[1] Whether fraud is established in a case where a non-medical person claims the payment of medical care benefit costs to the National Health Insurance Corporation as if the medical institution established in violation of Article 33(2) of the Medical Service Act was a legally established medical care institution under the Medical Service Act (affirmative)

[2] In a case where a non-medical person provides medical treatment to a motor vehicle accident patient, etc. through a medical person having a license in a medical institution established in violation of Article 33(2) of the Medical Service Act, whether the pertinent medical institution’s act of claiming payment of motor vehicle accident insurance medical fees under the Guarantee of Automobile Accident Compensation Act without notifying that the medical institution that provided medical treatment to a motor vehicle accident patient, etc. was established in violation of the aforementioned Medical Service Act constitutes

[3] In a case where a non-medical person provides medical treatment to patients, etc. through a medical person having a license in a medical institution established in violation of Article 33(2) of the Medical Service Act, whether fraud is committed solely on the basis of the fact that the pertinent medical institution issued a medical certificate, etc. of medical treatment to a beneficiary who claims for loss medical expenses according to an indemnity medical insurance contract without notifying that the medical institution that provided the insured with an insurance company, etc. was established in violation of the aforementioned provisions of the Medical Service Act (negative in principle)

[1] The Constitution declares the State’s duty to protect public health (Article 36(3)). National health insurance is a kind of social insurance that copes with social risks arising in relation to national health by means of insurance with insurance premiums in the form of contribution paid by the insured citizens and the burden of the national treasury in order to realize this. For this purpose, the National Health Insurance Act: (a) establishes the National Health Insurance Corporation as a single insurer (Article 13); (b) incorporates only a medical institution established under the Medical Service Act into a health care institution into a health care institution; (c) enable the medical care institution to provide health care benefit on behalf of the National Health Insurance Corporation (Article 42); and (d) require the health care institution to directly claim for “expenses for health care benefit” against the National Health Insurance Corporation (Articles 44(1) and 47(1)).

Therefore, if medical care benefits such as treating patients at a medical institution which has not been lawfully established in violation of Article 33(2) of the Medical Service Act were provided, the pertinent medical institution does not constitute a medical care institution that can claim medical care benefits under the National Health Insurance Act, and thus, it should be deemed that the medical care benefit

Ultimately, claiming the payment of medical care benefit costs to the National Health Insurance Corporation as if the medical institution established by a general person who is not qualified as a medical personnel is a medical care institution legally established under the Medical Service Act is causing error in the decision-making on the payment of medical care benefit costs, thereby constituting deception of fraud. In the event of receiving medical care benefit costs from the National Health Insurance Corporation by such deception, fraud is established.

[2] An insurer of an automobile insurance contract is liable to compensate for losses caused by an accident that occurred while the insured owns, uses, or manages a motor vehicle (hereinafter “traffic accident”) (Article 726-2 of the Commercial Act). Meanwhile, the Guarantee of Automobile Accident Compensation Act mainly aims at protecting the victims of a traffic accident, such as a motor vehicle accident patient (hereinafter “victim”) (Article 1). For this purpose, when the insured, etc. of an automobile insurance is liable to compensate for damages caused by a traffic accident to the insured, etc. of an automobile insurance, the insurer may request the victim to pay the insurance money, etc. directly to the insurance company, etc. under Article 724(2) of the Commercial Act (former part of Article 10(1)), and the amount equivalent to motor vehicle insurance medical fees may request a medical institution directly treated at the victim’s option (the latter part of the same paragraph).

