South Korea's Ministry of Health and Welfare announced that it will conduct a three-month investigation from August to October, targeting medical institutions identified as having a high risk of fraudulent claims, including those suspected of operating as 'manager hospitals', which are illegally operated hospitals that are effectively controlled by non-medical investors while using licensed doctors as nominal operators.
The government will launch its first planned investigation in three years into suspected fraudulent health insurance claims as part of efforts to prevent the misuse of health insurance funds.
The ministry said it has developed 198 case-specific assessment criteria using the Health Insurance Review & Assessment Service's fraud detection system to calculate risk scores for medical institutions. Facilities assessed as having a high likelihood of fraudulent claims have been selected for investigation.
Medical institutions found to have submitted false claims will be required to repay the improperly claimed amounts and may face penalties under the National Health Insurance Act, including business suspension of up to one year, fines of up to five times the amount fraudulently claimed, public disclosure of their names and suspension of medical licences.
According to the ministry, fraudulent billing—including claims for medical services that were never provided—results in an estimated average annual financial loss of KRW9.6bn ($7m) to the national health insurance system, reported Yonhap news agency.