Korea to Overhaul Basic Pension, Expand Hair Loss Coverage

Health and Welfare Minister Jung Eun-kyung announced plans to restructure Korea's basic pension system and extend national health insurance to cover hair loss treatment, speaking at a policy briefing marking the government's first anniversary on June 11 in Seoul's Jongno district.

The pension overhaul would shift to a tiered model — paying lower-income elderly recipients more and higher-income recipients less — targeting the roughly 70 percent of Koreans aged 65 and older who currently receive a flat monthly basic pension. The government cited rising eligibility income thresholds, now at 96 percent of median income, and rapid population aging as key drivers of the reform.

Jung said the government aims to finalize a reform direction within the second half of this year, pending legislative revision and review by the National Assembly's pension special committee. "There are various scenarios being run for fiscal projections, but experts are in principle all in agreement that payments should be strengthened for low-income recipients," she said, adding that implementation would proceed in phases. She also noted expert pushback against sharply cutting the number of eligible recipients, saying the government would present its proposal publicly before seeking broader social consensus.

On emergency care, the government plans to expand a pilot transport coordination program — launched in the Honam region in May — nationwide beginning in September. The pilot links provincial governments, local hospitals, and fire authorities to streamline patient routing; when transport is delayed, regional dispatch centers and priority-reception hospitals step in. Jung described the core problem as structural: "Even if a patient reaches the emergency room, surgery is ultimately what completes treatment — so we need to secure treatment capacity for emergency situations." She said the government is also revising the designation criteria for regional emergency medical centers to evaluate final treatment capability rather than facility and equipment, and that malpractice liability reforms — including relaxed criminal liability for high-risk essential medical care absent gross negligence — are scheduled for the second half of the year.

On hair loss coverage, the Ministry of Health and Welfare said a survey of 1,000 respondents conducted by the National Health Insurance Service returned a positive result, and the government plans to gather further public input through the Ministry of the Interior's "Everyone's Forum" in July before moving forward. President Lee Jae-myung directed the ministry to examine hair loss coverage at a Cabinet meeting late last year, saying young people "appear to treat hair loss as a survival issue."

Jung said the government has not reviewed a cigarette price hike, responding to recent speculation on that front. On concerns that the National Pension Fund is being deployed to prop up domestic equity markets, she denied that characterization, attributing the fund's revised domestic stock target — raised from 14.9 percent to 20.8 percent at the May investment committee meeting — to a correction of a wide gap between actual and target allocations rather than an intentional expansion. She said the same applies to foreign exchange hedging: the policy is aimed at fund returns, not at driving down the exchange rate, and the hedging principles set by the investment committee remain unchanged.

Korea's basic pension (기초연금) is a means-tested flat payment to elderly Koreans in the bottom 70% income bracket — separate from the contributory National Pension. The "하후상박" tiered model would pay less to relatively wealthier recipients within that group.

tiered benefit structure paying more to lower earners; literally "thick below, thin above"