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THE INVESTOR
August 18, 2019
Big Reunion

Bio & Medicine

Legal battle looms as approval for 1st for-profit hospital gets canceled

  • PUBLISHED :April 18, 2019 - 15:48
  • UPDATED :April 18, 2019 - 16:15
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Attempts to open a for-profit hospital in South Korea have collapsed, portending a long-drawn legal battle between Jeju Self-Governing Province and a Chinese group that feels betrayed.

The approval for Greenland International Hospital, which was poised to become the nation’s first for-profit medical center, was nullified as the Jeju Island government withdrew its a permission. The cancelation came as it refused a request to extend the three-month deadline which ended March 4.

“Greenland failed to launch services within the deadline after receiving a license,” Jeju Island Gov. Won Hee-ryong said. “We have not been given a proper reason why the operations have been delayed after receiving conditional approval from us.” 


Greenland International Hospital in Jeju Island



In December, after a 15-month review and public discussions, Jeju Island granted permission to Green International Hospital on the condition that it treats only foreigners. The Shanghai-based group filed a lawsuit against the partial permission, saying that it should be allowed to cater to domestic patients to sustain the business. Amid conflicts, the hospital has shown scant signs of starting operations.

“Maybe (Greenland) expected our disapproval in December,” Won said during a radio interview on April 18. “This is the first time that Korea is opening a for-profit hospital and they should have taken this into consideration.” 

Greenland might file aother lawsuit against the cancelation and may also seek compensation for its investments of 78 billion won ($68.6 million). 

During a hearing with the regional government, the Chinese group noted that the 15-month prolonged review period was one of the main reasons they were unable to launch operations.

Greenland’s plan to build a for-profit hospital was approved by the Ministry of Health and Welfare in December 2015 under the Park Geun-hye administration. It submitted an application to the Jeju Island government in August 2017 to open a hospital in Health Care Town in Seogwipo, with 134 employees including nine doctors and 28 nurses.

However, public opinion in the country, where profit-making is banned, strongly disapproved the idea even if it was meant only for foreign patients.

For-profit hospitals in Korea are only allowed when they combine foreign capital with domestic medical resources and provide comprehensive services to foreign patients in eight free economic zones and Jeju Island.

The Chinese company could not be reached for comments.

By Park Ga-young (gypark@heraldcorp.com)

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