Eighteen Medical Institutions Exposed for 'Payback' and Irregular Treatments Within One Month of Crackdown

Ministry Confirms Patient Enticement Methods Including Non-Insurance Packages and Abuse of Actual-Loss Insurance Policies

Immediate Referral to Police Upon Receiving Reports

"Strict Response to Medical Law Violations"

The Ministry of Health and Welfare has referred an additional 12 medical institutions suspected of offering so-called 'paybacks'—partial reimbursements of medical expenses to cancer patients—to the police for investigation. Less than a month after the launch of the 'Irregular and Fake Treatment Administrative Investigation Team,' the total number of medical institutions referred for investigation has increased to 18.

The Ministry of Health and Welfare announced on July 15 that, after analyzing the reports received by the 'Irregular and Fake Treatment Report Center,' which the Administrative Investigation Team has been operating since June 18, it has determined that 12 medical institutions, believed to be highly credible cases requiring urgent investigation, have been additionally referred to the police. As of July 13, the report center had received more than 50 reports.

This referral includes 5 convalescent hospitals, 6 Korean medicine hospitals, and 1 clinic. Regionally, 2 are located in the Seoul metropolitan area, 5 in the Gyeongsang region, and 5 in the Jeolla region, covering a nationwide distribution.

Paybacks refer to the illegal practice where a medical institution offers partial refunds of treatment fees or provides financial benefits to attract patients. Such actions violate the Medical Service Act’s ban on patient enticement and brokerage and are subject to up to three years in prison or a fine of up to 30 million won.

The Administrative Investigation Team explained that, during their analysis of the reports, they identified various forms of illegal patient enticement that go beyond simple refunding of treatment fees. These included operating non-insurance package deals, abuse of actual-loss insurance policies, and providing both cash and in-kind incentives.

In one hospital, staff were found to be running non-insurance package programs customized according to the length of hospitalization, requiring medical staff to provide care in line with these packages. There is also evidence that patients with actual-loss insurance policies were refunded the equivalent of the statutory co-payment amount. In another case, a hospital administrator allegedly proposed payback conditions to patients and was suspected of making false or excessive claims for treatment costs, after which 20–40% of the payment was refunded in cash or provided in the form of health supplement vouchers.

Other identified cases included issuing receipts for amounts higher than the actual payment to allow patients to claim more from their insurance, as well as providing discounts on treatment costs while informing inpatients that they could take unrestricted leave or stay overnight outside the hospital.

The Administrative Investigation Team will continue conducting on-site administrative investigations of medical institutions nationwide. If credible reports of violations such as paybacks or the operation of unauthorized nurse-staffed hospitals are received, the police will be immediately asked to investigate, ensuring that administrative and criminal investigations are conducted simultaneously.

Last week, on-site investigations were carried out at six hospitals and clinics in the metropolitan area, North Gyeongsang, South Jeolla, and North Chungcheong provinces. Follow-up actions based on the findings of these investigations are to be determined shortly.

Additionally, if violations go beyond breaches of the Medical Service Act and include violations of medical ethics guidelines, the Ministry will work with organizations such as the Korean Medical Association, Korean Hospital Association, and Korea Association of Geriatric Hospitals to submit cases for expert review and possible referral to the respective organizations’ ethics committees.

Gwak Soonheon, head of the Irregular and Fake Treatment Administrative Investigation Team, stated, "The ban on patient enticement and brokerage is a fundamental principle of the Medical Service Act, designed to protect the professional judgment of medical practitioners and appropriate treatment choices for patients. We will continue to rigorously coordinate reports, on-site investigations, and cooperation with law enforcement agencies to firmly respond to any acts suspected of violating medical laws and regulations."

This content was produced with the assistance of AI translation services.