Corruption reports and whistle-blowing in the medical field helped recovery 38.3BN won of national finance

ACRC announced the result of analysis on 1,228 cases of reporting from the medical field, which had been submitted to ACRC for the past 5 years

March 27, 2018

Anti-Corruption and Civil Rights Commission

The Republic of Korea

Approximately 38.3 billion won worth medical care benefits have been recovered to the national finance, as a result of corruption reports and whistle-blowing on "manager's operation of hospitals" instead of licensed doctors, medical practices by unlicensed persons, and so on in the field of medicine, which had been submitted for the recent five years.

On the 27, the Anti-Corruption and Civil Rights Commission (ACRC) announced the result of analysis on 1,228 cases of corruption reports and whistle-blowing from the field of medicine including the cases of "manager's operation of hospitals," which had been submitted to the ACRC for the past five years since 2013.

According to the ACRC, the number of reports was largest for ▴ medical practice by an unlicensed person (37%, 456 cases), followed by ▴ false or exaggerative advertising (14%, 166 cases), ▴ establishment of a medical institution by an unlicensed person such as the "manager" of the institution (8%, 96 cases), etc.

So-called "manager's hospital" is one that is established not by a licensed medical doctor or Korean Medicine doctor but by an unlicensed individual for profit, in violation of the article 33, clause 2 of the Medical Service Act.

Out of the 1,228 reports submitted to the ACRC, 943 were responded and 591 cases were doubted as involving unlawful acts so they were transferred or sent to relevant institutions including investigative agencies.

Among them, law violation was acknowledged for 210 cases (35.5%) and they received disposition of prosecution and accusation (68 cases) and imposition of penalty surcharge or fine (14 cases).

Notably, 97 cases of "manager's hospital" were reported and the suspicion was confirmed for nine cases among them. From the confirmed charges, 37.1 billion won worth medical care benefits were recovered to the national finance.

In order to resolve the corruption problem in the field of medicine, the ACRC will actively collaborate with relevant public institutions including the Ministry of Health and Welfare, National Health Insurance Corporation, and the Police Office, to conduct joint factual surveys and institutional improvement.

In the meantime, the ACRC is operating the "Period of intensive corruption report and whistle-blowing in the medical field" from January 15 until the 15 next month this year. In a case when a reporting contributes to the public interest such as recovery of unfair profits to the national coffer, the reporter will be granted with up to three billion won of compensation money or 200 million won of prize money.

Acts that are subject to reporting include behaviors that harm people's health by violating relevant laws such as the Medical Service Act and the National Health Insurance Act, including the establishment and operation of "manager's hospitals," insurance fraud through overtreatment or false treatment on fake patients, pharmaceutical rebate, and so on.

Recently, the ACRC paid 203,069,000 won of compensation money to a person who reported a doubt over operation of a "manager's hospital" and unlawful claim of medical care benefits.

The Director General for Reports Inspection of the ACRC said, "The issue of corruption in the medical field not only undermines the national financial soundness and but also could harm people's health from poor quality of medical service lowered by problems such as overtreatment. As it is difficult to reveal corruption in the medical field such as the case of 'manager's hospital' if it is not reported by an internal whistle-blower, what is most important is active reporting."