China's healthcare plans backed by international experts

This article was published by China Daily on Jan 15, 2016

By Cecily Liu

International experts endorsed China's emphasis on increasing healthcare and health insurance coverage in its 13th Five-Year Plan (2016-20), and say that China's growing healthcare sector creates great opportunities for foreign companies.

The plan focuses on encouraging more private sector participation and private capital investment in the healthcare sector, so to achieve more universal coverage. It also emphasizes directing resources towards less privileged groups to achieve a wider spread and to ensure efficient resource distribution by encouraging the growth of primary care.

Seen as the blueprint for China's development for the next half-decade, the new Five-Year Plan will be published next year. A proposed plan was adopted at a key party meeting in Beijing on Oct 29.

Kalipso Chalkidou, director of NICE International, part of the UK's National Health Service, says that the growth of private sector provision of healthcare services is important although good regulation is needed.

"For example, it is a good idea to have private sector provision of healthcare, but at the same time it is good to have public sector insurance to cover these private sector services," says Chalkidou, referring to the UK's NHS system, which has public sector coverage but many private sector hospitals providing services within the system.

In addition, she sees the plan's emphasis on increasing primary care as positive, as the UK's experience illustrate its importance. In the UK, primary care accounts for about 90 percent of encounters, but they only take up 10 percent of public healthcare budget, she says.

"In order to increase primary care, the Chinese government will need to deliver good training to GPs and make sure they have the necessary skills, to build up the general population's trust for GPs, and to build a good system of referrals from GPs to specialist practitioners."

The National Health and Family Planning Commission has already rolled out pilot programs for creating a special post for general practitioners in some areas, with pay packages different from other government employed workers, such as teachers and civil servants, because previously all government employed workers are on similar salary packages.

Mark Gilbraith, head of PwC China's Healthcare & Life Sciences team, says that as an increasingly level playing field for private hospitals is being created, overseas healthcare institutions may look more seriously at China as an expansion play.

"The nature of these expansions may vary, from medical and scientific affiliations, to teaching coalitions, to consulting set-ups all the way to what we would most expect – operations management ventures and entrusting through to green-field or acquisition, though capital lay-out is not the preferred mode at the moment," says Gilbraith.

Gilbraith adds that some of the more recent examples of how Britain's healthcare expertise can contribute to China's Healthcare Reform include the provision of advanced proton beam technologies for the treatment of cancer, expertise in the fields of hospital operations management as well as elderly care management, both in-home and at community centres, and the provision of skills, development and technical training for medical practitioners, including allied and nursing staff, he says.

Already some British healthcare organizations have already established subsidiaries in China, or established consultancy or joint venture partnerships in China. For example, Sinophi Healthcare, which signed contracts for hospital management and hospital investment worth 120 million pounds when Prime Minister David Cameron visited China in 2013, is helping Huai'an First People's Hospital build a 1,000-bed oncology hospital.

Another British company, Heythorp Healthcare, is investing in the China-UK Healthcare Park in Nanjing, together with Jiangsu Far East Group. The park will comprise 56,000 square meters of mixed-use healthcare space and include nursing care, a rehabilitation centre and private care clinics.

NICE International has also been working over the past six years with its Chinese partners, the National Health and Family Planning Commission and the China National Health Development Research Centre, to integrate international research on the treatment of chronic diseases into China's healthcare system in a way that is suitable for China's situation.

Chalkidou says that in the future, as China reforms its healthcare system, there will be many more opportunities for the UK's healthcare industry.

"This could happen in the form of foreign direct investment, including the building and running of hospitals, the installing of IT systems to manage patient records and the provision of healthcare services, amongst others," Chalkidou says.