Pressure on Korean medicine over auto insurance medical expenses

As Korean medicine costs have rapidly increased in the treatment of patients with minor injuries under auto insurance, insurers and regulatory authorities have tightened their controls. In particular, the per-patient cost of treatment at Korean medicine hospitals rose from 856,000 won in 2020 to 1.083 million won last year, and the cumulative auto insurance loss ratio in the first half of this year reached 84.5%, making cost management no longer just a matter of individual disputes but a full-fledged policy issue.

Amid this trend, institutional reform adding extra verification for prolonged treatment and legal action by insurers are moving forward at the same time. While a system is being pursued under which patients seeking treatment beyond eight weeks must have the necessity of treatment and the appropriate duration confirmed, the number of hospitals sued by Samsung Fire & Marine Insurance has reached 52, showing that clashes over the appropriateness of Korean medicine treatment are spreading throughout the field.

Making herbal medicine standards and manufacturing control more scientific

Regulatory authorities are refining the standards for herbal medicine items and manufacturing management systems in a more scientific and consistent direction. They have presented detailed standards stating that, in determining original species, genetic characteristics should be analyzed using commonly used molecular markers or DNA barcoding regions, while at manufacturing sites, discussions are proceeding in parallel on adjusting processes to match reality, such as allowing mixed grinding of raw herbal materials and improving supplier management.

Behind these efforts is a growing recognition that trust in herbal medicine ingredients and manufacturing processes can no longer be left to custom and practice alone. In fact, with the emergence of a case involving allegations of manufacturing and selling 8.4 tons of illegal herbal materials worth about 400 million won, clarifying standards has become both a form of industry support and a minimum requirement for restoring market trust.

AI and data entering Korean medicine and pharmacy services

Meanwhile, in the medical field, there is a clear movement to supplement areas that traditionally relied on experience with data. Pharmacies are seeking to improve the accuracy and efficiency of medication guidance through pharmacist-assistant artificial intelligence (AI) systems, while research settings are building a foundation to predict the possibility of side effects from combining herbal medicine with synthetic drugs through models such as Meta-HDI.

The significance of this change lies in the fact that Korean medicine and pharmacy services are moving beyond the realm of simple consultation or treatment toward personalized care equipped with evidence and explainability. However, for technology to lead to real trust, data quality, final expert judgment, and clinical validation must all accompany it, meaning that in digital transformation, operating principles are likely to become more important than adoption itself.

Expanding uses through community care and overseas growth

The use of Korean medicine services is expanding beyond debates over regulation and costs into areas such as community care and improving access to healthcare. Incheon City signed business agreements with five Korean medicine medical institutions to add medical consultation and treatment linkage to the child-care safety net, and in rural areas, demand for accessible treatment was confirmed as around 400 people visited free medical volunteer services.

Overseas, against the backdrop of the spread of K-culture and rising demand for health management, efforts are also continuing to restructure Korean medicine-based products and programs to fit local markets. As seen in a case that set a sales target of $10 million in the U.S. market for next year, Korean medicine is being treated both as a subject of debate within Korea’s institutional framework and as an industrial resource testing possibilities for local welfare and exports.