On October 6, 2023, the National Assembly passed a bill to amend the Insurance Business Act, requiring medical institutions, such as hospitals, clinics, and pharmacies, to electronically transmit medical indemnity insurance claim related records directly to insurance companies, upon patient request. The amendment is expected to affect approximately 40 million Koreans enrolled in medical indemnity insurance plans, significantly easing the burden on consumers who are currently required to directly obtain documents from medical institutions in order to submit them with insurance claims seeking reimbursement for medical expenses. It has taken 14 years for the bill to finally pass at the National Assembly, since recommendations for systematic improvements were first proposed by the Anti-Corruption and Civil Rights Commission. The key details of the amendment are as follows.
 

• Patients can request medical institutions to electronically transmit records required for their indemnity insurance claims (e.g., medical bills, receipts, breakdown of medical expenses) directly to their insurance companies.

• Medical institutions must comply with such requests, absent other justifiable reasons.
   

• Insurance companies are required to set up and operate a digital system for processing medical indemnity insurance claims, which can be managed directly or through a third party agent prescribed by Presidential Decree, taking into account the requisite “public interest, security requirements, and expertise.”
   

• Insurance companies (or third party agents entrusted with the operation of digital claims processing) may set up and operate a joint committee with medical institutions and other stakeholders for the smooth operation of digital insurance claims processing systems.
   

• Persons engaged in the establishment and operation of digital claims processing are prohibited from divulging information or materials obtained in the course of performing their duties, and from using and storing such information or materials for purposes other than the processing of indemnity insurance claim – violations may be subject to up to three years imprisonment or a fine of up to KRW 30 million.
   

The amendment is scheduled to take effect one year after the date of promulgation (two years after the date of promulgation for clinic-level medical institutions with less than 30 beds and pharmacies). As such, insurance companies will now need to coordinate with healthcare providers and other stakeholders to establish digital insurance claims systems before the effective date.

[Korean Version]