The current healthcare system in Taiwan, known as National Health Insurance (NHI, ), was instituted in 1995. NHI is a single-payer compulsory social insurance plan that centralizes the disbursement of healthcare funds. The system promises equal access to healthcare for all citizens, and the population coverage had reached 99 per cent by the end of 2004. NHI is mainly financed through premiums, which are based on the payroll tax, and is supplemented with out-of-pocket co-payments and direct government funding. Preventative health service, low-income families, veterans, children under three years old, and catastrophic diseases are exempt from co-payment. Low income households maintain 100 per cent premium coverage by the NHI and co-pays are reduced for disabled or certain elderly people.