans (discussed earlier)
Pay-for-performance disease-management programs (discussed above)
Family Physicians Integrated Care Plan
Hospital Patient-Centered Integrated Care Plan for outpatients age 65 and older with two or more chronic conditions
Capitation Pilot Project
NHI PharmaCloud (see below)
My Health Bank (see below)
Post-Acute Care Pilot Project for stroke patients
Integrated Post-Acute Care program for burn patients
Artificial Joints Registry System to improve patient safety, reduce amenable mortality from unsafe artificial joints, and quality of care (launched in 2016).
Each July, the NHI Committee meets with scholars and experts to review and grade the five sectoral global budgets for their performance on service delivery, quality, public satisfaction, inappropriate use of resources, and other criteria. There are five grades: exceptional, excellent, good, fair, and bad (the last of which has never been assigned). Each sectoral global budget's funding allocation increase for the following year is based on the grade it receives—a 0.5 percent increase for exceptional, 0.3 percent for excellent, and so on.29
What is being done to reduce disparities?
Taiwan guarantees a right to health care. Everyone receives the same level of care based on the national uniform benefit package, regardless of ability to pay. More than 3 million economically disadvantaged Taiwanese (12.8% of the population) have full access to NHI services, owing to the NHIA's various financial and access assistance measures, including premium subsidies and copayment reductions or exemptions (discussed earlier). In recent years, the government has lowered the income threshold to allow more people to become eligible for these subsidies.
The NHIA also makes interest-free loans and installment plans available to those who cannot pay their premiums on time because they are temporarily unemployed or between jobs.
Other programs to ensure access to care and financial protection, such as IDS plans, are discussed elsewhere in this profile.
What is being done to promote delivery system integration and care coordination?
Improved delivery system integration and care coordination have been on the NHIA's agenda for many years. Many such initiatives are discussed earlier in this profile.
What is the status of electronic health records?
To make it convenient to access care, everyone in Taiwan carries an electronic NHI card with a unique personal health identifier. The card contains personal information, insurance data, the six most recent medical visits, diagnoses, drug prescriptions, drug allergies, major illnesses, organ donation consent, palliative care directives, and public health records (including immunizations). Providers are required to report to the NHIA, on a 24-hour basis, each patient visit and service delivered, thus enabling the tracking of individual and national aggregate service utilization in nearly real time. This provides the NHIA with a good sense of overall expenditures at any point in time and helps it identify and manage heavy users of NHI services. The card also helps the government identify and track public health threats and infectious disease outbreaks, as it did in the 2003 SARS epidemic.
The NHI card has made administration simpler and more efficient. NHIA administrative costs accounted for just 1.07 percent of total NHI expenditures in 2014.30
Two recent personal health information innovations, both IT-driven, are worthy of note. One is NHI PharmaCloud, a cloud-based, patient-centered drug information system that the NHIA introduced in 2013. Taking advantage of the vast database the NHIA has created since its inception, PharmaCloud enables doctors (during clinic and outpatient visits, house calls, and emergency department care) and pharmacists to know in real time a patient's medication history for the past three months. PharmaCloud also provides prescribers clinical and safe-use information to help prevent drug adverse reactions and reduce waste.
My Health Bank, introduced in 2014, is another cloud-based innovation that provides comprehensive health and medical records for any insured person upon request. Records can be updated at any time. In addition to increasing the transparency of important personal health information, the initiative is intended to assist patients in self-managing their health.
All hospitals and clinics use electronic patient medical records. However, owing to a lack of infrastructure investment, NHI systemwide interoperability does not yet exist and interhospital exchange of patient medical records is limited.31
How are costs contained?
Health spending in Taiwan as a percentage of GDP or per capita GDP has been consistently low compared to OECD countries, even though Taiwan's per capita GDP is higher than that of many OECD countries. Total national health expenditures in 2013 represented 5.9 percent of GDP (and 6.2% in 2014), compared to the OECD median of 8.8 percent (2013).32 Per capita health spending in Taiwan in 2015 was USD2,595, considerably lower than OECD countries with comparable per capita GDP.33
Cost containment had been a major policy goal of Taiwan's government since the late 1980s, when rates of annual health spending growth were in the double digits. Since the inception of the NHI in 1995, the NHIA has introduced a number of cost-containment strategies on both the supply and demand sides.
On the supply side, the NHI's global budget system has been the most powerful tool for cost containment. NHI expenditure growth rates in the early years following the NHI's implementation had been between 6 percent and 9 percent, significantly higher than NHI revenue growth rates. Between 1998 through 2003, the government phased in five sectoral global budgets: dental (1998), Chinese medicine (2000), primary care clinics (2001), hospitals (2002), and dialysis (2003).
