[Why&Next] Inflated Examination Fees and Manipulative Hospitalization... Cataract Insurance Claims Amid Controversy

Increase in Rulings Rejecting Manipulative Hospitalizations
Inspection Costs Inflated 19 Times... Hospital Negligence Also Recognized
Overtreatment Must Be Reduced Alongside Unjust Nonpayment

Claims for cataract-related indemnity insurance payments are once again under scrutiny. The industry and consumers are increasingly at odds, each accusing the other of 'tricky' insurance claims and unjust denial of payments. This issue has even prompted Lee Bok-hyun, Governor of the Financial Supervisory Service, to announce plans to revise insurance payment guidelines during this month's National Assembly audit. While unjust denial of insurance payments should be reduced, there are calls for transparent insurance payment standards, as courts do not recognize excessive medical treatment that appears even under strengthened reviews.

According to the industry on the 25th, Governor Lee stated at the National Assembly's Political Affairs Committee audit held on the 17th at the Financial Supervisory Service in Yeouido, Seoul, regarding the controversy over eligibility for cataract insurance claims, "We are revising the system so that insurance companies can dispute payments made in cases involving elderly patients or those requiring treatment at higher-level hospitals," adding, "We will establish reasonable standards in cooperation with the Financial Services Commission and related associations and announce them within the year." This has drawn attention from both the industry and consumers, especially as they closely watch recent precedents and remain alert to potential system changes.

Cataracts are considered a representative area of indemnity insurance leakage, where brokers and hospitals systematically engage in excessive medical treatment to claim indemnity insurance payments. Some hospitals have even advertised that patients can receive insurance payments worth tens of millions of won by combining multifocal lens implantation for vision correction, which is not treatment, with inpatient care, thereby recruiting patients.

Hospitalization Still Not Recognized... Trend to Prevent Excessive Treatment

Recent court rulings have confirmed such excessive medical treatment and have increasingly issued judgments to prevent unjust insurance payments. The Ministry of Health and Welfare's notice states that hospitalization cannot be recognized solely based on 'observation at the hospital for more than 6 hours' or 'hospitalization opinion.' On the 10th, the Seoul Central District Court (Judge Lee Ju-yeon) ruled in favor of a major non-life insurer, Company A, in a lawsuit against Gangnam G Eye Clinic, ordering the return of insurance payments made due to excessive treatment. The court ordered the return of 68.28 million won out of the 84.21 million won claimed by patients treated at G Eye Clinic.

The court pointed out that while the insurance claims were not coerced by the eye clinic but decided by the patients themselves, the clinic issued false documents claiming inpatient treatment. Although patients stayed at the hospital for about 1 to 4 hours and 30 minutes, the hospital falsely recorded that they stayed for more than 6 hours, which is the requirement for inpatient treatment. A similar ruling was made in August. In a lawsuit where patient C sued Samsung Life Insurance for cataract surgery insurance payments, the plaintiff lost. C underwent artificial lens implantation for senile cataracts at G Eye Clinic and claimed insurance payments worth about 12 million won for inpatient treatment. The key issue was whether hospitalization occurred. G Eye Clinic recorded that C stayed about 6 hours and 30 minutes for each of two surgeries, but the court did not recognize this as hospitalization and ordered payment of only about 400,000 won corresponding to outpatient treatment costs.

Rulings Recognizing Hospital Faults

There are also rulings pointing out hospital negligence. On the 5th, the Seoul Eastern District Court ruled that defendant Gangnam E Eye Clinic must pay about 10 million won to plaintiff D, who filed a lawsuit claiming vision deterioration after cataract surgery at E Eye Clinic. The court found that E Eye Clinic did not sufficiently explain the side effects.

The 22nd Civil Division of the Seoul High Court overturned a first-instance ruling against an insurer in an appeal filed last month against F Eye Clinic, ordering payment of about 220 million won. The court found that F Eye Clinic, while performing cataract surgery, supplied multifocal intraocular lenses?which are not covered by indemnity insurance?at prices lower than cost but abnormally inflated various examination fees by up to 19 times.

'The War Against Cataracts' Expected to Continue... Need for Transparent Standards

As rulings on insurance payments and returns are mixed, there are calls for more detailed and transparent standards from authorities. Since cataract surgery is already a major source of insurance leakage, this could lead to increased premiums for honest policyholders. According to the industry, indemnity insurance payments related to cataract surgery surged from 430 billion won in 2019 to 951.4 billion won in 2021. Insurance claims sharply declined only after the Supreme Court ruled in June last year that cataract surgery is outpatient treatment, not hospitalization. Nevertheless, this year, some Gangnam eye clinics were caught fabricating complications and duplicating medical records to inflate non-reimbursable medical fees.

An industry insider pointed out, "Although rulings on cataract-related lawsuits vary depending on individual cases, hospitalization is generally not recognized following the Supreme Court ruling. Medical negligence is acknowledged in lawsuits between hospitals and patients over reoperations due to sequelae after cataracts, and there is an increasing number of cases where patients undergo surgeries at excessive costs relying solely on hospitals, leading to disputes with insurers. Consumers need to be cautious."