Meanwhile, for the purpose of protecting the victim, the claim for motor vehicle insurance medical fees against the insurance company, etc. of the medical institution is specially recognized within the scope of recognition based on the direct claim against the insurance company, etc., and even if the amount of the claim is not paid to the medical institution, as long as the damage caused by the actual traffic accident occurred and the medical treatment is provided accordingly, it shall be paid

In full view of the legislative purpose of the Guarantee of Automobile Accident Compensation Act, the victim’s direct right to claim for motor vehicle insurance medical fees and the recognition, scope, and nature of the claim for motor vehicle insurance medical fees of the medical institution, even if non-medical personnel established in violation of Article 33(2) of the Medical Service Act, barring any special circumstance, if the victim provided medical treatment to the victim through a licensed medical personnel and filed a claim for motor vehicle insurance medical fees with an insurance company, etc. pursuant to the Guarantee of Automobile Accident Compensation Act, the insurance company, etc. shall not refuse the payment thereof. Therefore, the circumstance that the medical institution that provided the victim was established in violation of the aforementioned Medical Service Act does not affect the duty to pay motor vehicle insurance medical fees of the victim or the relevant medical institution, and thus, the relevant medical institution’s claim for payment without notifying it to the insurance company, etc., cannot

[3] In full view of the provisions of Articles 737, 739-2, and 739-3 of the Commercial Act and the fact that the lost medical insurance policy provides that the insurer compensates for a considerable amount of medical expenses due to the insured's disease or injury, the provisions of the Commercial Act concerning the loss medical insurance are applied mutatis mutandis. In such a case, as in the accident insurance as in the life insurance as in the life insurance as in the personal insurance, only the beneficiary can exercise the claim for the loss medical expenses against the insurance company. On the other hand, the medical institution that provided the insured can receive the medical expenses therefrom from the insured or the beneficiary, and as a result, issue a medical certificate, etc. in response to the beneficiary's claim.

Therefore, barring any special circumstance, the circumstance that a medical institution that treated the insured was established in violation of Article 33(2) of the Medical Service Act should not be deemed to have an effect on the insurer’s obligation to pay the actual expenses of the relevant insured. Even if the relevant medical institution issued a medical certificate, etc. to the beneficiary without notifying the insurance company, etc., such fact alone cannot be deemed as a deception in the crime of fraud.

[1] Article 36(3) of the Constitution of the Republic of Korea; Article 347 of the Criminal Act; Article 33(2) of the Medical Service Act; Articles 13, 42, 44(1), and 47(1) of the National Health Insurance Act / [2] Article 347 of the Criminal Act; Article 33(2) of the Medical Service Act; Articles 724(2) and 726-2 of the Commercial Act; Articles 1 and 10(1) of the Guarantee of Automobile Accident Compensation Act / [3] Article 347 of the Criminal Act; Article 33(2) of the Medical Service Act; Articles 737, 739-2, and 739-3 of the Commercial Act

[1] Supreme Court Decision 2009Da78214 Decided March 28, 2013 (Gong2013Sang, 717), Supreme Court Decision 2012Da72384 Decided May 14, 2015, Supreme Court Decision 2014Do13649 Decided March 24, 2016 / [2] Supreme Court Decision 2012Da107167 Decided April 26, 2013

Defendant

Defendant and Prosecutor

Attorney Lee E-con

Suwon District Court Decision 2017No4041 decided October 13, 2017

All appeals are dismissed.

The grounds of appeal are examined.

1. As to the Defendant’s ground of appeal

A. The part on the violation of the Medical Service Act in relation to the establishment of non-medical persons

(1) An act of employing a medical person who is not qualified as a medical person (hereinafter “non-medical person”) by investing necessary funds in the name of a medical person and reporting the establishment of a medical institution under the name of the medical person is deemed to be a violation of the main sentence of Article 33(2) of the Medical Service Act since a non-medical person actually opens a medical institution. There is no reason to deem that the report on establishment was made under the name of a medical person or the report on establishment was made directly by a medical person who is the name of a medical person. This legal principle likewise applies to the case where a medical institution is reported under the name of a consumer cooperative established under the Consumer Cooperatives Act, which explicitly permits medical business (see Supreme Court Decision 2012Do14360, Aug. 20, 2014).