Global budgets have had a significant impact on health spending growth. In the 2004–2015 period, national health expenditure growth was between 2.9 percent and 4.4 percent, or an annual average of 3.87 percent. Meanwhile, GDP growth during this same period ranged between ?1.4 percent and 8.9 percent, for an annual average of 3.61 percent.34
Other supply constraints included DRG payment for hospitals and annual drug price adjustments. The latter are based on comparing the actual transaction prices of drugs procured by providers, which providers must report to the NHIA in the fourth quarter of each year, to the NHI fee for the drug. Fee adjustments are made in the first quarter of the following year, according to a formula bringing the NHIA fee closer to the actual transaction prices of drugs.35
Capacity constraints in the delivery system also play a role in cost containment in Taiwan. The physician–population ratio in Taiwan was 1.8 per 1,000 population in 2012, lower than the OECD median of 3.1 per 1,000 population.36 The ratio of computed tomography (CT) scanners per million population in Taiwan is lower than that in many OECD countries; comparable to Canada and France and higher than that in the Netherlands. Taiwan also has fewer magnetic resonance imaging (MRI) machines than many other OECD nations, including Australia, the United States, Japan, and Korea. On the other hand, the acute-bed-to-population ratio in Taiwan, at 3.2 per 1,000 population, was somewhat higher than the OECD median of 3.0 and higher than the United States (2.5), the United Kingdom (2.3), and Canada (1.7).37
The NHIA's pharmaceutical benefit management initiative considers both clinical effectiveness and cost-effectiveness in coverage decisions. The initiative is in the process of building capacity for health technology assessment to evaluate medical services to help the NHIA make coverage decisions and improve quality.
The NHIA's automated IT-supported claims review checks for the overall appropriateness of claims. In addition, it randomly selects a small percentage of claims for individual professional review by clinical experts. These measures help the NHIA monitor utilization and costs on a real-time basis (providers are required to report to the NHIA all services delivered daily, by patient), detect fraud and abuse, and safeguard quality.
There are fewer demand-side constraints in Taiwan's NHI. They include graduated copayment and coinsurance schemes, whereby patients accessing tertiary care without referral pay higher copayment and coinsurance, and utilization monitoring. Ceilings and exemptions from copayments and coinsurance, however, protect access to care. Overall, government provisions to safeguard access to care has rendered patient cost-sharing largely an insignificant factor in cost-containment in Taiwan.
In the long run, however, NHI's generous copayment policy may prove to be unsustainable. Going forward, it may be necessary to institute means-testing for copayment exemptions, both as a cost-containment measure and "to prevent reverse income distribution from the middle class to the rich."38
Administrative costs in Taiwan are very low, as alluded to earlier in this profile. Its IT-driven single-payer system has been characterized by administrative simplicity and low overhead costs, ranging from 1.5 percent in 2005 to 1.07 percent in 2014.39
Eliminating low-value services from the benefit package (delisting), however, has been difficult, owing to political considerations.
What major innovations and reforms have been introduced?
Important innovations and reforms in Taiwan's single-payer health insurance system have been discussed in earlier sections. These include the global budget system, DRG payment for hospitals, pay-for-performance (P4P), NHI card, PharmaCloud, My Health Bank, and various initiatives aimed at quality improvement and cost containment.
A major reform meriting special attention is the Second-Generation NHI Reform, which imposed a supplementary premium on six nonpayroll sources of income: rents, interest, dividends, large bonuses, professional incomes, and income from second and third jobs. Implemented in 2013 at an initial rate of 2 percent and reduced to 1.91 percent in 2016, the supplementary premium broadened the premium base and put the NHI system on sound financial footing (it now has a large surplus). Moreover, the reform improved equity in financing: the previous payroll-based premium system had weighed most heavily on Taiwan's salaried class and thus favored the wealthy.
1National Health Insurance Administration, Ministry of Health and Welfare, Taiwan's National Health Insurance 2015–2016.
2Author's personal communication with official at the Planning Division, National Health Insurance Administration, Ministry of Health and Welfare, Nov. 1, 2016.
3National Health Insurance Administration, Ministry of Health and Welfare, 2015–2016 National Health Insurance Annual Report.
4Ibid.
8Ministry of Health and Welfare, The Statistics and Trends in Health and Welfare 2014.
9T.M. Cheng, "Reflections on the 20th Anniversary of Taiwan's Single-Payer National Health Insurance System," Health Affairs, March 2015 34(3):502–10.
10National Health Insurance Administration, Ministry of Health and Welfare, 2015–2016 National Health Insurance Annual Report.
12Author's personal communication with Cheng-hua Lee, Deputy Director-General, National Health Insurance Administration, Ministry of Health and Welfare, Oct. 22, 2016.
