Since trainee doctors left workplaces, university hospitals have been hit by an "unprecedented financial crisis." According to hospital sources, some are trying to overcome the crisis by increasing the period of unpaid leave and reducing labor costs, but to little avail.

Sources said there has been an outflow of doctors from university hospitals to small—and medium-sized general hospitals recently, leading to a vicious cycle of manpower leakage and declining revenue.

University hospitals, which entered an emergency management system after interns and residents resigned in February, have received requests for unpaid leave from employees, including nurses, as part of downsizing operations by consolidating and closing wards. Lately, they have also extended the length of unpaid leaves.

Severance Hospital, for instance, announced in March that it would temporarily extend the general staff's sabbatical leave (unpaid leave). Two months later, on Tuesday, it was announced that the number of unpaid leave days would increase from 20 working days to 40.

Previously, unpaid leave was available to general employees, including nurses with more than one year of service at Severance, Gangnam Severance, and Yongin Severance hospitals. Still, the additional days of unpaid leave were expanded, and the seniority limit was removed.

An official from Severance Hospital explained the background: " The decision to expand the number of unpaid leave days was made to overcome management difficulties caused by the resignation of trainee doctors.” On March 15, Yonsei University Medical System President Keum Ki-chang said in a management letter that the hospital would enter an emergency management system to overcome the crisis.

Severance Hospital is not alone.

Asan Medical Center is also accepting applications for unpaid leave and voluntary retirement until mid-April.

Seoul National University Hospital has long entered an emergency management system by increasing its overdraft ceiling from 50 billion won ($36.7 million) to 100 billion won.

‘There's nothing more we can do,’ university hospital heads say with a sigh

Hospital directors struggle to overcome business difficulties by increasing unpaid leave to reduce operating costs but to little avail. “There's nothing more we can do in the face of the ongoing medical crisis,” they said with a sigh.

"Even when we were operating normally, we were barely making ends meet due to high labor costs, but now that bed occupancy rates have dropped by 40 percent and outpatient visits are down by 60 percent, we are in the red," said a university hospital director in Seoul.

Tertiary general hospitals are in a difficult situation. Still, university hospitals that are not tertiary general hospitals get no subsidies from the government and face bankruptcy because of severe management difficulties, according to the director. "I think the government is taking (the situation) too easily,” he added.

Another reason cited for university hospitals' increasing difficulties following junior doctors' resignation was the "doctoral brain drain.” With professors of anesthesiology and pain medicine moving to small- and medium-sized hospitals, some university hospitals have found it difficult even to schedule surgeries.

"The government is sparing no effort to support general hospitals, saying this is a medical crisis. Since the general hospitals are doing well, clinical professors from anesthesiology and emergency medicine are moving to general hospitals," another university hospital director said. "Most of the university hospitals cannot find anesthesiologists."

"Without anesthesiologists, we can't operate. It's a vicious cycle that leads to business difficulties," he said. "The recent court ruling will not make trainee doctors return to hospitals. We can make the most of fellows now, but next year, we can't turn out specialists."

University hospitals emphasized that the government should take active measures to support them before it's too late. Although the government has announced a plan to support the advance payment of health insurance benefits for three months from May to July, "it's just a debt pulled in advance," they said.

"We have asked the Ministry of Health and Welfare to release the level of subsidy during the Covid-19 pandemic from the government budget, but the ministry answered that it is not easy," said Han Seung-beom, chairman of the Council of Tertiary General Hospitals. "The advance payment is better than nothing, but it doesn't help much."

"It seems like pharmaceutical companies, wholesalers, and medical device makers will go bankrupt first because hospitals can't pay their bills," Han said. "There's nothing we can do at this point. We need a government task force to take action as the survival of tertiary general hospitals is at stake."