South Korea's Healthcare Expenditure: A Comprehensive Study of Public and Private Spending Across Health Conditions, Demographics, and Payer Types (2011-2020)

OBJECTIVES: South Korea's health expenditure has rapidly increased, accounting for 9.7% of its GDP in 2022—the highest growth among OECD countries. This study analyzes the trends in healthcare spending from 2011 to 2020, exploring public and private expenditures, demographics, and types of services.

METHODS: Utilizing data from the National Health Insurance (NHI) and Korea Health Panel Survey (KHPS), the study examines trends across public insurance and out-of-pocket (OOP) payments, segmented into payments for covered (OOP1) and non-covered services (OOP2). Multiple imputation by chained equations (MICE) addresses missing data, allowing detailed analyses by payer and service types, sex, age, and income levels.

RESULTS: From 2011 to 2020, total healthcare expenditure surged from KRW 50.7 trillion to KRW 90.7 trillion, with an average annual growth rate of 5.4%. Public insurance spending grew by 5.1%, while OOP payments increased by 6.0% for OOP1 and 6.7% for OOP2, peaking just before the COVID-19 pandemic. In 2020, public expenditure accounted for 64.4% of total spending, markedly below the OECD average. A demographic analysis revealed that individuals over 60 were responsible for 51.3% of the total expenses. Gender disparities were evident, particularly in peak fertility ages and among the elderly, with women incurring higher costs, especially in obstetrics and gynecology. The fastest-growing OOP costs were for non-covered services across all income levels, highlighting the burden of additional payments. Key health conditions driving expenses included musculoskeletal, urinary, and ophthalmic conditions, alongside chronic ailments like hypertension and diabetes.

CONCLUSIONS: The study highlights the need for policies to extend healthcare coverage and reduce the economic strain on individuals, particularly through managing the increase in OOP expenses and addressing disparities across demographic groups. Suggestions include refining the KHPS and integrating private insurance data to better track expenditures and develop effective policies, thereby promoting a more equitable and sustainable healthcare system in South Korea.