Rest and Get Paid When Sick... Nationwide Expansion of "Sickness Benefit" Planned for Second Half of Next Year

Institutionalization Accelerates as Need Grows After COVID-19 Pandemic
Pilot Project Nears Completion... Health Insurance Likely as Main Funding Source

The government is planning to transition the sickness benefit system, which has been operated as a pilot project, to a nationwide full-scale project starting in the second half of next year, and expand eligibility to cover the entire population.

On the 12th, Yonhap News Agency reported, citing government and civil society sources, that the Ministry of Health and Welfare recently held a meeting to promote the full rollout of the sickness benefit program and shared plans to implement it nationwide in the second half of next year.

The sickness benefit is a social security program that provides income replacement for a certain period when a person is unable to work due to illness or injury unrelated to work, allowing them to focus on treatment. It is also expected to help reduce so-called "presenteeism"—going to work despite being ill—and to prevent the spread of infectious diseases. The need for such a system has grown significantly since the COVID-19 pandemic.

The government will convert the sickness allowance, which has been operated as a pilot project, into a nationwide full-scale project starting from the second half of next year. Yonhap News

Among the member countries of the Organisation for Economic Co-operation and Development (OECD), most already operate a sickness benefit system, with the exceptions of Korea and the United States. In Germany and France, a significant portion of wages is replaced for a certain period based on health insurance, while the United Kingdom supports workers' income through the statutory sick pay system. Since July 2022, Korea has been preparing for the full introduction of the system by conducting a three-stage pilot project for employed people aged 15 to 64.

As of the end of May this year, a total of 20.367 billion won in sickness benefits has been paid out since the pilot project began. There were 14,141 recipients, each receiving an average of about 1.44 million won for 30.4 days. By age group, those in their 50s accounted for the largest share at 40.3 percent, followed by those in their 40s and 60s. Employees with health insurance accounted for 72.7 percent of all recipients, while the self-employed and those with employment or industrial accident insurance were also included as beneficiaries.

Based on the results of the pilot project, the government is working to specify eligibility, coverage levels, and the operational model for the nationwide rollout in the second half of next year. Last year, the institutional design was discussed with an expert advisory group, and this year, the government is gathering feedback from stakeholders including labor and medical communities.

The main funding source is likely to be health insurance benefits. The current National Health Insurance Act stipulates that sickness benefits can be provided as a health insurance benefit, and most OECD countries with medical security systems also finance such benefits through social insurance rather than taxation.

This content was produced with the assistance of AI translation services.