(2) Based on its stated reasoning, the lower court affirmed the first instance judgment convicting the Defendant of violation of the Medical Service Act among each of the facts charged in the instant case, on the ground that the act of the Defendant, a non-medical person, established two medical institutions (hereinafter “instant medical institution”) such as “○○ Medical Council” and “○○ Department” (hereinafter “instant medical institution”) by solely borrowing the name of a consumer cooperative and employing herb doctors, etc.

(3) The judgment of the court below is in accordance with the above legal principles, and it did not err by misapprehending the legal principles or by violating the principle of no punishment without law.

B. Part of fraud regarding the claim for medical care benefit costs under the National Health Insurance Act

(1) The Constitution declares the State’s duty to protect public health (Article 36(3)). National health insurance is a kind of social insurance that copes with social risks arising from national health with insurance premiums in the form of contributions paid by the insured citizens and the national treasury’s burden in order to realize such obligation (see, e.g., Supreme Court Decision 2009Da78214, Mar. 28, 2013). To this end, the National Health Insurance Act establishes a public corporation as a single insurer (see, e.g., Supreme Court Decision 2009Da78214, Mar. 28, 2013). The National Health Insurance Act establishes the National Health Insurance Corporation as a single insurer (see, e.g., Article 13); incorporate only a medical institution established under the Medical Service Act into a health insurance system into a health care institution; enabling such institution to provide health care benefit on behalf of the National Health Insurance Corporation (Article 42); and, with regard to the amount of expenses borne by the Corporation, the Health Insurance Corporation

Therefore, if medical care benefits such as treating patients at a medical institution which was not lawfully established in violation of Article 33(2) of the Medical Service Act were provided, the pertinent medical institution is not a medical care institution that can claim medical care benefit costs under the National Health Insurance Act, and thus, it should be deemed that the medical care benefit costs are not legally paid (see Supreme Court Decision 2012Da72384, May 14, 2015, etc.).

Ultimately, the National Health Insurance Corporation’s claim for the payment of health care benefit costs to the National Health Insurance Corporation as if the medical institution established by non-medical personnel was legally established under the Medical Service Act constitutes fraud by causing error in the decision-making on the payment of health care benefit costs. Such deception constitutes fraud (see Supreme Court Decision 2014Do13649, Mar. 24, 2016, etc.).

(2) Based on its stated reasoning, the lower court upheld the first instance judgment convicting the Defendant of this part of the charges of fraud on the ground that: (a) claiming for the payment of medical care benefit costs against the National Health Insurance Corporation as if the instant medical institution established by the Defendant, a non-medical person, was a medical institution lawfully established under the Medical Service Act

(3) The judgment of the court below is in accordance with the above legal principles, and there is no error of misapprehending the legal principles or violating the principle of legality.

2. As to the Prosecutor’s ground of appeal

A. Part of fraud regarding the claim for motor vehicle insurance medical fees

(1) An insurer of an automobile insurance contract is liable to compensate for losses caused by an accident that occurred while the insured owns, uses, or manages a motor vehicle (hereinafter “traffic accident”) (Article 726-2 of the Commercial Act). Meanwhile, the Guarantee of Automobile Accident Compensation Act aims at protecting the victims of a traffic accident, such as a motor vehicle accident patient (hereinafter “victim”) (Article 1). For this purpose, when the insured, etc. of an automobile insurance is liable to compensate for losses caused by a traffic accident, the insurer may request the victim to pay the insurance money, etc. directly to the insurance company, etc. in accordance with Article 724(2) of the Commercial Act (the former part of Article 10(1)), and the amount equivalent to motor vehicle insurance medical fees may request the medical institution, at the victim’s option, to pay directly the insurance money, etc. (the latter part of the same paragraph).

Meanwhile, for the purpose of protecting the victim, the claim for motor vehicle insurance medical fees against the insurance company, etc. of a medical institution is specially recognized within the scope of recognition based on the direct claim against the insurance company, etc. (see Supreme Court Decision 2012Da107167, Apr. 26, 2013, etc.). Even if the claim amount is not paid to the medical institution, even if the damage caused by the actual traffic accident occurred and the medical treatment is provided accordingly, the victim shall be paid to the victim.

