Suggestion for Reform of Korean Medical-Juridical-Person System: through review on for-profit ownership of Korean medical institutions

The rate of conversion to Medical-juridical-persons' ownership of medical institutions has increased rapidly since its start in 1970s in Korea. The most sensitive issue to introduce for-profit medical institutions, ignited particularly by the WTO/DDA negotiations, has sparked considerable debate, stemming largely from conflicting views on the theoretical effects of ownership status on organizational behavior. This study surveyed health-related experts' opinions on allowing for for-profit-firms-owned medical institutions. Some fear that the obligation to maximize the share-holders' return on their investment will cause the medical institutions to eliminate necessary but less lucrative services. They may easily fall under more pressure to generate income, and respond more aggressively than not-for-profit medical institutions to financial pressures. Advocates of for-profit ownership of medical institutions argue that greater responsiveness to the demands of the marketplace will lead to larger investment, higher quality and lower costs to consumers. Referring to both foreign countries' experience and domestic experts' opinions, this study suggests for reform of the current Korean Medical-Juridical-Person(MJP) System. Introduction of so-called “Capital-investment” MJPs is recommended where the properties left in case of their dissolution can be distributed to original investors according to the procedures stipulated in their statutes. However, their annual profits are not allowed to be allocated to investors, but should be reinvested for their medical institutions, as is the case in current MJPs. Their legal aspects are also reviewed in this study.

영리법인병의원에 대한 고찰을 통한 국내 의료법인제도의 재구성 방안