Taiwan is an instructive case for the comparative study of health politics in East Asia. Its National Health Insurance (NHI) program, launched in 1995, achieved near-universal population coverage within a single year of implementation, a notably rapid pace of expansion that demonstrated the capacity of a newly democratizing state to deliver comprehensive social policy reform (Lu & Hsiao, 2003). Its long-term care system, by contrast, has evolved incrementally and contentiously over three decades, reflecting deeper tensions between familialism, fiscal constraint, and democratic competition that have yet to be resolved. Together, these two policy domains constitute the core institutional architecture through which health politics in Taiwan is organized and contested.

This article advances a specific analytical claim: Taiwan’s health politics is structured by two enduring cleavages that connect its two core policy domains, even though each is anchored primarily in one. The first cleavage runs between technocratic cost containment and electorally driven service expansion. In the NHI, this tension manifests in recurring conflicts over premium rates, global budget ceilings, and pharmaceutical spending, while in LTC it appears in disputes over tax financing, social insurance, and service expansion. The second cleavage runs between public care provision and household-based migrant labor. It is most visible in the relationship between the expanding public LTC system, now moving from LTC 2.0 to LTC 3.0, and the partially regulated but weakly protected regime of household-employed migrant caregivers, but it also appears in NHI-related inpatient integrated care programs that seek to reduce family caregiving burdens (National Health Insurance Administration, 2024b). These cleavages are not merely descriptive categories; they generate asymmetric policy outcomes because actors benefiting from visible expansion or regulatory accommodation can exert more concentrated pressure than those benefiting from long-term fiscal discipline or labor formalization, biasing reform toward incremental expansion, deferred fiscal adjustment, and continued reliance on stratified care labor.

The article is organized as follows. After describing the analytical approach and mapping the partisan dynamics and institutional context of Taiwan’s health policy, it examines the NHI’s institutional architecture, reform trajectory, and fiscal politics, with particular attention to the micro-politics of premium negotiation. It then traces the development of long-term care from fragmented services through LTC 2.0 and the emerging LTC 3.0 agenda, before analyzing the power dynamics that distribute influence unevenly across state, capital, professions, and civil society actors. The analysis of contemporary contestation focuses on the most politically salient recent development: the 2024 to 2025 legislative changes governing migrant caregiver hiring requirements. The article concludes by identifying four analytic gaps that merit further scholarly attention.

Taiwan’s health policy has been shaped by competition between two major parties operating within the institutional legacies of the developmental state. The KMT, which governed Taiwan under martial law until 1987 and retained the presidency until 2000 (and again from 2008 to 2016), built the foundations of what Holliday (2000) characterized as a productivist welfare regime, including the extension of labor insurance and the planning of national health insurance in the early 1990s (Wong, 2004). The DPP, emerging from the democratic opposition movement, has sought to differentiate itself through social policy appeals (Fell, 2005), a stance that would later inform its positions on long-term care and pension reform. This pattern of partisan competition driving welfare state expansion echoes what Kwon (2005) identified as the broader transformation of developmental welfare states in East Asia, where democratization created new incentives for social policy innovation. Within this framework, ideological contestation has crystallized around three policy axes through which the two higher-level cleavages appear: tax financing versus social insurance for long-term care, familialism versus socialized care responsibilities, and technocratic cost containment versus electorally driven service expansion.

Long-term care policy did not emerge as a prominent political issue until the 2000s. The KMT government initiated modest community-based care programs in the late 1990s, but systematic policy development began only under the DPP administration of President Chen Shui-bian (2000 to 2008), which approved the first Ten-Year Long-Term Care Plan in 2007. This plan, subsequently known as LTC 1.0, established a tax-financed service delivery framework encompassing home care, day care, and respite services (Chen & Fu, 2020). The late arrival of long-term care as a policy priority illustrates the path-dependent sequencing characteristic of East Asian welfare state development, where population aging accelerated before institutional care infrastructure had been established.

Several institutional actors have shaped health policy trajectories in Taiwan. The Executive Yuan (cabinet) and its subordinate ministries, particularly the Ministry of Health and Welfare, serve as the primary policy-making bodies. The Legislative Yuan exercises budgetary oversight and has become an increasingly active arena for health policy contestation, particularly on LTC-related legislation. Within the bureaucracy, the NHIA operates with considerable administrative autonomy in managing the global budget and provider payment systems.