In full view of the legislative purpose of the Guarantee of Automobile Accident Compensation Act, the victim’s direct right to claim for motor vehicle insurance medical fees and the recognition, scope, and nature of the claim for motor vehicle insurance medical fees of the medical institution, even if non-medical personnel established in violation of Article 33(2) of the Medical Service Act, barring any special circumstance, if the victim provided medical treatment to the victim through a licensed medical personnel and filed a claim for motor vehicle insurance medical fees with an insurance company, etc. pursuant to the Guarantee of Automobile Accident Compensation Act, the insurance company, etc. shall not refuse the payment thereof. Therefore, the circumstance that the medical institution that provided the victim was established in violation of the aforementioned Medical Service Act does not affect the duty to pay motor vehicle insurance medical fees of the victim or the relevant medical institution, and thus, the relevant medical institution’s claim for payment without notifying it to the insurance company, etc., cannot

(2) The court below reversed the judgment of the court of first instance which found the Defendant guilty of the charge of fraud on the ground that the Defendant’s act of claiming for medical fees equivalent to the medical fees cannot be deemed to constitute deception, without notifying the Defendant that the instant medical institution was not a medical institution established under the Medical Service Act, based on the circumstances indicated in its reasoning. In addition, the court below reversed the judgment of the court of first instance which found the Defendant guilty of the charge of fraud, and acquitted the victim.

(3) Examining the reasoning of the lower judgment in light of the record, the lower court’s determination can be deemed as based on the foregoing legal doctrine. Contrary to the allegations in the grounds of appeal, there were no errors by misapprehending the legal doctrine regarding the claim for motor vehicle insurance medical fees and fraud, or by exceeding

B. The part concerning fraud related to the claim for lost medical expenses

(1) The Commercial Act provides that an insurer of a contract of injury insurance shall be liable to pay the insured amount and other benefits if an insured event involving a bodily injury occurs (Article 737). The insurer of a contract of disease insurance shall be liable to pay the insurance amount and other benefits if an insured event involving a disease of the insured occurs (Article 739-2). The provisions on life insurance and accident insurance shall apply mutatis mutandis to a disease insurance to the extent not contrary to its nature (Article 739-3).

In full view of the relevant provisions of the Commercial Act and the fact that the indemnity medical insurance policy provides that an insurance company compensates for damages equivalent to the medical expenses incurred by an insured person's disease or injury, the provisions of the Commercial Act on indemnity medical insurance apply mutatis mutandis to the indemnity insurance. In such a case, as in the case of an accident insurance, as in the personal injury insurance, only the beneficiary can exercise the claim for indemnity medical expenses against the insurance company if the accident occurred in the loss medical insurance, as in the case of an accident insurance, as in the personal injury insurance. On the other hand, the medical institution that provided the insured can receive the medical expenses from the insured or the beneficiary, and as a result, can simply provide the procedure for claiming the insurance money by issuing a medical certificate, etc.

Therefore, barring any special circumstance, the circumstance that a medical institution that treated the insured was established in violation of the above Medical Service Act shall not be deemed to have an effect on the insurer’s obligation to pay the lost medical expenses to the insured. Even if the relevant medical institution did not notify the insurer, etc. and issued a certificate of medical treatment to the beneficiary, such fact alone cannot be deemed as a deception in fraud.

(2) Based on its stated reasoning, the lower court reversed the first instance judgment convicting the Defendant of this part of the charges of fraud on the ground that the act of the instant medical institution established by the Defendant’s medical institution to have the victim receive the lost medical expenses from the insurance company, which is the victim, does not constitute deception, and rendered a not guilty verdict.

(3) Although the judgment of the court below is based on the aforementioned legal principles, it is not sufficient in the reasoning of the judgment below, contrary to what is alleged in the grounds of appeal, the court below did not err by misapprehending the legal principles regarding fraud in relation to the claim of actual medical expenses, or by exceeding the bounds of the

3. Conclusion

Therefore, all appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Jae-hyung (Presiding Justice)