Korean nursing hospitals’ economic value tops $27 bn

[Photo by MK DB]

The economic value of nursing hospitals in South Korea topped 36 trillion won ($27.05 billion), aided by the country’s rapid aging population and increasing demand for elderly hospitalization, a new analysis showed on Sunday.

According to a Daegu Health College report on socio-economic implications of nursing hospitals and their roles in an ultra-aged society, the output value of nursing hospitals in Korea was 36.4 trillion won as of 2022, with a total business revenue of 9.7 trillion won. The contribution of the nursing hospital industry to the country’s gross domestic product (GDP) was also significant during the same period, accounting for 1.7 percent.

The added value generated by the increasing demand for nursing hospitals was estimated to be 15.6 trillion won during this period, with an employment effect of 234,615 people. Given the 136,265 personnel directly employed by nursing hospitals in 2022, there was a significant job creation effect. The number of nursing hospitals was only 0.026 percent compared to the total number of businesses nationwide, but it was 0.54 percent as a percentage of the total number of employees, indicating a higher employment contribution than the number of hospitals.

The report also raised the need to break the functions of nursing hospitals down further into more specific roles and enhance their expertise. Currently, the functions carried out by the country’s nursing hospitals overlap with those of care facilities, necessitating dividing their functions into specialized hospitals, nursing hospitals, and care facilities as well as clarifying their respective roles, the report said.

According to the Organization for Economic Cooperation and Development (OECD), the number of nursing hospital beds per 1,000 elderly people in Korea is significantly higher at 35.6 compared to the OECD average of 3.9, but the number of care facility beds is much lower at 24.8 compared to the OECD average of 42.5. This is attributed to the lack of local community infrastructure, leading nursing hospitals to take on the function of long-term care beds.

“Nursing hospitals are currently grouped together and receive uniform fees, making it difficult to provide customized services based on patients‘ medical needs,” the report said. “Nursing hospitals should be classified into general nursing hospitals and specialized nursing hospitals, such as those for dementia, cancer, and rehabilitation, to provide tailored medical services according to the target population’s characteristics.”

Kim, Jin-hyun, a professor at Seoul National University’s College of Nursing, said, “Less than 50 percent of nursing hospital patients actually need medical treatment,” emphasizing that patients who do not require medical treatment are better off receiving home care or being sent to nursing facilities to qualify for by long-term care insurance.

The report also called for transforming nursing hospitals into Information and communications technology (ICT)-based smart hospitals in line with the development of care and nursing robot technologies, noting that government agencies are already engaged in research and development (R&D) for care and nursing robots.

“We are considering how to differentiate the functions of hospitals dedicated to recovery and rehabilitation and nursing hospitals,” Park Mi-ra, a senior official at the Ministry of Health and Welfare, said.