Words by Michael Song
At the turn of the 21st century, a new industry began to grow at a tremendous rate due to rapid dissemination of information through the Internet and overall increases in international travel. People were traveling across borders internationally for the main purpose (sometimes sole purpose) of seeking medical treatment. Sometimes this was due to new medical advances made in other countries but the most popular reason was due to lower costs. For example, in 2009 the cost of coronary artery bypass surgery was $144,000 in the U.S. while it was $24,000 in Korea. Many patients from the U.S. and Europe were heading to Malaysia, Thailand, India and Singapore to meet their medical needs at a fraction of the price.
While initially considered a fluke or a trend, medical tourism has blossomed into a large $438.6 billion per year industry accounting for 14% of the world’s tourism (according to a 2013 study by the Stanford International Research Institute). This trend effectively started the internationalized privatization of health care.
In 2009, the Korean government actively took steps to engage itself in the medical tourism industry. The Medical Services Act was amended to allow for hospitals and institutions to attract foreign patients through agencies and brokers, known as medical tourism agencies. This was followed by the formation of two medical visas allowing patients to stay in Korea for up to a year for extended treatment. And finally, a formal system was developed to support medical tourism and travel contracts, and to provide a safe environment for patients.
In an effort to regulate medical care, the Medical Services Act only allows hospitals and institutions to set aside 5% of their total patient care for medical tourism purposes. This is to prevent hospitals from neglecting domestic patients (covered under Korean insurance) in favor of international patients to increase profitability. Medical institutions are also required to register a license in order to utilize medical tourism agencies.
For their part, medical tourism agencies are also required to register their businesses with the Korean government. This includes an initial capital investment of W100 million and liability insurance. The insurance must be of W100 million or more and cover a period of at least one year to cover potential damages in the case of negligence or unintentional mismanagement resulting in patient harm.
Medical tourism agencies provide a total travel package including visa applications, transportation to and from the airport, hotel reservations, and sightseeing tours. Most importantly, they coordinate requests for medical records, translation services, and arbitration regarding any issues resulting from accidents in medical care. This extends to aftercare when the patient has left Korea and requires additional information or has any issues resulting from the services they received during their stay. Many agencies provide these services at no cost to the patient as agencies receive commission from hospitals. Any travel extras such as sightseeing tours, assistance, additional translation services are provided for an extra fee.
While the amendments to the Medical Services Act were made in good faith, it has becomeapparentthat the industry requires more regulatory measures. Due the sensitive nature of medical tourism, all medical tourism agencies are required by law to register their businesses with the government; however, there has still been a noted inflation of fees and lack of quality health care from a wealth of unregistered agencies catering to unsuspecting patients. Another disputed issue is the pricing for medical services provided by institutes. As the pricing for services rendered to international “medical tourists” is not covered by any specific law, it is open to interpretation. This has created a double standard when it comes to pricing for foreigners who are not covered by Korean health insurance. In some cases, prices have been reported to be 10 to 20 times more than their respective counterparts under insurance.
As a reaction to such practices, the Korean government has been planning additional amendments and guidelines to increase the quality of healthcare for international patients and crackdown on illegal agencies and practices. The government also encourages hospitals to charge their fees to the patient directly to prevent inflation by agencies in addition to forming guidelines to prevent illegalities and protect the country’s reputation as an international provider of medical services.
The current state of South Korea’s health care isn’t considered to be perfect by experts due to a number of bureaucratic factors, but to the everyday patient, the system operates well. Every resident is eligible for the National Health Insurance, regardless of nationality or profession, and has access to quality healthcare at general hospitals, oriental medicine hospitals, and clinics. While amendments to legislation as well as the availability of well-informed tourism agencies is invaluable, it is the accessibility to quality medical services at a low cost that makes Korea a prime location for medical tourism.