[50 Trillion KRW Loss in Indemnity Insurance] Revising Non-Covered Payment Standards... Urgent Need to Prevent Insurance Payout Leakage

Catching Over-treatment in Manual Therapy and Cataracts
"Non-reimbursable Review Strengthening and Medical Fee Public Discussion Needed"

[Asia Economy Reporter Oh Hyung-gil] Financial authorities are set to drastically revise the insurance payout criteria for non-reimbursable excessive treatment items under indemnity insurance. Cataract surgery and manual therapy, which are considered the main culprits of indemnity insurance deficits, are the primary targets. Given the controversy over non-reimbursable treatment fees, the insurance payout system will be completely overhauled, and investigations and prosecutions against medical institutions that encourage medical shopping are expected to be strengthened.

According to the insurance industry on the 20th, the financial authorities plan to deliver their final opinion on the indemnity insurance premium increase rate at the upcoming public insurance council meeting, expected next week, by discussing with health authorities the windfall benefits of indemnity insurance due to the strengthening of health insurance coverage.

Earlier, since July, the authorities have formed a task force (TF) to prevent leakage of non-reimbursable indemnity insurance payouts and are currently discussing measures to strengthen the review of insurance payouts for non-reimbursable treatments. A 'Policy Council for Sustainable Indemnity Insurance,' involving the Life Insurance Association, the General Insurance Association, the Insurance Development Institute, and the Insurance Research Institute, has also been established. The council will soon begin reviewing improvement plans for indemnity insurance and management measures for non-reimbursable items.

The reason why the authorities and various councils must operate is due to the serious deficit of indemnity insurance. Public opinion has also intensified that excessive treatment of non-reimbursable items, which have been identified as the main cause of indemnity insurance deficits for several years, must be eradicated. Cataract surgery and manual therapy are representative examples.

Financial Services Commission Chairman Ko Seung-beom and other Cabinet members are attending the Cabinet meeting held at the Government Seoul Office in Jongno-gu, Seoul on the 9th. The Cabinet meeting was conducted as a video conference presided over by President Moon Jae-in. Photo by Kim Hyun-min kimhyun81@

The insurance industry suggests that submitting accurate diagnoses through slit-lamp microscopy examinations is necessary. The slit-lamp microscope is a basic ophthalmic device used for examining the external and anterior parts of the eye and can determine the presence of cataracts. Currently, it is not subject to mandatory record storage and is cited as a cause of excessive treatment.

If the system related to slit-lamp microscopy examinations is revised, it is expected that a significant portion of the medical shopping bubble related to cataracts will be eliminated. The authorities made the non-reimbursable cataract examination fee reimbursable in September last year. However, some medical institutions still exploited the policy to strengthen medical coverage by significantly raising the prices of multifocal lenses through loopholes, thereby securing private profits.

There is also a possibility that measures to significantly strengthen investigations and prosecutions regarding insurance fraud, such as false medical records, will be included. The industry is also calling for public disclosure of medical costs, which vary greatly by institution. The average price of multifocal lenses is higher at clinic-level institutions than at tertiary hospitals, and price differences between clinics exceed twofold.

Experts propose establishing a neutral professional review institution to set indemnity insurance compensation standards. Germany has introduced a standard price system for non-reimbursable items applied to private health insurance, requiring medical institutions to reach prior agreement with insurers if they intend to apply prices above the standard price.