Executives and employees of Labgenomics, a Kosdaq-listed company, have been referred to prosecutors on suspicion of running a so-called "office-manager hospital" for 21 years by borrowing doctors' licenses and reaping about 1 trillion won ($720 million) in illegal gains.
The Metropolitan Investigation Unit of the Seoul Metropolitan Police Agency referred 31 people, including current and former Labgenomics executives, to the Seoul Central District Public Prosecution Office on Sept. 30 on charges of violating the Medical Service Act and fraud under the Act on the Aggravated Punishment of Specific Economic Crimes, police said on the 21st.
The group is accused of using the names of two licensed medical professionals to open and illegally operate a hospital from 2004 through June last year. An "office-manager hospital" refers to an illegal medical institution set up and run by a non-medical person who is not qualified under the Medical Service Act to open a medical institution and instead borrows a doctor's license.
Police put the total amount obtained through the scheme at about 1 trillion won. Of that, roughly 820 billion won came from national health insurance reimbursements, about 200 billion won from COVID-19 testing fees and about 60 billion won from medical aid benefits.