14Ministry of Health and Welfare, The Statistics and Trends in Health and Welfare 2014.
22T.M. Cheng, "Lessons from Taiwan's Universal National Health Insurance: A Conversation with Taiwan's Health Minister Ching-Chuan Yeh," Health Affairs, July–Aug. 2009 28(4):1035–44.
25T.M. Cheng, "Taiwan's New National Health Insurance Program: Genesis and Experience So Far," Health Affairs, May–June 2003 22(3):61–76.
26National Development Council, Republic of China Population Estimates 2014–2061.
27Data from The Economist Intelligence Unit 2015 Quality of Death Index. Cited in R.Y. Long et al., "Palliative Care in Taiwan: An International Perspective," National Health Insurance Quarterly, Oct. 2016.
28Author's personal communication with Pen-Jen Wang, Senior Executive Officer, Medical Review and Pharmaceutical Benefits Division, National Health Insurance Administration, Ministry of Health and Welfare, Oct. 26, 2016.
30Data from author's personal communication with a National Health Administration official. For more on the administrative costs of Taiwan's NHI, see T.M. Cheng, "Reflections on the 20th Anniversary of Taiwan's Single-Payer National Health Insurance System," Health Affairs, March 2015 34(3):502–10.
31Author's personal communication with Pen-Jen Wang, Senior Executive Officer, Medical Review and Pharmaceutical Benefits Division. National Health Insurance Administration, Ministry of Health and Welfare, Oct. 26, 2016.
33Data for Taiwan's per capita health spending from National Health Insurance Administration, Ministry of Health and Welfare. Data for OECD countries from OECD Health Statistics 2016.
34Author's calculation based on data from 2016 National Health Insurance Global Budget Payment Consultation Reference Index, National Health Insurance Committee, Ministry of Health and Welfare.
36Ministry of Health and Welfare, The Statistics and Trends in Health and Welfare 2014. OECD data based on OECD Health Data 2015.
38T.M. Cheng, Taiwan's Health Care System: The Next 20 Years (Brookings Institution, 2015); accessed Oct. 31, 2016.
39T.M. Cheng, "Reflections on the 20th Anniversary of Taiwan's Single-Payer National Health Insurance System," Health Affairs, March 2015 34(3):502–10.
Health System and Public/Private Insurance Role
Government Role
Single-payer, government-administered national health insurance system with mixed private-public, albeit predominantly private, delivery system. Government subsidies to the disadvantaged populations.
Public System Financing
Payroll-based premium; supplementary premium based on nonpayroll incomes, general tax revenue for premium subsidies, tobacco tax, and lottery gains.
Private Insurance Role
National health insurance provides comprehensive benefits including outpatient and inpatient care, drugs, dental, Chinese medicine, dialysis, rehabilitation, home nursing care, care for the mentally ill, etc. Private insurance plays at best a supplemental role. Main benefit is cash indemnity payments to policyholders to use as they see fit — for example, private rooms, coinsurance for inpatient stays. Private insurance plays no substitutive role to the public insurance system.
Provider Ownership
98% of clinics are private
Mixed public (16% of hospitals, 28% of beds) and private not-for-profit (84% of hospitals, 72% of beds)
Provider Payment
Primary Care Payment
Fee-for-service predominant, some pay-for-performance, and capitation pilot under primary care global budget
Hospital Payment
Fee-for-service, diagnosis-related groups, case payment under hospital global budget
Primary Care Role
Registration with GP Required
Gatekeeping
Benefit Design
Caps on cost-sharing
Caps apply to coinsurance for both episodic and annual inpatient stays. For 2015, cap on per episode of inpatient stay was NTD33,000 (USD1,022), and the annual cap was NTD56,000 (USD1,734).
Exemptions & Low-Income Protection
Premium exemptions apply to low-income households, active service military personnel and military school students on scholarships, widows of deceased military personnel on pensions, prison inmates, and veterans. Copayment and coinsurance exemptions apply to low-income patients and patients with any of 30 catastrophic diseases or conditions (for example, cancer, chronic mental disorders, rare diseases, congenital diseases, end-stage kidney disease, etc.).
Demographics and Health Risk Factors
Total population (millions of people), 2014
Percentage of population age 65 and older, 2014
Percentage of adults who report being daily smokers, 2014
Prevalence of obesity (BMI>30), 2014
Health System Statistics
Health care spending per capita, 2014
Out-of-pocket health care spending per capita, 2014
Number of practicing physicians per 1,000 population, 2014
Hospital spending per discharge, 2014
Primary care physicians' use of electronic medical records, 2015
Published by The Commonwealth Fund
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