Professional associations, including the Taiwan Medical Association and hospital management organizations, exert significant influence over NHI payment negotiations. In the long-term care domain, advocacy coalitions have been more fragmented, with women’s organizations, disability rights groups, and migrant worker unions occupying distinct positions on care policy.

This article employs a historical-institutional approach to analyze Taiwan’s health politics. As a theoretical/conceptual article, its primary contribution is the development of a conceptual framework rather than the generation of new empirical data. The analysis draws on three categories of materials: (a) primary policy documents, including legislative texts, executive orders, ministerial announcements, and statistical reports from the National Health Insurance Administration, the Ministry of Health and Welfare (MOHW), the Ministry of Labor, the Executive Yuan, and the National Development Council; (b) civil society publications, including statements and policy positions issued by women’s organizations, migrant worker unions, and care worker unions; and (c) the secondary scholarly literature on Taiwan’s health policy, East Asian welfare states, and care migration regimes.

Sources were selected to cover NHI’s founding in 1995 through the 2026 launch of LTC 3.0 and migrant caregiver hiring changes in 2024 to 2025. Primary sources were included when issued by central government agencies, statutory databases, or official administrative bodies and directly concerned NHI financing, LTC design, migrant caregiver regulation, or demographic and labor statistics; scholarly sources were included when they were peer-reviewed articles or academic books retrievable through Google Scholar. Non-official media commentary was excluded from factual claims. Materials were read iteratively against the framework, with attention to (a) institutional design, (b) premium adjustment and care provision, and (c) the relationship between public care infrastructure and household-based migrant care labor. The two-cleavage framework was used as a sensitizing conceptual lens at the outset and then refined inductively through this reading before being applied back to the policy record to assess explanatory traction and identify the analytic gaps presented below.

The NHI, established in 1995 under the KMT government of President Lee Teng-hui, consolidated more than a dozen fragmented insurance schemes into a single mandatory program that, by official 2024 reporting, covered more than 99.9 percent of Taiwan’s residents (National Health Insurance Administration, 2024a). The decision to adopt a single-payer model rather than a multi-payer social insurance system reflected both the technocratic influence of the Harvard team led by William Hsiao and the political calculus of a regime seeking democratic legitimacy during Taiwan’s political transition (Cheng, 2003). Financing is shared among enrollees, employers, and government, with premiums calculated as a percentage of payroll income. The system provides comprehensive benefits encompassing outpatient, inpatient, pharmaceutical, dental, and traditional Chinese medicine services, with modest co-payments and full subsidies for low-income households.

A distinctive feature of the NHI is its global budget payment system, introduced in phases between 1998 and 2002, under which total expenditure for each sector is negotiated annually between the NHIA, provider representatives, and government. The global budget has been credited with moderating expenditure increases relative to GDP; however, research has found that it generated perverse incentives, as hospitals strategically expanded service volumes with an emphasis on products carrying higher price-to-marginal-cost ratios, and larger hospitals were better positioned to induce demand at the expense of smaller counterparts (Chen & Fan, 2015).

The most significant structural reform occurred in 2013, when the Second-Generation NHI took effect. This reform broadened the contribution base by introducing a supplementary premium on six categories of non-payroll income, addressing horizontal equity concerns that the original premium structure had disproportionately burdened salaried workers while exempting capital income. The reform also restructured the Supervisory Committee and the Medical Expenditure Negotiation Committee, providing more effective institutional channels for stakeholder input into budget allocation decisions (Cheng, 2015).

Despite the Second-Generation reform, the NHI continues to face structural fiscal pressures driven by population aging, chronic disease prevalence, and the diffusion of high-cost medical technologies. Taiwan’s total fertility rate, among the lowest globally at approximately 0.87 in 2023 (National Development Council, 2024), combined with one of the most rapidly aging populations in East Asia (the proportion of the population aged 65 and above surpassed 14 percent in 2018 and is projected to exceed 20 percent by 2025; National Development Council, 2024), generates sustained upward pressure on health expenditure.

