Delisting policy reform in South Korea: failed or policy change?

The sustainability of national health insurance in South Korea has been under threat because of the relative and absolute high expenditure on drugs and its fast rate of increase. According to this need, a Drug Expenditure Rationalization Plan (DERP) was enacted in late 2006, and a reevaluation project to delist drugs started in 2007 as one part of the DERP.

This article follows the process of the delisting policy in Korea. It addresses the history of the policy implementation and its changes, content, and impact and suggests a more reasonable policy direction, thereby setting a helpful example for other countries.

After a pilot reevaluation and the subsequent evaluation of a hypertension drug, the DERP fell into arrears as regards its original time line mainly because of the difficulties in developing methodologies and the government's inexperience in managing a megascale reevaluation project. The confusion and conflicts during the evaluation became a major burden on the government and society. Finally, the government changed the framework of the delisting policy from reevaluation based on cost-effectiveness to across-the-board price reductions aiming at the quick attainment of financial savings and minimizing conflict between the government and stakeholders.

The government should lead the project with a more consistent and sustainable assessment framework of cost-effectiveness as the tool for the rational allocation of health resources, providing strong leadership and political will and a far-sighted view rather than focusing on compromise with special interest groups. In addition, development of more practical and multidimensional evaluation methodology is needed.