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Learning from Taiwan: Experience with Universal Health Insurance

Karen Davis, PhD; and Andrew T. Huang, MD
[+] Article, Author, and Disclosure Information

From The Commonwealth Fund, New York, NY 10021, and Duke University Medical Center, Durham, NC 27710.

Disclaimer: This work is original and reflects the views of the authors, not those of the officers, directors, or staff of The Commonwealth Fund.

Potential Financial Conflicts of Interest: None disclosed.

Corresponding Author: Karen Davis, PhD, The Commonwealth Fund, 1 East 75th Street, New York, NY 10021; e-mail, kd@cmwf.org.

Current Author Addresses: Dr. Davis: The Commonwealth Fund, 1 East 75th Street, New York, NY 10021.

Dr. Huang: Duke University Medical Center, Box 3942, Durham, NC 27710.

Ann Intern Med. 2008;148(4):313-314. doi:10.7326/0003-4819-148-4-200802190-00011
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As the 2008 presidential election renews the debate about health insurance coverage, the United States can learn from the experience of countries that have recently moved to achieve universal coverage. What gains can we expect from coverage for all in improved health, better access to health care, and reduced financial burdens for the most vulnerable patients? What are the potential downsides of a single-payer system of health care financing?

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Picking up where Reform Left off in Taiwan
Posted on February 26, 2008
C. Jason Wang
Boston University Schools of Medicine and Public Health
Conflict of Interest: None Declared

Wen's study regarding the implementation of Taiwan's national health insurance (NHI) and its impact on mortality in the last ten years showed that NHI had no effect on the mortality of the overall population, but had a modest impact on reducing the mortality among the least healthy townships.1 The editorial by Davis and Huang suggests that having universal health insurance is essential but not sufficient.2

Since the implementation of NHI, Taiwan has undergone two efforts of healthcare reform. The first reform, on which I served as project manager, recommended changes to make health care financing more equitable, NHI governance more accountable, and quality of care better monitored.3 The second reform ("second generation NHI") additionally focused on making healthcare financing more progressive.4 However, few of the recommendations of the first reform were implemented by the government and the second became bogged down in the legislative process. Further, there has been little discussion on the health care delivery system. Wen's paper concluded that more work, such as public health measures, is needed to further improve health and reduce disparities.

In this single payer system, government can play a major role in fostering competition for quality among providers, facilitating integrated care, and encouraging the proper use of health information technology. Currently, Taiwan has two types of global budgets for Western medicine, one for the stand-alone clinics and the other for hospitals, which also operate outpatient departments. Because the money is allocated to separate pools, clinics and hospitals have little incentive to work together and an integrated referral system does not exist. One model Taiwan might follow is legislation recently enacted in Germany, which "enabled the establishment of integrated care network and individual contracting between health plans and providers," and to establish pilot mandatory disease management programs for major chronic illnesses under capitation.5

Taiwan should also take advantage of its single payer system to create a unified health information technology platform for facilitating the flow of care. Electronic health records with e-prescribing capability would facilitate care integration, provider accountability, and medication history monitoring.

Since NHI implementation, there has been a race to expand hospitals and beds, but scant attention paid to developing human capital. Taiwan should enhance provider competencies in evidence-based medicine and quality improvement methodologies.

Wen's paper showed that the national health insurance has made important strides in reducing disparities, but there is a long way to go before Taiwan can declare success.


1. Wen CP, Tsai SP, Chung WS. A 10-Year Experience with Universal Health Insurance in Taiwan: Measuring Changes in Health and Health Disparity. Ann Intern Med. 2008;148:258-267.

2. Davis K, Huang AT. Learning from Taiwan: Experience with Universal Health Insurance. Ann Intern Med. 2008;148:313-314.

3. Huang AT, Wang CJ, Yaung CL. Insuring Taiwan's Health. McKinsey Quarterly. 2001;4:13-16.

4. Lai MS. The Challenges Confronting Taiwan's National Health Insurance: Toward an Accountable System. International Symposium: Toward an Equitable, Efficient, and High Quality National Health Insurance. 2005;Conference paper, Taipei, Taiwan.

5. Porter ME, Guth C, Dannemiller E. The West German Headache Center: Integrated Migraine Care. Harvard Business School. 2007;Case study(9-707- 559).

Conflict of Interest:

None declared

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