Korea loosens leash on medical outfits’ for-profit businesses

Medical corporations in South Korea are now allowed to set up subsidiaries and run commercial businesses, such as tourism programs and hotels specifically targeting patients from overseas, the Ministry of Health and Welfare said Tuesday.

Medical outfits are currently allowed to run parking lots and funeral services, as well as restaurants for patients and medical staff as far as their affiliated, profit-making enterprises are concerned.

According to the revised bill, medical clinics can now open inside “meditels,” local hotels for foreign medical tourists, starting in August.

Under the revision, medical companies will be able to run facilities such as fitness centers, public bathhouses and venues for international medical conferences. They can also produce, repair or sell technical aid for the disabled, the ministry said.

“Other non-profit corporations such as education institutions have been making profits without a lot of restrictions. For example, universities run university hospitals,” said the ministry in a statement.

“The old system didn’t really accommodate the demand of local corporations who wanted to bring as many foreign patients as possible.”

The revised bill also offers some 2,600 additional patient rooms in a total of 43 general hospitals nationwide for foreign patients. Up until now, foreign patients were only allowed to take up to 5 percent of hospital rooms. According to the new bill, patients from overseas who use single patient rooms will be excluded from the previous mandate. The ministry said single patients’ rooms were not very popular among local patients.

“This way, we can bring more foreign patients without affecting local patients and their needs,” it said.

The number of foreign patients climbed by 36.9 percent in 2013 from the year before. From 2009 to 2013, some 630,000 patients from overseas visited Korean medical institutions, spending some 1 trillion won ($984 million).

The ministry’s announcement, however, received criticism from local NGOs and medical activists.

“Most of the subsidiary businesses the government is allowing have nothing to do with medical services,” said Korean Federation Medical Activist Groups for Health Rights, a group of physicians and pharmacists.

“They are making medical clinics to be part of big-sized shopping malls. This only encourages hospitals to become commercial corporations (not public service organizations),” the group said.

By Claire Lee (dyc@heraldcorp.com)