Lee Chan-jin, governor of the Financial Supervisory Service, said the regulator will move quickly to refer medical institutions suspected of insurance fraud to prosecutors and respond forcefully.
The FSS signed a memorandum of understanding with the Health Insurance Review and Assessment Service on the 16th to stamp out insurance fraud and improper billing by medical institutions. The move comes as concerns grow over leakage from both public and private insurance funds, with fraud involving indemnity health insurance and auto insurance and improper billing by care providers continuing in recent months. "If we detect signs of insurance fraud at a medical institution that has filed improper claims, we will refer the case to investigators swiftly to make an example of it," Lee said.
The FSS and HIRA plan to step up information sharing to detect such crimes. The two bodies will use claims and payment data from indemnity health and auto insurance to jointly respond to warning signs such as excessive treatment, and will tighten monitoring of hospitals and clinics that violate auto insurance medical fee standards.
They will also expand exchanges of expertise and personnel in areas including insurance fraud, auto insurance claims review and improper billing of health insurance benefits. The two organizations plan to run a working-level consultative body to review implementation.
Insurance fraud cases involving medical institutions have been uncovered one after another. A traditional Korean medicine hospital in Busan was referred to prosecutors on suspicion of taking insurance payouts by disguising herbal tonics, which are not eligible for indemnity insurance reimbursement, as expensive non-covered (uninsured under the national health insurance) treatments that qualify for reimbursement. A large traditional Korean medicine hospital in Daegu is also suspected of luring auto insurance patients by advertising that it could arrange concussion diagnoses and offering discounts on uninsured care, and a major property and casualty insurer is moving to file a criminal complaint. (See pages 1 and 2 of the Sept. 15 edition of this newspaper.)