The institutional structure of premium adjustment illustrates the first of the two cleavages that organize Taiwan’s health politics. Under Article 24 of the National Health Insurance Act, premium-rate proposals are reviewed by the NHI Committee and then reported by the Ministry of Health and Welfare to the Executive Yuan for approval. Article 26, by contrast, concerns adjustments to the scope of benefits when the system’s financial balance is threatened. This distinction matters analytically because it distributes decision-making authority differently: Article 24 adjustments require explicit executive approval, concentrating political accountability, while Article 26 adjustments operate through a more technical, benefit-scope mechanism that partially diffuses political responsibility. In practice, the premium adjustment process governed by the NHI Committee’s deliberations and Executive Yuan approval carries significant political costs. The January 2021 increase to 5.17 percent illustrates the politics of this process: the technocratic case for fiscal stabilization had to pass through NHI Committee review, where organized provider and payer interests could contest the proposal, before the Executive Yuan had to absorb the electoral burden of approving a visible contribution increase.

The political logic is structurally asymmetric: administrations that propose premium increases bear the electoral cost, while the benefits of fiscal stabilization are diffuse and temporally remote. This asymmetry helps explain the pattern of incremental adjustments, reserve management, and cost-shifting strategies that have characterized recent fiscal governance, deferring rather than resolving the structural gap between revenue and expenditure growth (National Health Insurance Administration, 2023). Large hospital systems contest allocation within the global budget framework through the Medical Expenditure Negotiation Committee, while pharmaceutical expenditure remains a persistent factor in cost-containment discussions (Cheng, 2003; National Health Insurance Administration, 2023). The micro-politics of annual NHI Committee deliberations, including proposal sequencing, informal bargaining, and the translation of provider interests into budget outcomes, therefore remain a critical area for future research.

Taiwan’s long-term care policy developed through three identifiable phases. From 1998 to 2006, care services were provided through fragmented programs administered by multiple government agencies, with limited coordination and no unified policy framework. The launch of LTC 1.0 in 2007 marked the first attempt at systematic integration, establishing community-based home care, day care, and respite services under a tax-financed model operated through local government contracting with nonprofit service providers (Chen & Fu, 2020).

LTC 1.0 faced persistent challenges, including low service utilization rates, insufficient workforce supply, uneven geographic coverage, and limited public awareness. Service uptake remained well below projected targets throughout the plan’s implementation period (Chen & Fu, 2020). The KMT government under President Ma Ying-jeou (2008 to 2016) proposed a social insurance model for long-term care financing, but the Long-Term Care Insurance Bill was shelved following the KMT’s defeat in the 2016 elections.

The DPP’s return to power under President Tsai Ing-wen in 2016 brought a decisive policy reorientation. Lin Wan-I, a social welfare scholar who had written extensively on welfare state development (Lin, 2012), was appointed as Minister without Portfolio in the Executive Yuan (Executive Yuan, 2016b) and served as convener of the Executive Yuan’s Long-Term Care Promotion Task Force (Executive Yuan, 2016a). Lin played a central role in the design and implementation of LTC 2.0, bringing academic expertise in comparative welfare state analysis directly into the policy process.

Rather than continuing the social insurance model proposed under the previous KMT administration, the Tsai government retained tax financing while expanding long-term care services. LTC 2.0 was approved in December 2016 and implemented from 2017, with some official materials treating June 2017 as the operational start. In addition to expanding eligibility and service volume, it aimed to promote aging in place, build integrated community-based care, prevent or delay disability, and reduce family caregiving burdens (Executive Yuan, 2024; Ministry of Health and Welfare, 2024). The reform introduced a three-tiered delivery structure composed of A-level community integrated service centers (社區整合型服務中心), B-level combined service centers (複合型服務中心), and C-level neighborhood long-term care stations (巷弄長照站) (MOHW, 2018b). More broadly, it marked a political choice to treat long-term care as a tax-funded social service rather than as a contributory insurance program.

The plan introduced a case-mix classification system in which care needs are assessed on a scale of levels 1 through 8, with only levels 2 through 8 falling within the benefit scope and government subsidies calibrated to disability severity. Persons assessed at level 1 are classified as having only mild functional limitations and are not eligible for LTC 2.0 services. Care managers were assigned to coordinate service packages for individual recipients, mediating between assessed needs and available providers.

Beginning in January 2018, the MOHW introduced a new payment and subsidy framework (長照給付及支付新制) that shifted to volume-based reimbursement and established minimum compensation standards for home care workers, including a monthly floor of NT$32,000 for full-time workers and NT$200 per hour for part-time workers. These measures aimed to improve recruitment and retention in a sector where low wages and high turnover have been persistent challenges (MOHW, 2018a). Co-payment rates were differentiated by economic status and service type. According to official fee schedules, general households pay co-payment ratios ranging from 16 to 30 percent depending on the specific service category, while households classified under the second economic tier pay between 5 and 10 percent, and low-income households are fully subsidized. Additional subsidies are available for transportation, assistive devices, and home accessibility modifications.

