Large hospitals protest card fee hike

By Kim Bo-eun

Large hospitals are protesting a credit card fee hike, calling for them to be exempted citing the nature of the services they provide.

The Korean Hospital Association (KHA) said Monday that it submitted a petition to the Financial Services Commission containing this request, March 26. The request was made as card firms have begun negotiating with companies this month on raising transaction fees

Those subject to the fee hike are hospitals with annual revenue of more than 3 billion won ($2.64 million). Card firms reportedly notified that they would raise fees for large hospitals to 2.3 percent.

The automobile, communications and retail industries, which would also have to pay more in transaction fees, have also protested, but only called for the hikes to be reduced.

Hospitals claim they should not be subject to the card fee hike, as they provide services that enhance public health.

“We are different from other businesses due to the public nature of the services we provide,” the KHA spokesman said.

“About 90 percent of hospitals are in the private sector, and medical services are services that are covered by the state's social security system,” he said.

Hospitals say that payment for medical services is fixed, and that they cannot make patients assume the expenses of raised card transaction fees.

This is not the first time hospitals have become subject to a card fee hike. In June last year, hospitals' card fees were raised by more than 0.1 percentage point, after the card fee scheme was reorganized. As a result of the hike, general hospitals now pay a minimum of 3.4 million won more in card fees.

The hospitals also say a hike to 2.3 percent is unreasonable considering Hyundai Motor agreed with card firms to a rise to 1.89 percent.

Card companies had initially called for the automaker to pay between 1.9 percent and 2.0 percent in transaction fees.

There are views that card firms' calls for a 2.3 percent raise fee for large hospitals was an attempt to make them make up for the hikes they failed to achieve with clients such as Hyundai Motor.

It appears unlikely that financial authorities will allow for an exemption, as this would provide grounds for more subjects of the fee hike to request exemptions.

The card fee hike is being pushed forward with, as the Moon Jae-in administration's policy to alleviate the burden of fees for small shop owners by making larger businesses pay more.