A civic watchdog group said Thursday that a proposed 3.2 percent premium rate for second-generation "National Health Insurance" (NHI) is too high because it would lead to premium hikes for all insured persons.

Teng Hsi-hua, a spokeswoman for the group that is monitoring the NHI program, said the new system, which will base premiums on total household incomes rather than the existing system that bases premiums on individual salaries, is expected to increase the premium base by 40 percent.

Therefore, the premium rate - which currently stands at 5.17 percent - should be cut to 3.11 percent under the new system, according to Teng.

With each individual required only to pay 30 percent of the total premium and the employer and the government picking up the balance, the actual premium rate for individuals would be 0.93 percent, she added.

She said that only those with unearned incomes should be made to pay higher premiums under the new system and that wage and salary earners and those with many dependents should not be affected.

However, if the version of the proposal put forward by the Department of Health is adopted, even those fresh out of school who perhaps earn only NT$22,000 per month would see their premiums double, according to Teng.

In response to her comments, "Bureau of National Health Insurance" Director-General Cheng Shou-hsia said that the 3.2 percent premium rate is not final and that the details of the reforms are open to discussion.

On concerns that single individuals would have to pay significantly higher premiums if the household is used as the basic unit of premium calculation in the future, Cheng said the government has yet to determine the definition of "household", but he predicted that not many people will have to pay their premiums independently.

China Daily/CNA

(HK Edition 04/16/2010 page4)