Decision by Health Ministry hints at introduction of for-profit hospitals


The government has recently allowed foreign medical doctors, dentists and nurses to work at foreign medical facilities to be established in Incheon Free Economic Zone, but not at non-profit hospitals.

Only doctors who have been trained in Korea are allowed to work outside free economic zones.

The move is an indication that the Ministry of Health and Welfare will allow the establishment of for-profit hospitals in FEZs.

According to the ministry Wednesday, it revised the rules on condition of the approval of foreign medical licenses on Aug. 22, which take effect only by public notice, to allow foreign medical doctors, dentists and nurses to work in such medical facilities in the Incheon Free Economic Zone as long as their certificates are proven to be genuine.

Ministry officials explained that the conditions have been specified upon request from the IFEZ operators, who were concerned that Songdo, the main place of the IFEZ, has yet managed to attract any foreign investors in the medical field.

Medical tourism is seen as a growth opportunity by President Lee Myung-bak’s administration.

“Recently, a consortium of multinational investors has taken Songdo into consideration but said the relevant rules are too vague,” a ministry official said.

“So, we had to specify some qualification and approval process to facilitate the process. The content of the public notice was modeled after the Jeju free economic zone, where details about the establishment of for-profit hospitals have been drawn up in 2008,” he said, adding that there had been “minor” opposition from doctors but the overall reaction was rather calm.

However opposition from Jeju residents has meant that no for-profit hospitals have been set up there.

Civic groups argue that profit-oriented hospitals will polarize medical services between those for the wealthy and those for the poor.

In Korea, individual schools, religious groups and other non-profit organizations are allowed to run hospitals as nonprofit organizations. Though the law strictly limits the location of profit-oriented hospitals, which can only be established by foreign investors or joint ventures with foreign investors, to six free economic zones set up to draw foreign investment, opponents argue that for-profit hospitals will have a strong impact on the wider Korean medical system.

The Korean Federation of Medical Groups for Health Rights estimates that the establishment of for-profit hospitals will increase medical bills by 20 percent because unnecessary tests will be provided to patients. They also say that high salaries offered to doctors by large commercial hospitals will lure skillful doctors from non-profit ones where they currently work. Such public concern has hindered the government from pushing the program even inside the IFEZs.

On Wednesday, the government reaffirmed that no profit-oriented hospitals will be allowed inside Korean territory except for the designated zones.

“However, in the IFEZ, it is a totally different story. In order to induce foreign patients to choose Korea over other destinations, we will ease some regulations and give more perks to the investors,” a ministry official said.

By Bae Ji-sook (baejisook@heraldcorp.com)