China’s Healthcare Reform

Ling LiPeking University

Time line of China’s healthcare reform

2003 2006 2007 2009 2014

SARS CrisisPublic Health

DevelopmentNew CMS

The Political Bureau of the Central

Committee workshop

（ Oct 23, 2006）

Text

Text

The State Council collected health reform proposals worldwide

Healthcare Reform phase I

Healthcare Reform

Phase II

Why Need Reform? Rapid increase in health care expenditure Increase share of personal income spent on

health care Decrease in government spending Decrease in health insurance coverage

Limited access to health care service High medical expenses Poor service qualities

Health Inequality Regional Economic

Chinese healthcare system During the period between 1950 to 1978, China had

many achievements in health field to be proud of rapid and large reductions in mortality rate, despite

China’s low income per capita at the time create a low cost, wide coverage primary health care

model

Chinese healthcare system After 30 years of economic reform, China’s healthcare

system has not improved as well as the economy has. Instead, it has deteriorated in many aspects Medical costs are escalating rapidly The relationship between patients and doctors are

deteriorating

The GHE decreased since the late 1980s and has returned to increase since the early 2000s ( SARS in 2003).

Source: Chinese Health Statistics Yearbook 2011

Market reform in health sector: 1985

SARS, New govt. (NCMS): 2003

Healthcare reform in China

10

Life Expectancy and Per Capita GDP in 1980

Far Super economic level

数据来源：世界银行

Life Expectancy and Per Capita GDP in 1990

数据来源：世界银行

Life Expectancy and Per Capita GDP in 2000

Normal Country

数据来源：世界银行

Life Expectancy and Per Capita GDP in 2009

略好于 2000 年

数据来源：世界银行

Children Mortality Rate and Per Capita GDP in 1960

数据来源：世界银行

超越经济发展水平

回归正常

China’s unbalanced development—1960-80 vs. 1980-2000

30

67.9 68.6 71.4

01020304050607080

before 1949 1973-1975 1981 1990 2000

Life Expectancy in Selected Years

totalmalefemale

Source: Health Statistic Yearbook, 2006

  Life Expectancy （ year）

under-five mortality（‰） Increase of Life Expectancy

Decrease of under-five mortality

  1980 2003 1980 2003

China 68 71 42 37 3 -5Australia 74 79 11 6 5 -5Hong Kong

74 79 11 3 5 -8Japan 76 82 8 4 6 -4Korea 67 76 26 5 9 -21Malaysia 67 72 30 7 5 -23New Zealand

73 79 13 6 6 -7Singapore 71 80 12 3 9 -9Sri Lanka 68 73 34 15 3 -19

Source: World Bank. World Development Indicators 2005. Washington DC

Big city

Middle-size city

Small city

Rural 1 Rural 2 Rural 3 Rural 4

inpatient

1993 34.09 33.87 53.47 47.95 63.15 61.14 67.721998 53.12 58.43 70.77 63.80 54.12 70.26 69.38 2003 64.4 35.6 74.8 77.6 74.9 75.5 73.6

Outpatient

1993 3.21 2.40 9.58 15.10 21.36 19.55 24.421998 36.69 23.48 42.96 30.09 31.67 42.29 38.722003 30.8 32.7 47 29.2 33.9 41.2 49.1

Source： The national health service survey, 1993 、 1998 、 2003

% of people who should see a doctor choose not to do so because of the cost

China’s Healthcare Reform Plan The plan, issued on April 6, 2009 by the

State Council, promised to provide a universal primary health service to the country's 1.3 billion people.

“The goal is for everyone to enjoy basic health care services”

Government has responsibility to build a safe, effective, convenient and inexpensive health care system covering both urban and rural residents

Healthcare System

Financing

Healthcare Delivery

Management & Regulation

Drugs & Equipment

Health Personnel

22

Health

China’s Healthcare Reform Phase I Speed up the establishment of a universal

healthcare system Set up an essential drug system Improve the primary health service

network Provide equal access to public health care

for urban and rural residents

From 2009-2012 Expand the coverage of health insurance.

