Man spends 995 days in hospitals in insurance scam

GWANGJU, South Jeolla - A 56-year-old man surnamed Oh went to a local hospital here in August 2008 to get a health checkup on his heart.

However, the chubby old man was different from other patients - he hoped some minor heart disease, such as angina, would be detected so that he could be hospitalized, in order to earn insurance money.

Despite his expectations, he was found to have no heart illness. Disappointed, he flew to China three months later and had the same inspection at a local hospital in Dandong, in northeastern China.

There, he lied to Chinese doctors that he couldn’t breathe well, and the doctors hospitalized him for 37 days. Finally, Oh earned a total of 48 million won ($42,723).

In Korea, the state-run health insurance pays most of the medical cost when a patient is hospitalized. Besides the state-run insurance coverage, patients can be reimbursed for the cost of surgery or hospitalization incurred if the patient has a private health insurance policy.

Using the loophole, Oh had been hospitalized in numerous Korean and Chinese hospitals 29 times for 995 days since September 2003, obtaining 840 million won of insurance money in total.

The Gwangju Metropolitan Police Agency said Thursday that they are questioning him on suspicion of insurance fraud. It’s the first time that a Korean has earned insurance money through foreign hospitals.

According to the police, Oh bought 16 private health insurance plans from Korean companies between 2002 and 2003. The insurance plans mostly cover up to 2.8 million won per month for hospitalization.

At the time Oh, who once worked in the shipping industry in China, was unemployed.

He managed to pay the insurance fees by taking out a loan. Starting in September 2003, he was hospitalized with degenerative arthritis and earned insurance money, even though he wasn’t severely sick.

However, he couldn’t stay in the hospital with arthritis forever. The insurance companies only cover hospitalization for 190 days at the maximum, for each disease. From 2004, he started to search for Chinese hospitals, noticing Korean insurance companies weren’t aware of the specifics of overseas hospitalization.

After he was hospitalized with arthritis for another 190 days at a Chinese hospital, he needed a new disease. He visited hospitals again and again for different kinds of diseases.

Insurance companies and the state financial watchdog began to suspect his abnormal hospitalization record and reported it to police. Oh confessed to police that he “wanted to earn as much insurance money as he could.”

Lee Gyeong-hyeon, a police official at the Gwangju Metropolitan Police Agency said, “We assume that there could be cases similar to Oh’s, so we are planning to cooperate with Interpol and the state financial watchdog to catch them.”

By Yoo Ji-ho [heejin@joongang.co.kr]