The government will completely overhaul the basic pension system to provide more support for low-income seniors, adopting a 'lower support for higher income' structure. The current reduction system, which cuts pension amounts for couples receiving basic pensions, will be abolished. Additionally, the government will support the first pension premium for young people to help secure their national pension enrollment, aiming to establish a multi-layered income security system for the elderly. To address the declining regional and essential medical services, a special account worth 12 trillion won will be established, with a focus on investing 36 trillion won in these areas.
On July 16, the Ministry of Health and Welfare announced seven key initiatives under the vision of 'A Welfare State that Respects Life, A South Korea that Leaps Together.' The ministry will focus on: △ A life-saving social safety net △ National responsibility for care △ A sustainable pension system △ Welfare for youth advancement △ Regional medical care in five regions and three specialties △ Growth engines based on bio and AI △ A trusted health and welfare system.
On July 16, the Ministry of Health and Welfare announced seven key initiatives under the vision of 'A Welfare State that Respects Life, A South Korea that Leaps Together.' The ministry will focus on: △ A life-saving social safety net △ National responsibility for care △ A sustainable pension system △ Welfare for youth advancement △ Regional medical care in five regions and three specialties △ Growth engines based on bio and AI △ A trusted health and welfare system.
Overhaul of Basic Pension System to Eliminate Unfair Reductions
The most critical task in this business report is the structural reform of the sustainable pension system. The ministry plans to shift from the current system, which provides a flat rate of 350,000 won to the bottom 70% of seniors, to a structure that offers more pension support to low-income seniors. This change will also revise the existing criteria for the 'bottom 70% payment' to reflect the improved economic status of the elderly, including the baby boomer generation.
Minister Jeong Eun-kyeong stated during a pre-briefing on July 15, "We will reform the basic pension structure based on sufficient social discussions, including the National Assembly's pension special committee. We will transition from providing 350,000 won to all recipients to a structure that offers more support to low-income seniors."
In response to questions during the briefing, she added, "I believe that reforming the basic pension is a very important task for the second half of the year, and it seems that everyone agrees on the principle of lower support for higher income."
The ministry will also eliminate the reduction system, which has been criticized as unfair by senior organizations. The 'couple reduction' system, which cuts 20% of the pension amount for couples both receiving basic pensions, will be abolished. Additionally, provisions that excluded low-income occupational pension recipients and their spouses from eligibility will be improved, with legislative efforts planned for this year.
Efforts to enhance the security and fairness of the national pension will also be undertaken. Starting in 2027, the government will support the first pension premium for 18-year-olds without a national pension enrollment history, covering approximately 42,000 won for one month.
Moreover, the military service credit will be expanded from recognizing 12 months to the entire duration of service, while childbirth credits will be differentiated, offering 12 months for the first child and 15 months for the second.
To ensure fairness, individuals convicted of child abuse or those who have received a prison sentence of 18 months or more for misconduct during military service will be completely excluded from credit benefits. To prevent disadvantages due to information disparities, improvements to the payment system will also be pursued in the second half of this year.
Minister Jeong Eun-kyeong stated during a pre-briefing on July 15, "We will reform the basic pension structure based on sufficient social discussions, including the National Assembly's pension special committee. We will transition from providing 350,000 won to all recipients to a structure that offers more support to low-income seniors."
In response to questions during the briefing, she added, "I believe that reforming the basic pension is a very important task for the second half of the year, and it seems that everyone agrees on the principle of lower support for higher income."
The ministry will also eliminate the reduction system, which has been criticized as unfair by senior organizations. The 'couple reduction' system, which cuts 20% of the pension amount for couples both receiving basic pensions, will be abolished. Additionally, provisions that excluded low-income occupational pension recipients and their spouses from eligibility will be improved, with legislative efforts planned for this year.
Efforts to enhance the security and fairness of the national pension will also be undertaken. Starting in 2027, the government will support the first pension premium for 18-year-olds without a national pension enrollment history, covering approximately 42,000 won for one month.
Moreover, the military service credit will be expanded from recognizing 12 months to the entire duration of service, while childbirth credits will be differentiated, offering 12 months for the first child and 15 months for the second.
To ensure fairness, individuals convicted of child abuse or those who have received a prison sentence of 18 months or more for misconduct during military service will be completely excluded from credit benefits. To prevent disadvantages due to information disparities, improvements to the payment system will also be pursued in the second half of this year.
1.2 Trillion Won Special Account to Revitalize Regional and Essential Medical Care
Significant financial resources will be allocated to strengthen the crumbling foundation of regional and essential medical care. The ministry plans to establish a special account for regional essential medical care worth 12 trillion won by 2027, allowing local governments to plan and implement essential medical policies tailored to regional characteristics.
Additionally, the health insurance fee structure will be completely overhauled for the first time in 25 years, with 36 trillion won allocated for compensation in regional and essential medical fields. This will involve restructuring excessive spending in areas such as imaging and specimen testing to save 26 trillion won in health insurance finances annually.
