[Reporter’s Notebook] Simplifying Silson Claims, Don’t Become the Boy Who Cried Wolf Again

There is a prospect that the amendment to the Insurance Business Act related to simplifying claims for indemnity health insurance will be discussed at the Legislation and Judiciary Committee's bill review subcommittee on the 25th. This is the eighth attempt this year alone. Since the recommendation by the Anti-Corruption and Civil Rights Commission in 2009, the subcommittee of the Legislation and Judiciary Committee has convened more than 160 times over 14 years, but it has never even passed the threshold. The expectation that "this time is different" turned into disappointment, and the industry and media have become "crying wolf."

Although the insurance industry has been experiencing a "digital" wave for several years, indemnity insurance, which already has nearly 40 million subscribers, is an exception. Patients still receive non-reimbursed treatment records as paper documents and must go through the unnecessary process of sending them again by fax. Insurance companies also face a tedious procedure. They repeatedly input the received paper documents into their systems and enter the insurance claims. The core idea of simplifying indemnity insurance claims is to computerize this process so that claims can be made easily after treatment.

If indemnity insurance claims become easier, the 40 million subscribers are more likely to file claims. Even if they claim just 20,000 KRW more per year, nearly 1 trillion KRW in insurance payments would be required. Indemnity insurance is already a perennial deficit business for insurers. Since financial authorities view indemnity insurance as a kind of social safety net, premiums cannot be raised arbitrarily. It can serve as a bait product to attract customers to other insurance products, but the cost might outweigh the benefits.

Nevertheless, insurance companies actively support simplifying indemnity insurance claims. They judged that the costs associated with various paper documents are greater than the losses caused by increased insurance payments. In an era of extreme efficiency, reducing manpower and time spent on unnecessary tasks is seen as more beneficial.

Consumers also want this. According to a survey conducted by the Green Consumer Network, Consumers Together, and the Financial Consumers Federation, 47.2% of indemnity insurance subscribers said they gave up on filing claims. Reasons included small amounts, failure to gather various documents, and the hassle of submitting proof documents. In short, filing claims was inconvenient.

Despite the desires of the industry and consumers, the bill has not passed, which is interpreted as the political sphere being overly conscious of the "votes" of the medical community centered on hospitals and clinics. In May last year, the Presidential Transition Committee included "simplifying indemnity insurance claims" as part of implementing a digital platform government. However, it was omitted from the 110 national tasks announced shortly after, and there has been no further mention since. The ruling party also emphasized prioritizing the computerization of indemnity insurance during the February extraordinary session of the National Assembly, but ultimately nothing happened.

Hospitals and clinics nationwide strongly oppose the transmission of non-reimbursed treatment details to information relay agencies such as the Health Insurance Review and Assessment Service. However, this medical community opposition is not the only public sentiment. The inconvenience to the public is also a concern. Related services by Toss and KakaoPay, which are affiliated mainly with large hospitals, are already operating smoothly. The hard-to-justify selective public sentiment will likely fail to gain either legitimacy or votes.

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