A Korean model of primary care: Multi-specialty group practices (polyclinics)

These fundamentals for primary care reform - reforming payment systems, ensuring institutional flexibility and supporting primary health care workers - in themselves are unlikely to be sufficient to ensure the development of a stronger primary health care sector. The OECD work published in OECD Reviews of Health Care Quality: Korea - Raising Standards (2012b) recommended that policy makers seek out desirable models of what uniquely Korean approaches to primary health care services should look like and support them. This section builds on the broad approach outlined in the earlier report by providing some potential paths to scale up primary care in Korea.

Encouraging hospitals to vertically integrate may be the optimal policy, but is likely to be difficult to achieve

Given that the centre of gravity in the health care system is in the hospital sector, a possible path to bolstering primary care would be to strengthen the financial interests of hospitals to deliver more primary care. Given Korean interest in the US health system, it is surprising that there has been limited interest in moving towards a model of integrated care, where an organisation receives a capitated payment from the National Health Insurance to manage all of the care of the patients. This type of reform provides incentives for big hospitals to restructure their service delivery model to include stronger primary care. This would require comparatively simple changes to payment methods, or at least experimentation to allow some big hospitals to receive a capitated payment.

While vertical integration and encouraging hospitals to invest downstream has some advantages, there is a risk that it could simply reinforce Korea’s hospital-centric health system. With Korea’s largest tertiary hospitals accounting for a major share of activity as well as having a major financial influence in the system, making them responsible for primary care may perversely result in them under-investing in primary care, as it conflicts with their incentive to deliver high-margin acute-care services. This is evident in the some of the large hospitals in Korea which currently offer primary care through clinics located on site but functionally use this as a gateway to more complex services.

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