NHIS President “will improve the PVA system"

announces plans to improve the price-volume agreement system

Will adjust the maximum discount rate, improve the negotiation reference formula, and derive a plan to expand the exclusion criteria in the PVA system

Will apply the refund type performance-based RSA to high-priced drugs that cost over KRW 300 million

NHIS President Do-Tae Kang is explaining NHIS

Do-Tae Kang, President of the National Health Insurance Service expressed plans to continue managing pharmaceutical expenditures by preparing a plan to improve the price-volume agreement (PVA) negotiation system within the year.

 

Also, Kang added that the NHIS will be applying the refund type of the performance-based risk-sharing agreement (RSA) system that was applied to Kymriah and Zolgensma to high-priced drugs that cost over KRW 300 million and reduce the reimbursement negotiation period for new anticancer or severe and rare disease drugs.

 

At a new year’s roundtable meeting with industry journalists that was held at a Korean-Chinese restaurant in Mapo-gu on the 16th, Kang explained that he would promote such policies this year as part of HIRA’s plan to manage drug expenditures.

 

Kang said, “Our research service results showed that the PVA system has produced great outcomes in reducing NHIS’s drug expenditures and had a positive impact from a social and industrial aspect.

 

Based on the results, we will work with pharmaceutical companies and the working group to prepare improvement plans to continue managing pharmaceutical expenditures this year by adjusting the maximum discount rate, improving the negotiation reference formula, and deriving a plan to expand the exclusion criteria, etc.” The refund type of the performance-based RSA system is expected to be mainly used as a measure to manage high-priced new drugs.

 

Kang said, “Drug expenditures have been soaring every year in line with the rising social demand for high-priced new drugs.

 

However, the mechanism for predicting and controlling drug expenditures is yet inadequate.

 

We plan to apply the ‘expenditure cap type’ and ‘performance-based refund type’ RSA to new drugs with high prices that were recently developed and have unverified treatment efficacy and cost-effectiveness to consider both the accessibility to essential drugs and fiscal health of Korea’s national health insurance.” He added, “We introduced a ‘performance-based refund type’ of RSA where pharmaceutical companies bear a portion of the expenditures according to treatment performance to reimburse the ultra-high-priced drugs Kymriah and Zolgensma.

 

This year, we plan to expand the performance-based refund type RSA to drugs that cost over KRW 300 million and shorten the negotiation period for anticancer drugs or new severe or rare disease drugs for prompt listing.” The NHIS also plans to prepare a plan to improve the fee negotiation system and find the right balance between the parties.

 

Kang said, “Despite the difficult economic situation, Korea’s national health insurance finances are expected to see a surplus for the second year in a row, therefore fee negotiations are expected to be quite difficult this year.

 

While the subscribers are expected to request a minimum raise in fees, the suppliers are expected to demand a bigger raise in fees as a compensatory measure in consideration of the companies’ management difficulties." He added, “As NHIS is in charge of managing NHI finances, we will comprehensively consider the fiscal soundness, essential medical reinforcement policies, and the subscribers’ insurance premium level to find a reasonable balance between parties.

 

Based on the results of the research service, we will conduct a multilateral analysis and discuss with the ‘system development consultative body' that subscribers and suppliers are involved in to prepare an agreeable model and apply it to fee negotiations." NHIS will also continue to manage chronic diseases and promote the big data business this year.

 

Kang said, “We have been promoting a 'Pilot project on primary care for chronic disease', which provides annual care plans and services for patients with hypertension and diabetes in neighborhood clinics and have advanced the chronic disease management model by managing service quality and improving the project participation process.

 

This year, we will consult with stakeholders and the government to reach an agreement on the appropriate fee level and copayment rate, conduct a pilot project, and then promote its conversion to a main project." Regarding the big data business, the NHIS has been providing customized health information for individuals on their health status and life cycle through mobile apps and will develop a new personal health record (PHR) service to promote public health and manage the disease with a ‘QR Electronic Prescription System’ among others in the future.

 

Also, as a data integration institution, the NHIS will develop a guideline for the provision of combined data and expand the analysis center to promptly provide data necessary for drug development and research.

 

Kang said, “The health insurance finances are being stably operated so far.

 

We expect a current account surplus that exceeds what was made in 2021 to occur in 2022." “However, fiscal expenditures are continuing to increase due to the aging population and the introduction of new health technologies.

 

Therefore, we will do our best to responsibly carry out key tasks by independently operating the 'fiscal consolidation promotion team,’ and find new tasks to pursue in line with the mid-term fiscal consolidation plan.” On this, the NHIS opened a ‘Proposal and report center to protect the fiscal soundness of NHI finances’ in December last year to reinforce the management of financial leakage factors by directly collecting public opinion.

 

After the operation of the report center, reports were filed on illegal medical institutions and unfair claims, for which an investigation is underway.

 

Lastly, regarding the embezzlement of its employee last year, “Many people must have been shocked and disappointed by the disreputable incident.

 

The NHIS announced comprehensive measures last November to fundamentally prevent the recurrence of such events, and consulting with external specialized institutions is currently underway for a more professional inspection.

 

After the consultations are complete, we will prepare improvement plans for each work type and implement them immediately.” He added, "In addition, we plan to support insurance premiums for the low-income and the vulnerable class whose insurance premiums are significantly less likely to be collected, by using donations voluntarily collected from NHIS executives and staff.”