[Reporter’s Notebook] Medical Sector’s Stubbornness Neglecting Consumer Convenience... Simplification of Real-Expense Insurance Claims Fails Again

Simplifying Claims for Indemnity Insurance Stalled for 10 Years Due to Medical Community Opposition
Despite Support from Ruling and Opposition Parties, Financial Authorities, Consumers, and Insurers, Medical Sector Barrier Remains
Outdated Methods Unsuitable for Untact Era Cause Consumer Harm Only

Oh Hyung-gil, Financial Department Reporter

[Asia Economy Reporter Oh Hyung-gil] "The medical sector's barrier was high."

The simplification of claims for indemnity health insurance, which seemed to have no disagreement between the ruling and opposition parties in the 21st National Assembly, has once again been delayed. Insurance companies actively offered to bear the cost of building the electronic network for hospitals to send claim documents, but it ultimately failed. The 'old-fashioned claim method' lagging behind in the untact era could not be fixed.

On the 2nd of this month, the National Assembly's Legislation and Judiciary Committee discussed partial amendments to the Insurance Business Act, each proposed by Representative Ko Yong-jin of the Democratic Party of Korea and Representative Yoon Chang-hyun of the People Power Party, but failed to reach an agreement.

Indemnity insurance has 30 million subscribers and is called the "second national health insurance." However, the claim procedure is cumbersome, and there has been significant dissatisfaction among policyholders. Cases of giving up on insurance claims due to the complicated process have also been increasing.

As of 2018, 76% of the 90 million annual indemnity insurance claims were made via fax, through insurance agents, or by visiting agencies. The remaining 24% submitted paper documents via email or insurance company applications (apps). Even in these cases, insurance company employees must review the documents and manually enter the information into the electronic system.

Discussions to simplify claims electronically began with recommendations from the Anti-Corruption and Civil Rights Commission in 2009. Consumers, the insurance industry, and financial authorities all supported it, expecting it to enhance consumer convenience and reduce costs, but it was neglected due to opposition from the medical sector.

Expectations were high that this year would be different. Both ruling and opposition parties proposed amendments to the Insurance Business Act to mandate electronic claims. Considering the medical sector's opposition, Representative Ko added provisions to prevent the Health Insurance Review and Assessment Service (HIRA) from using or storing information for purposes other than document transmission and to allow the formation of a committee involving the medical sector related to transmission tasks.

Representative Yoon also proposed an amendment to provide a legal basis for delegating tasks related to building or operating the electronic system to HIRA, making bipartisan agreement seem possible.

However, the strong influence of the medical sector was once again an insurmountable barrier. Dr. Choi Dae-jip, president of the Korean Medical Association, personally visited lawmakers to convey the unfairness of the bill and the medical sector's concerns. The meeting reportedly lasted over an hour.

The National Assembly abandoned consumer convenience and yielded to the medical sector's persuasion. This bill, supported by many stakeholders except the medical sector to resolve consumer inconvenience, has been drifting for 10 years.

At the time when the simplification of claims, which consumers had high hopes for, was canceled, the ruling and opposition parties passed a bill allowing non-face-to-face medical treatment when the infectious disease crisis alert reaches the "serious stage." How should consumers view the "contradiction" that even if they receive non-face-to-face treatment, they still have to visit the hospital to claim insurance benefits?

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