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Cosmetic treatments disguised as pain therapy: 131 caught in insurance fraud scheme
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By Jun Ji-hye
A total of 131 individuals, including a clinic director, were allegedly involved in an insurance fraud scheme that disguised cosmetic procedures such as Botox injections as pain treatments, according to police and financial authorities, Tuesday.
The Seoul Metropolitan Police Agency and the Financial Supervisory Service (FSS) said the clinic director had been referred to prosecutors on charges of violating the Special Act on the Prevention of Insurance Fraud, the Medical Service Act and the Act on the Aggravated Punishment of Specific Economic Crimes.
In addition, 130 patients who received the procedures were also referred to prosecutors without detention for their involvement.
Police found that the director had been operating a clinic registered as specializing in dermatology and orthopedics since 2019, while performing non-insured cosmetic procedures such as filler and Botox injections, as well as other skin treatments.
He allegedly falsified medical records to make these procedures appear as physical therapy or pain-relief injections covered by insurance.
The investigation also revealed that he promoted the clinic by offering free treatments to patients who referred new customers, using word-of-mouth marketing to attract more clients.
He further encouraged long-term visits by selling prepaid packages of 10 treatment sessions and issuing vouchers for future use.
During this process, the clinic manipulated medical records, including treatment dates and details, allowing patients to fraudulently claim insurance payments in advance.
Patients who underwent the procedures allegedly submitted falsified medical documents to insurance companies, fraudulently receiving around 400 million won ($279,000) in indemnity insurance payouts from 20 insurers.
Investigators also found that the clinic director routinely exaggerated outpatient visit counts for more than 890 patients, falsifying medical records to illegally obtain about 1 billion won in medical care benefits from the National Health Insurance Service (NHIS).
Authorities said the director took meticulous steps to evade detection, including verifying patients’ overseas travel plans and checking for overlapping treatments at other hospitals to hide the falsified records.
Police said the investigation began in May and was conducted jointly with the FSS and the NHIS.
“Insurance fraud is a serious crime that undermines the financial stability of both public and private insurance systems and drives up premiums for law-abiding policyholders,” a police officer said. “Citizens should not be misled by claims promising reimbursement for cosmetic treatments, which are not covered under indemnity insurance.”