To address the shortage of medical personnel, the short-term contract system for regional essential doctors, currently implemented in 11 cities and provinces, will be expanded nationwide next year. Long-term plans include the introduction of a regional doctor system by 2027 and the establishment of national medical graduate schools and regional medical colleges by 2030.
Furthermore, to build an emergency and maternity medical system, the number of regional emergency medical centers will be increased to a maximum of 60 by November, and the number of severe maternal and child medical centers will be gradually expanded from two to six.
Additionally, the health insurance fee structure will be completely overhauled for the first time in 25 years, with 36 trillion won allocated for compensation in regional and essential medical fields. This will involve restructuring excessive spending in areas such as imaging and specimen testing to save 26 trillion won in health insurance finances annually.
To address the shortage of medical personnel, the short-term contract system for regional essential doctors, currently implemented in 11 cities and provinces, will be expanded nationwide next year. Long-term plans include the introduction of a regional doctor system by 2027 and the establishment of national medical graduate schools and regional medical colleges by 2030.
Furthermore, to build an emergency and maternity medical system, the number of regional emergency medical centers will be increased to a maximum of 60 by November, and the number of severe maternal and child medical centers will be gradually expanded from two to six.
Enhanced System for Identifying Crisis Households and Coverage of Nursing Home Care Costs
The welfare safety net aimed at alleviating polarization will be further strengthened. To ensure basic living for low-income households, the ministry will determine the increase rate of the median income for 2027 and abolish the criteria for dependents of severe disability beneficiaries starting in the second half of next year. A new emergency referral system for victims of illegal loan sharks will be established to quickly identify financially distressed households, and the emergency welfare system will be reformed to prioritize on-site support for small emergency living expenses.
A comprehensive response to reduce the suicide rate is also noteworthy. According to ministry statistics, the average monthly number of suicides from January to April this year decreased by 12.9% compared to the same period last year.
Minister Jeong stated, "By designating suicide as a social disaster and mobilizing the entire government’s capabilities, the number of suicides from January to April this year has provisionally decreased by 12.9% compared to the same period last year. To solidify this downward trend, we will continue to expand the linkage system to address risk factors that can lead to suicide, such as debt."
To this end, the number of personnel for the suicide prevention hotline '109' will be increased from 103 to 200, and a rapid response team will be introduced.
Plans to alleviate the financial burden of medical expenses for citizens will also be implemented. Starting next year, nursing home care costs for patients with high medical and caregiving needs will be gradually covered, significantly reducing out-of-pocket expenses. Additionally, a 'sick leave allowance' is set to be institutionalized next year to compensate for lost income during periods of illness.
A comprehensive response to reduce the suicide rate is also noteworthy. According to ministry statistics, the average monthly number of suicides from January to April this year decreased by 12.9% compared to the same period last year.
Minister Jeong stated, "By designating suicide as a social disaster and mobilizing the entire government’s capabilities, the number of suicides from January to April this year has provisionally decreased by 12.9% compared to the same period last year. To solidify this downward trend, we will continue to expand the linkage system to address risk factors that can lead to suicide, such as debt."
To this end, the number of personnel for the suicide prevention hotline '109' will be increased from 103 to 200, and a rapid response team will be introduced.
Plans to alleviate the financial burden of medical expenses for citizens will also be implemented. Starting next year, nursing home care costs for patients with high medical and caregiving needs will be gradually covered, significantly reducing out-of-pocket expenses. Additionally, a 'sick leave allowance' is set to be institutionalized next year to compensate for lost income during periods of illness.
Fostering Bio and AI Growth Engines and Eradicating Abnormal Practices
A blueprint for nurturing the pharmaceutical and biotech industry as a future growth engine has also been presented. The ministry aims to establish a mega fund worth 1 trillion won by 2027 to elevate South Korea to the top five in the global pharmaceutical and biotech sector, while selecting and providing concentrated support for '30 representative health care technologies.' Additionally, a 'K-healthcare integrated hub' will be established to attract 3 million foreign patients, along with the introduction of telemedicine services for foreign patients.
Meanwhile, strong measures will continue to eradicate abnormal practices in the medical field that directly affect public health. Since June 15, an administrative investigation team has been activated to eliminate 'fake treatments and fake patients' that involve kickbacks for medical fees, particularly targeting cancer patients. Plans are also in place to enhance investigative and detection capabilities by introducing special judicial police officers to the National Health Insurance Corporation.
Minister Jeong emphasized, "We will expand the 'life-saving welfare policies' that are provided without gaps and protect public health through groundbreaking investments in regional and essential medical systems, actively supporting the balanced growth strategy of five regions and three specialties."
Meanwhile, strong measures will continue to eradicate abnormal practices in the medical field that directly affect public health. Since June 15, an administrative investigation team has been activated to eliminate 'fake treatments and fake patients' that involve kickbacks for medical fees, particularly targeting cancer patients. Plans are also in place to enhance investigative and detection capabilities by introducing special judicial police officers to the National Health Insurance Corporation.
Minister Jeong emphasized, "We will expand the 'life-saving welfare policies' that are provided without gaps and protect public health through groundbreaking investments in regional and essential medical systems, actively supporting the balanced growth strategy of five regions and three specialties."
* This article has been translated by AI.
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