"Worst Since Opening 53 Years Ago"… Kyung Hee Medical Center Considers Suspending Salary Payments

Kyunghee Medical Center Director Sends Email to Staff
"Cost-Cutting Efforts to Overcome Management Crisis Also Have Limits"

As the medical gap caused by the increase in medical school admissions continues for nearly three months, university hospitals have been pushed to the brink due to worsening financial difficulties.

Kyung Hee Medical Center, which oversees seven hospitals including Kyung Hee University Hospital, the only tertiary hospital in Dongdaemun-gu, Seoul, and Gangdong Kyung Hee University Hospital, is reportedly considering suspending salary payments and implementing voluntary retirement starting next month due to daily deficits amounting to hundreds of millions of won.

Quiet Weekend Outpatient Clinic, Children Patients Walking in the Hospital
Photo by Yonhap News

On the 5th, Newsis reported that Oh Ju-hyung, director of Kyung Hee Medical Center and president of Kyung Hee University Hospital, sent an email titled "To All Kyung Hee Medical Center Staff" on the 30th of last month.

In the email, Director Oh stated, "The government and the medical community have been running on parallel lines without finding a solution, and as the medical crisis enters its 11th week, it is heading toward a catastrophe. The difficulties in the medical field are intensifying daily, and medical institutions are all considering the situation as equivalent to a disaster or wartime, each struggling to devise countermeasures."

Earlier, Kyung Hee Medical Center had already switched to an emergency management system in March, but it is reported that daily deficits of hundreds of millions of won have continued since then.

Director Oh said, "Despite the medical center's decision to switch to an emergency management system in March and the active cooperation and participation of everyone in implementing current measures, the daily losses in the hundreds of millions of won have accumulated, resulting in the worst financial crisis in the 53 years since its founding, seriously threatening the survival of the medical center."

He added, "Simulation results predict that if the current situation continues, the funds required for various payments, including individual salaries, will be massively insufficient by the end of this year. We are facing a critical situation where we must consider suspending salary payments and voluntary retirement starting as early as June this year."

On the morning of the 3rd, medical staff and patients are resting at a large hospital in downtown Seoul.
[Photo by Yonhap News]

He continued, "To overcome the management crisis, we are making efforts to reduce costs through unpaid leave, cutting position allowances, returning faculty performance bonuses, across-the-board cuts in administrative and operating expenses, and reducing capital investments, but there are limits. Currently, the possibility of securing external funds is very uncertain, and borrowing funds will always be an obstacle to the future growth of Kyung Hee Medical Center, passing great pain on to future generations."

Director Oh appealed, "The management will strive to normalize operations as soon as possible so that staff can work in a good environment. Please join us in making every effort for the survival of the medical center before reaching an irreversible situation."

Earlier, Inje University Sanggye Paik Hospital also sent a 'Salary Return Agreement' to all medical school professors in March, asking them to return their salaries for the next six months. The return amounts were set at 480,000 won, 1,160,000 won, or voluntary choice.

Amid ongoing legislative conflicts, a hospital official is walking at a university hospital in Seoul on the 5th.
[Photo by Yonhap News]

Deficits in large hospitals are becoming a problem regardless of whether they are in the metropolitan area or non-metropolitan areas. Seoul National University Hospital doubled the limit of its overdraft account from 50 billion won to 100 billion won at the end of March and is accepting unpaid leave applications from staff, mainly ward nurses. Severance Hospital is also implementing seven days of unpaid leave for all employees except doctors.

Jeju National University Hospital, the only national university hospital in the Jeju region, declared an emergency management system on the 30th of last month after expecting a deficit of over 60 billion won following the collective resignation of residents.

Meanwhile, professors from 19 medical schools nationwide are planning to go on strike on the 10th by suspending outpatient care and surgeries, and are taking a tough stance daily, demanding the government to clearly disclose the evidence supporting the increase in medical school admissions.