FSS busts crooked clinics

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FSS busts crooked clinics

In November, the Gyeonggi police investigated a traditional medicine clinic after becoming suspicious about its owner.

The clinic had been opened under a doctor’s name, but police soon discovered it was actually owned by its administrator, who had been using the clinic to commit insurance fraud.

By law, only someone with a license to practice medicine is allowed to open a clinic or private hospital.

The administrator, whose name was not made public, had been charging insurers for treatments that were never performed and overcharging on treatments that actually took place.

In the process, he had pocketed 530 million won ($478,200) from private insurers and 1 billion won from the government’s health plan.

But this was not the office manager’s only scheme. In the same building, he had opened another clinic in the name of a different doctor, pocketing an additional 280 million won from private insurers and 590 million won from the government.

On Wednesday, the Financial Supervisory Service (FSS) unveiled the results of its investigation into 57 fraudulent clinics.

According to financial authorities, the most common schemes were similar to the one in Gyeonggi, in which an administrator would open two or more clinics in the same building.

It is also illegal for a doctor to open up multiple clinics unless he or she has multiple licenses in different fields. Even then, they are only allowed to open up to two different centers.

Some administrators admitted patients for lengthy stays to treat minor injuries, staying ahead of authorities by shifting patients to different clinics in the same building.

In several cases, administrators paid elderly doctors huge sums of money to use their names.

In one, an 81-year old doctor received 5 million won for lending his name to a phony clinic.

Other administrators opened fraudulent senior care centers because the long-term treatments brought them a steady paycheck.

Under the medical law, doctors involved in the scheme could get their medical licenses suspended.

The administrators that opened clinics and the doctors who either lent their names or opened up clinics themselves can face up to five years in prison or a fine of up to 20 million won.

Doctors who worked at a hospital owned by an administrator will be fined up to 3 million won, with higher penalties leveled against those involved in defrauding the national health insurance.

Under insurance law, perpetrators of fraud face up to 10 years in prison and a fine of up to 20 million won.

By LEE HO-JEONG, PARK JIN-SEOK [lee.hojeong@joongang.co.kr]
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