The LTC 3.0 plan, approved at the end of 2025 for implementation from 2026 to 2035, extends rather than replaces LTC 2.0. It retains LTC 2.0’s community-based, person-centered, continuous-care orientation while adding stronger integration across home, community, institutional, medical, and social-welfare services under the goals of healthy aging, aging in place, and end-of-life dignity. Official planning identifies eight directions: community co-care, medical-care integration, post-acute rehabilitation and discharge preparation, residential-care capacity and quality, family support and inpatient care, smart care and assistive technology, palliative and advance-care planning, and workforce training (MOHW, 2025). The plan also strengthens the NHI–LTC interface through post-acute care (PAC) linkage and projects public-service coverage targets of 82 percent in 2026, 86 percent in 2030, and 89 percent in 2035 (MOHW, 2025). Analytically, LTC 3.0 reinforces rather than resolves the cleavages identified here: it expands visible public services through tax- and fund-based financing while leaving the household-employed migrant caregiver regime outside the Labor Standards Act’s core protections.

Power in Taiwan’s health politics is distributed unevenly across policy domains. In the NHI arena, the state retains dominant authority through the NHIA’s monopsony purchasing power and its capacity to set global budgets. Provider organizations, particularly large corporate and foundation-affiliated hospital systems, exercise countervailing influence through the Medical Expenditure Negotiation Committee, where annual budget ceilings are contested. Among provider actors, major hospital systems are widely regarded as holding considerable bargaining leverage, given their capacity to concentrate patient volume and expand higher-margin service lines relative to smaller providers and clinics. The pharmaceutical sector constitutes a further area of contestation; drug pricing adjustments and generic substitution policies have been recurrent points of friction, though the precise mechanisms of industry influence on legislative and administrative processes remain insufficiently documented in the academic literature (National Health Insurance Administration, 2023). During the formative period of the NHI, the medical profession’s political influence was channeled through both formal institutional mechanisms and informal networks connecting physicians to legislative representatives (Wong, 2004).

In the long-term care domain, power dynamics are more diffuse and contested. The state’s role as financier and regulator is mediated by local governments responsible for service delivery and provider contracting. The expansion of LTC 2.0 and the transition to LTC 3.0 have also attracted for-profit home care agencies into the provider market, introducing a new capital dynamic in which private operators compete alongside nonprofit organizations for government contracts and shape service delivery patterns through their market strategies. The most distinctive power dynamic in Taiwan’s care politics, however, concerns migrant care workers. Since the enactment of the Employment Service Act in 1992, Taiwan has permitted households to hire foreign caregivers, predominantly women from Indonesia, the Philippines, and Vietnam. By the end of 2024, Ministry of Labor statistics recorded 246,784 migrant caregivers (看護工) and 2,248 domestic helpers (家庭幫傭) employed under the social-welfare category, with the overwhelming majority being women (Ministry of Labor, 2025a). Household-employed migrant caregivers therefore constitute a parallel workforce that is partially regulated but weakly protected: they are governed by the Employment Service Act and related administrative rules concerning hiring, permits, and employment categories, but family-based caregivers remain outside the Labor Standards Act’s core working-time, rest-day, and minimum-wage protections (Employment Service Act, 2025; Ministry of Labor, 2025c). Taiwan’s care regime thus combines public long-term care expansion with a stratified household-based labor system.

Civil society organizations have emerged as vocal participants in care policy debates. Groups such as the Awakening Foundation (婦女新知基金會), the Taiwan International Workers’ Association (TIWA, 台灣國際勞工協會), and the Taoyuan City Home Carers Professional Union (桃園市家庭看護工職業工會) have at various points issued joint statements and public interventions challenging the treatment of migrant caregivers as disposable labor (Awakening Foundation, 2024). These organizations have called attention to the fact that household-employed caregivers lack regulated working hours, minimum wage guarantees, and protections against employer abuse (Lan, 2006). The gendered structure of this system is pronounced: among all social welfare migrant workers, women account for over 99 percent, effectively transferring the costs of social reproduction onto the most vulnerable segment of the transnational labor force (Ministry of Labor, 2025a).

