Presidential election and corporate activities
Korea will hold the presidential election, the most important event in politics, in 2022. The presidential election is an important momentum that determines the major political direction for the next five years.
In the health sector, the two main objectives – to improve insurance benefits for better health of the public and the advancement of the health industry – will remain unchanged.
However, who takes power in the presidential election will decide how different specific policies will differ and have a huge impact on businesses and the healthcare industry.
For example, the strengthening of insurance coverage for serious and rare diseases, pushed by the former Park Geun-hye administration, brought about regulatory changes to allow more innovative drugs to come to the local market.
The so-called “Moon Jae-in Care,” or the National Health Insurance Expansion Policy introduced by the Moon Jae-in government, has helped revitalize medical screenings, including MRIs, and improve access to new drugs.
The result of the presidential election significantly affects the political orientation of the next government.
Presidential candidate Lee Jae-myung of the ruling Democratic Party and his rival Yoon Seok-youl of the opposition People’s Power Party are running for president.
Liberal Lee should focus on distribution through a fair economy. In contrast, conservative Yoon is likely to focus on economic growth based on market principles with economic justice.
The implementation of measures for the management of health insurance finances will be imperative for the two candidates because of the aging of the population.
However, the two will have very different approaches to solving the problem.
Suppose Lee wins the election and the ruling party regains power. In this case, his government will continue and expand the Moon Jae-in Care policy, rated as the most successful policy under the Moon Jae-in government. In addition, to strengthen health insurance coverage, it is likely to control uninsured care and integrate compensation and health insurance.
In Lee’s victory scenario, civic groups and health experts advocating for the public nature of health care will have a stronger voice. Next, the government will strive to maintain the financial strength of the National Health Insurance Service and strengthen control over the health market. Lee’s government should focus more on locating critical healthcare resources as part of health security rather than seeing the industry from the perspective of the global economy.
In contrast, if Yoon wins, he will bring sweeping changes to health policies, including health insurance.
The current conservative camp opposes the Moon Jae-in Care. Yoon’s government is likely to emphasize selective health insurance coverage so that those who need health insurance can get it.
In this scenario, the improvement in benefits for rare diseases will be significant. Yoon’s government is likely to recognize the need for non-reimbursable care and support the activation of indemnity insurance to expand healthcare consumer choices.
Yoon’s government is likely to help the healthcare industry become globally competitive.
Various cooperation projects will attract overseas patients and help Korean companies to expand overseas business.
So how should businesses prepare for the presidential election?
First, they should carefully monitor policy changes that affect their business operations between March 9, when the elections are over, and May 9, when the new government inaugurates, a transition team will be put in place. The broad policy directions set at this time will decide the next five years of the new government, so we need to take a close look at the decision-making process this time around.
Second, companies should be careful not to disclose internal company issues such as disputes with stakeholders or civic groups during the first phase of government inauguration. As the first impression is crucial in a relationship, how a company welcomes the new government can greatly affect the relationship over the next five years.
Finally, it is time for companies to strategically explain their role as corporate citizens to society and people. Indeed, the power of citizens has grown and the frequent elections every two years make it difficult for the government and politicians to accept the demands of companies that have no social support.
Now is the time for business to participate in social development to overcome political risks and improve management sustainability.