Nation's first for-profit hospital gives up business
By Kim Hyun-bin
The Chinese-owned Greenland International Medical Center on Jeju Island, which would have been the country's first for-profit hospital, announced that it will not open for business after the Jeju provincial government revoked its license for not meeting an opening deadline.
Greenland group, the hospital owner, may also drop an administrative lawsuit filed to get the provincial government to lift its ban on providing medical services to Koreans. Instead, it is expected to file for compensation from the regional government for losses arising from a delayed license approval and inability to open.
On Monday, Greenland Jeju Healthcare Town, a subsidiary of the Shanghai-based Greenland Group sent an email notification to its 50 employees here stating: "Due to unfortunate circumstances, we have no choice but to close down the hospital."
"We'll take legal process (for the dismissal) and if you pick a representative, we will discuss dismissal terms with the person. If any other suitable entity takes over the hospital for operation, we'll make utmost efforts to have you hired first."
The 50 medical staff, including nurses, are all that remain of the 134 hired in August 2017 when Greenland Jeju Healthcare Town applied for the license. As the approval of the license was delayed for more than a year, many left.
The notification came after the local government revoked the medical center's business license, April 17, for failing to open by the March 4 legal deadline without a "reasonable" cause.
In it, the company said the local government approved the license on the condition of providing treatment only to foreigners, but that it could not accept this and had filed an administrative suit to annul the decision in February.
"Apart from the suit, we requested the provincial government take over the hospital several times in order to resolve employees' job security issues, if removing the condition was difficult. But we did not receive any response," it said.
Greenland is expected to file for compensation from the Jeju Special Self-Governing Province by using the investor-state dispute (ISD) settlement system.
The company claimed during a hearing last month that it constructed the hospital facilities and hired employees at the request of the local government and the Jeju Free International City Development Center (JDC), but suffered approximately 85 billion won ($73.4 million) in losses, due to the 15-month delay in getting a license. It also claimed the conditional approval violated the Korea-China FTA.
The local government approved the license for the Chinese company as the country's first for-profit hospital Dec. 5 on the condition that it only treat foreign patients.
The operator strongly protested the decision, claiming it was illegal for the Jeju government to ban it from treating Koreans. In mid-February, it filed the administrative lawsuit to get the ban lifted.
Due to this conflict, the hospital did not open by March 4, a 90-day deadline imposed arbitrarily from the day the license was approved. A request to extend the deadline was rejected.
The regional government held a public hearing March 26 as the first step in the process of cancelling Greenland's license.