Shou-Hsia Cheng

Aging population and increasing prevalence of chronic conditions challenge almost every country worldwide, Taiwan is no exception. With affordable national spending on health (about 6.5% of GDP), acceptable overall health outcome (life expectancy of 80 years) and very high public satisfaction (70-80%), the Taiwanese health system is considered one of the best around the globe. Researchers and policymakers attribute the achievement mainly to the establishment of a universal health coverage program, i.e. the National Health Insurance (NHI) scheme in 1995.

Under the NHI fee-for-services payment scheme with an annual global budget cap, health care providers are willing to provide services to patients which leads to potential over-use of health services. On the other hand, freedom of choice allows patients to visit a preferred provider for every episode which lead to serious fragmented care. The NHI administration had introduced various types of payment reform to improve quality and/or efficiency of health care such as pay-for-performance programs for specific diseases, diagnosis-related grouping (DRG) payment for inpatient services, and a pilot capitation payment program. Certain programs have achieved their initial objectives while some programs obviously have failed.

While facing rapid growth of aged population with multiple chronic conditions and modest economic growth in Taiwan, the health authorities need new strategies for healthcare reform. How can we shift from provider-centered care model to patient-centered one, and shift from volume-based payment to value-based payment? There are definitely challenges and also opportunities ahead of us.