Catastrophic medical expense program burns through 95% of budget, with average wait of 84 days

The government's catastrophic medical expense support program has spent 95 percent of its annual budget through September, while the average time for applicants to receive payments has ballooned to 83.7 days this year — nearly four times the 2023 figure.

With mid-year budget supplements becoming an annual occurrence, calls are growing for the government to set a more realistic base budget and eliminate payment delays.

According to data submitted to Democratic Party of Korea lawmaker Nam In-soon of the National Assembly's Health and Welfare Committee by the National Health Insurance Service, 141 billion won ($105 million) of the program's 148.5 billion won budget for this year had been spent through last month. The spending rate stands at roughly 95 percent, leaving 7.5 billion won unspent.

The catastrophic medical expense support program subsidizes a portion of medical costs for people whose hospital bills are disproportionately large relative to their income. Despite its purpose of easing the financial burden of medical care, the time from application to payment has been growing steadily longer.

The average processing time rose from 21 days in 2023 to 35 days in 2025, and has reached 83.7 days this year — about 2.4 times longer than last year. At least one applicant waited 445 days after applying.

To address the budget shortfall, the National Health Insurance Service plans to allocate an additional 83.1 billion won in the fourth quarter through lottery funds and national health insurance contributions.

Mid-year budget increases have been repeated every year. The program received supplementary allocations of 7.7 billion won in 2023, 27.1 billion won in 2024 and 60 billion won in 2025, bringing the total budgets for those years to 102.29 billion won, 160.61 billion won and 212.36 billion won, respectively. If additional funding is approved this year, it will mark the fourth consecutive year the program has required resources beyond its original budget.

The Ministry of Health and Welfare calculates the program's budget, and the National Health Insurance Service allocates funds in line with the government appropriation. Nam's office said the government and the service had consistently underestimated demand, failing to account for the increase in applications driven by relaxed eligibility criteria and an expanded list of covered conditions.

"The government and the service must stop the annual cycle of stopgap budget increases and introduce a sophisticated demand-forecasting model to set a realistic base budget," Nam said. "They must also overhaul the payment system so that funds are disbursed immediately upon approval."