UPDATE 2-Most South Korea trainee doctors defying pressure to end walkout

(Updates outcome of the meeting between government and doctors, paragraph 12)

By Jack Kim

SEOUL, Feb 29 (Reuters) - Thousands of South Korean trainee doctors are refusing to return to work on Thursday, the day the government set as a deadline to end a mass walkout, warning that the young physicians' medical licences could be suspended if they do not return to hospitals.

Two-thirds of the country's residents and intern doctors have walked off the job to protest a plan to raise the number of students admitted to medical school each year by 2,000 in a bid to address what the government says is a shortage of doctors.

As of Wednesday, only 294 of the more than 9,000 trainee doctors who have left their posts were back at work, Vice Health Minister Park Min-soo told a briefing.

"It is fortunate there are trainee doctors returning to patients' side and I'd say they made the wise decision," said Park.

The young doctors who are protesting say the government should first address pay and working conditions before trying to increase the number of physicians.

The government has said its package of healthcare reforms includes many of the demands of the medical community such as expanded legal protection in malpractice cases and better pay for doctors in essential services.

The government has issued a back-to-work order to doctors who have walked out and warned their medical licences could be suspended if they do not comply by Thursday's deadline.

The walkout has caused disruption at major hospitals which were forced to turn away some patients and cancel surgeries and medical procedures.

An alliance of groups representing patients suffering severe illnesses, including cancer and Lou Gehrig's disease, called on doctors to return to work so there can be discussions on how to improve the medical system for everyone.

Lee Kun-joo, who is in a hospice with terminal lung cancer, made a plea to doctors after saying he had been greatly helped by quality healthcare and well-trained doctors during his 25-year fight against the disease.

"Your place is next to the patients, whatever the reasons and before you consider any conditions," Lee said in a statement reminding the doctors they had taken an oath to hold "the health and well-being of my patient as my first consideration".

Only five or six trainee doctors showed up late Thursday to a meeting the government invited at least 94 doctors to in a bid to persuade them to return, Yonhap reported, underscoring a lack of progress.

There have been no formal discussions so far and the government has said the Korean Medical Association, which represents mostly private practitioners, was not the right body to address the trainee doctors' concerns. (Reporting by Jack Kim; Additional reporting by Joyce Lee Editing by Ed Davies and Michael Perry)