Health: Should You Buy Extra Medical Insurance in Korea?

By William Urbanski

If you have ever found yourself in any sort of Korean hospital, clinic, or in particular, a specialized medical practice, you have probably noticed something quite peculiar, namely, that they are almost always stuffed-tothe-gills busy. Koreans are not more prone to sickness and injury than anyone else, and Korea has a high number of hospitals per capita, so I think I speak for all of humanity when I say, “What gives?”

Korea has a very comprehensive and mandatory healthcare plan, so over the last couple of months, I was very surprised to learn about the high percentage of Koreans who purchase and carry supplementary health insurance. The next time you meet your Korean friends, try bringing up the subject and you will almost certainly find that they either have an extra healthcare plan or someone in their immediate family does. I am not going to get into the fine details of the available plans (there are too many to list), but they range from somewhat affordable to quite expensive (to the tune of a few grand a year) and cover the whole gamut of medical conditions up to and including terminal diseases. This sounds all well and good, but considering the medical plan that is in place, it is kind of curious why so many people in Korea feel the need to carry extra insurance. Further digging into this topic reveals a possible answer and an “inconvenient truth”: the Korean private insurance system is rife with fraud and abuse as a great deal of people buy insurance policies with the explicit intention of milking them for everything they are worth. There is even a special term in Korean for fakers who pretend to be sick or injured just so that they can cash in on their policies: “nylon patients” (나이롱 환자). This term is a reference to both the dubious quality of garments made with the material and the even dubious-er claims made by “patients.”

Why should anyone buy insurance in the first place? Well, simply put, it is so that if something catastrophic happens, your life, property, or livelihood will be protected. Being insured is like wearing a helmet or fastening your seatbelt in a car: It is something you do with the express hope that you never have to use it. To account for the prevalence of nylon patients, I would like to introduce a metaphor: If someone has a phone plan with 1GB of data, that person will probably be somewhat conservative on how they use it. If a person pays for a “big” data plan that has 10GB, 20GB, or unlimited data per month, he or she will certainly use it more just because it is available, and to not use it will seem like a waste. They may even be bitter about the high price they pay for it. It is the same way with insurance: If someone has a big policy, it is very tempting to use it just because it is there.

My home country, Canada, is well known for having free and universal healthcare. In theory this sounds like an excellent system, and I am not one to dispute that it is. Although Canada’s free healthcare system is the envy of many other nations (cough, cough, USA, cough, cough), it is not without its drawbacks. Namely, wait times can be long, especially for non-urgent conditions, and if you do not have a family doctor as your first point of contact, good luck navigating the complex, bureaucratic system. Instead of debating the merits of a free healthcare system, I think it is important to draw attention to one of the most salient features of Canadian society: the fact that most Canadians do not enjoy visiting hospitals and generally do whatever they can to not visit one.

Plan (NHIP) in which enrollment is mandatory. As anyone reading this surely knows, the NHIP is definitely not free (in most cases it is paid for by means of a stiff deduction out of every paycheck), but its benefits are pretty snazzy: Visiting a doctor and even the dentist is very cheap. The big drawback to this system is that a patient will almost always have to pay a certain amount “out of pocket” with every visit. This is a major reason why supplementary private insurance, which covers these out-of-pocket expenses, is extremely popular. This “two-tiered” healthcare system (which, by the way, has faced vigorous opposition in Canada at virtually every level of society), without question, clogs up hospitals by encouraging the truly lowest rung of society: the abovementioned “nylon patients.”

To understand how this works, consider the following example: If a person falls off their bike and needs a few stitches, they will wait a few hours at the hospital, pay a couple hundred bucks, get sewn up, get a prescription for painkillers, and be on his or her way. But, if the same person had comprehensive (and expensive) supplementary insurance coverage, he would start crying the blues about how hurt he is so that he can get a private hospital room for a few days and get reimbursed for missing a few days of work, in addition to being compensated for his “pain and suffering” (read: stupidity). As this example illustrates, those with supplemental insurance are eager to take advantage of the “benefits” that their insurance packages offer.

Depending on how you look at it, pretending to be sicker than you are could or could not be considered “fraud,” but it is at the very least unethical and definitely abuse of a system that is supposed to provide adequate care in extreme cases. It also represents a misunderstanding of the purpose of insurance and a normalization of unscrupulous behavior. Roughly speaking, buying insurance and then pretending to be hurt is equivalent to buying a bike helmet, then riding into a wall head-first on purpose so that your mommy will give you a kiss to make it better.

Something that no doubt factors into a nylon patient’s mental calculations is the notion that insurance companies are rich and greedy and that the nylon patient is some sort of Robin Hood-like figure for relieving them of their money. This whole Robin Hood Delusion conveniently obscures a dirty truth: Scamming the system makes everyone worse off. Think about it carefully: Even if nobody gets hurt directly, money and resources are being allocated improperly. Another scummy aspect of this whole practice is that it is the very people who can afford expensive supplementary insurance in the first place that seek to gain benefits from it. So, people with enough money to pay insurance premiums are also the ones who start feeling entitled to expensive, special treatment and are willing to cry in order to get it. Clearly, it is not so much “taking from the rich and giving to the poor” as much as it is just “stealing because you feel like it.”

In hockey, arguably the most universally despised technique of gaining an advantage is to “take a dive.” Otherwise known as “drawing a penalty,” it involves lying on the ice and crying like a big baby until the referee punishes the opposing team (sometimes by allowing a penalty shot – an almost surefire way to score a goal). Taking a dive is sportsmanship at its worst and is best left on the soccer field where it belongs. In many ways, there are many direct parallels between nylon patients and athletes who try to win by taking advantage of a system that assumes people are acting in good faith. Like hospital fraud, taking a dive in sports can be notoriously difficult to prove, especially under time pressure, something hockey referees and doctors are all too familiar with.

To answer the question at hand, as to whether or not you should buy supplementary insurance, perhaps I could offer a guideline, a kind of mental flow chart to help you with your decision, if you will. If you are in Korea for only a couple of years and in reasonably good health, then no: You do not need extra heath insurance and the NHIP will cover you just fine. If you are getting up there in years and planning to stay in Korea for the long term, it might be worth considering, but keep in mind you probably need much less insurance than you think, and do not be tempted into buying an expensive plan just because your coworkers have it.

As a final thought, on the topic of overall health, if you do not engage in regular and rigorous physical exercise at least a few days a week and cannot resist the temptation to gorge yourself on fried chicken every other day while smoking and binge drinking, then the question of which health insurance plan is best for you should be the least of your worries.

William Urbanski is the managing editor of the Gwangju News and a proud owner of a new electric bike, which is very handy since he has not been able to walk lately. He also recently learned the value of holding the door open for each and every injured person he sees. @will_il_gatto