Patient Brokerage Exploiting Indemnity Insurance... Group Collected 3.6 Billion Won in Kickbacks

A group, including medical professionals, who brokered patients to medical institutions and collected tens of billions of won in kickbacks, has been apprehended by the police.

The Seoul Metropolitan Police Agency's Criminal Mobile Unit announced on the 12th that they have arrested 46 brokers from a mediation organization and 31 individuals related to medical institutions on charges including violations of the Medical Service Act. Among them, two individuals, including the head of the mediation organization, Mr. A, were detained. Seoul Metropolitan Police Agency

The Seoul Metropolitan Police Agency's Criminal Mobile Unit announced on the 12th that they have arrested and referred for prosecution 46 brokers from a mediation organization and 31 individuals related to medical institutions on charges including violations of the Medical Service Act. Two individuals, including the head of the mediation organization, Mr. A (in his 50s), have been detained.

According to the police, from June 2021 to May this year, Mr. A and others are suspected of brokering patients to 20 medical institutions a total of 3,586 times, generating 13.7 billion won in medical fees, and collecting 3.6 billion won as so-called "reverse kickbacks."

Mr. A established a multi-level mediation organization, creating a system where members could be promoted to higher ranks based on their patient referral performance. The number of members reached approximately 3,000. It was found that top-performing members were incentivized with offers such as overseas trips with family or luxury vehicles.

The mediation organization was mainly composed of former insurance planners and exploited the indemnity insurance system. They signed contracts with medical institutions that provided high-cost, non-insurance treatments such as cataract surgery, Mammotome (breast tumor removal), and HIFU (uterine fibroid treatment), which could cost up to 10 million won, and referred patients to these institutions. They would check in advance whether patients had indemnity insurance and what their coverage limits were, ensuring that treatments were provided within the insurance payout limits.

The mediation organization drafted agreements with medical institutions and disguised them as legitimate advertising agency or member discount agreements. They issued tax invoices under the name of "advertising fees" and exchanged kickbacks. A police official explained, "This organization, by brokering patients, could cause non-insurance treatment costs claimed through indemnity insurance to be inflated, potentially leading to an overall increase in insurance premiums."

Mr. A and others are also facing charges of extortion and attempted extortion. In December last year, they visited a clinic and threatened, "If you do not refund the medical fees of patients whose insurance claims were denied, we will report your patient brokerage activities," and extorted 2,129,000 won. In June this year, after the police investigation began, they also threatened a hospital official, saying, "If you do not lend us 10 to 30 million won for legal fees, who knows what will happen to your hospital," but the attempt was unsuccessful.

A police official emphasized, "Brokering or introducing patients for profit is punishable under the Medical Service Act," and added, "If someone introduces you to a specific medical institution claiming that a certain treatment will be covered by indemnity insurance, this may constitute patient brokerage, so special caution is needed."

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