The most intensely contested issue in contemporary health politics involves the regulation of migrant caregivers and its relationship to the public long-term care system. The parallel existence of a publicly financed LTC system, expanded through LTC 2.0 and LTC 3.0, and a partially regulated but weakly protected household caregiver market has created structural contradictions that have made migrant caregiver regulation an increasingly salient issue in electoral competition between the two major parties. This contestation is the site where the second cleavage in Taiwan’s health politics, between public care provision and household-based migrant labor, is most visible.

Public debate framed the issue through the shorthand of “Barthel Index exemption” (巴氏量表免評). The Barthel Index is a standardized functional assessment scale used to measure a person’s capacity to perform basic activities of daily living. Under the pre-existing regulatory framework, families seeking to hire a migrant live-in caregiver were required to obtain a formal assessment at a designated medical institution, a process widely perceived as burdensome, opaque, and inconsistently administered. The phrase 巴氏量表免評 (“exemption from Barthel Index assessment”) thus became political shorthand in public debate for the broader demand to simplify access to migrant caregivers, though the actual legal change was narrower and more precise.

After administrative exemptions were expanded in October 2023 (Ministry of Labor, 2023), the Legislative Yuan passed the amendment to Article 46 of the Employment Service Act on December 31, 2024, and the revised law was promulgated on January 20, 2025 (Employment Service Act, 2025). Related implementing rules and supporting measures were announced to take effect on August 1, 2025 (Ministry of Labor, 2025b). Under the revised framework, certain applicants, most notably persons aged 80 and above and those aged 70 to 79 with stage II cancer or above, may hire foreign live-in caregivers without medical-institution professional assessment. This sequence sharpened an existing political cleavage between expanding household access to migrant caregivers and strengthening publicly organized care infrastructure.

This legislative process provoked sustained civil society opposition. Migrant worker organizations, women’s groups, and care worker unions argued that loosening hiring requirements would deepen dependence on weakly protected household labor rather than strengthen public care capacity (Awakening Foundation, 2024). Their critique was not simply procedural. It advanced an alternative model of care governance: if public LTC services remain insufficient, the state should expand regulated public and community-based care rather than normalize a parallel labor regime with weaker protections. In this sense, the controversy was not only about access to migrant caregivers, but about the future institutional form of long-term care in Taiwan.

The contrasting approaches of Taiwan and Japan offer an illustrative contrast, rather than a full comparative analysis, of the political choices embedded in care migration regimes. While Taiwan has positioned live-in migrant caregivers as “unskilled” household workers outside the formal care system, Japan has maintained a skilled-migration regime that channels foreign care workers primarily into institutional and regulated employment settings through formalized skill certification pathways (Lan, 2022). The comparison highlights how states classify, certify, and incorporate migrant care labor into formal care systems, even as both face aging-driven pressures that make care labor politics increasingly central to health governance.

Taiwan’s health politics is best understood not simply as a success story of universal insurance, but as a field organized by two durable tensions: technocratic cost containment versus electorally driven expansion in NHI, and public care provision versus household-based migrant labor in LTC. Recent LTC 3.0 planning strengthens the public track through medical-care integration, but leaves open whether expanded services will reduce or merely coexist with household migrant care. These cleavages help explain why institutional expansion has not fully resolved fiscal and labor contradictions. Partisan competition has encouraged visible policy commitments while discouraging costly restructuring, and civil society actors advocating migrant worker rights and gender equity remain persistent, if unevenly influential, challengers. Taiwan’s future trajectory will depend not only on demographic pressure and fiscal capacity, but on whether care is consolidated as a regulated social service or continues to rely on a stratified household labor regime.

Four research gaps warrant attention. First, the political economy of NHI premium negotiations remains under-explored, especially provider lobbying, NHI Committee deliberations, and Executive Yuan approval. Second, the intersection of immigration policy and care politics requires comparative welfare-state analysis because Taiwan’s reliance on migrant household caregivers shapes public LTC development. Third, Taiwan’s LTC trajectory, including the transition to LTC 3.0, should be compared more systematically with South Korea and Japan across financing, service delivery, and aging politics. Fourth, the coalition politics surrounding migrant caregiver regulation, involving women’s organizations, disability rights groups, and labor unions, deserves closer study as a form of intersectional advocacy in democratic developmental states.

Notes

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