Supreme Court: Illegal Hospital Operator May Be Held More Liable Than Name Lender

원본보기 아이콘

The Supreme Court has ruled that a person who illegally operated a hospital (commonly referred to as a "proxy operator") may be required to pay more money than the entity that lent its name to the hospital (the medical corporation).

According to the legal community on April 20, the Supreme Court (Presiding Justice Noh Kyung-pil) partially overturned the lower court's decision in the case regarding the cancellation of the disposition to recover medical care benefit payments and sent the case back to the appellate court for retrial.

This case involved a situation where the medical corporation that owned the hospital's name and the individual who actually operated the hospital were not the same. In this case, a non-physician operated the hospital and received health insurance payments, which is the so-called "proxy hospital" structure.

The National Health Insurance Service (NHIS) deemed this illegal and decided to recover the medical care benefit payments that had been made. Initially, the NHIS sought to recover approximately 17.4 billion won, but later reduced the amount to around 6.6 billion won. The NHIS demanded payment from both the medical corporation that owned the hospital's name and the actual operator.

The key issue was how much responsibility the actual operator should bear. The courts of first and second instance held that the actual operator could be held liable, but not for more than the amount imposed on the hospital. In other words, if the hospital was ordered to pay 10 billion won, the actual operator would be liable for up to 10 billion won at most.

However, the Supreme Court took a different view. The Supreme Court saw the actual operator not merely as someone jointly responsible with the hospital, but as a separate party with independent liability. Therefore, if the actual operator gained more profit or bore greater responsibility through the hospital, he or she could be required to pay more than the hospital itself.

The Court also ruled that such recovery decisions fall under the discretionary judgment of the administrative authority, which can determine the amount based on the circumstances. The amount to be collected may be set differently depending on who was involved and how much profit they obtained. Meanwhile, the existing position was maintained that the recovery target includes not only the money paid by the NHIS, but also the patient's out-of-pocket expenses. The Supreme Court found fault with the lower court's decision that limited the actual operator's liability under these standards and ordered a retrial.

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