Increase the amount of rural and urban population covered by the basic health insurance system or the new rural cooperative medical system to at least 90 percent by 2012

up to now, more than 1.27 billion urban and rural Chinese have been covered by basic health insurance, coverage rate is 96%

From 2009-2012 Build an essential drug system that includes a

catalogue of drugs that mostly needed by the public

Identified 307 essential medicines for common and frequently-occurring diseases. Government guidance on prices of these medicines has

been published. The government has included all the essential

medicines into the health insurance reimbursement list. By the end of 2012, this policy had been implemented in

all urban and rural primary health care institutions throughout the country

From 2009-2012 Improve health service delivery systems

government increase funding to primary health care institutes

set up family doctor training system, emphases on human resources education

government has invested 60 billion yuan to build 5,169 clinics at the township level, 2,000 hospitals at the county level, 2,400 urban community clinics, and 11,250 village clinics in remote areas

From 2009-2012 Gradually provide equal public health

services in both rural and urban areas in the country

Government has offered all the urban and rural residents 10 types of free public health services.

Promote health maintenance by setting up personal health archives for urban and rural residents

Restructuring the primary healthcare system a comprehensive reform of primary care

system increasing government investment in primary care

centers Eliminating medicine-subsidized healthcare Paying for performance New regulation and incentive for hospitals and doctors “Two-Envelope” bidding procedure for procurement of

essential medicines• “Technical Bid” ensures the qualification of pharmaceutical firms;• “Business Bid” limits drug prices.

改革成效举例

Healthcare and Social Development Leading the government’s role and

development pattern towards emphasizing social development

Experimenting the creative and open approach for the government’s policymaking

Learning by doing social experiment Integrating top-down and bottom up

Challenges of China’s Healthcare Reform Li Keqiang called for deepened health

care reform, speeding up the reform of public hospitals

Health service delivery in China 1980s reform reduced budget support to

providers Providers paid fee-for-service Regulated prices are distorted

Low (or negative) margin on basic care High margin on high- tech care and drugs

Providers shift demand to high-tech care and drugs

From 2009-2012 Push forward reform trials in public

hospital 70% of Chinese hospitals are publicly owned. due to low government investment, the public

hospitals are “for profit” "over treatment" and "doctors make living on

prescribing medicines“ are popular phenomena

17 pilot cities are reforming the public hospitals

Structure of Hospital revenue per patient （ general hospitals within health sector ）

Source: Health Statistic Yearbook

Revenue per outpatient（ yuan）

Revenue from medicine（ % ）

Revenue from medical examination （ % ）

Revenue per inpatient （ yuan）

Revenue from medicine（ % ）

Revenue from medical examination （ % ）

1990 10.9 67.9 19.3 473.3 55.1 25.71995 39.9 64.2 22.8 1667.8 52.8 30.41998 68.8 62.1 16.4 2596.8 49.2 28.12000 85.8 58.6 19.6 3083.7 46.1 31.72002 99.6 55.4 28 3597.7 44.4 36.72004 118.0 52.5 29.8 4284.8 43.7 36.62005 126.9 52.0 29.8 4661.5 43.9 36.02010 173.8 50.7 30.9 6525.6 43.4 25.92011 186.1 49.6 31.2 7027.7 41.8 26.7

36

Sanming ( 三明） model

Magt. & Regulation

Delivery

Financing

Availability+

Affordability=

accessibility

Health Personnel

Drugs &Equipment

Public hospital

New incentive for doctors

Magt. & Regulation

New payment system (FFS,DRGs)

Drugs & Equipment

Single Payer by combining all the insurances

Restructuring the system

Sanming model

合计 17091. 04 - 0. 58% 5691. 14 - 29. 24% 4975. 66 19. 32% 6859 - 9. 49% 129. 01 101. 89 -1. 81% 4. 39三明市第一医院 7332. 45 8. 46% 2435. 63 - 10. 19% 1976. 02 15. 59% 8322 - 8. 09% 138. 63 118. 33 6. 03% 5. 40三明市第二医院 2703. 36 - 0. 18% 911. 07 - 29. 28% 832. 53 23. 30% 7797 - 17. 71% 126. 04 100. 80 -20. 82% 4. 99三明市中西医结合医院 1592. 59 - 5. 81% 495. 86 - 36. 57% 506. 15 17. 03% 7463 - 6. 83% 111. 26 97. 44 -22. 46% 4. 57

三明市第五医院 322. 08 - 30. 93% 102. 24 - 59. 27% 135. 11 3. 64% 4736 - 24. 43% 123. 67 97. 84 4. 58% 3. 22梅列区医院 95. 28 12. 50% 19. 12 - 34. 93% 24. 25 13. 66% 3083 - 26. 82% 90. 22 79. 02 -52. 92% 2. 99永安市立医院 1090. 40 - 1. 63% 360. 77 - 37. 19% 384. 60 32. 00% 6153 - 10. 96% 130. 82 79. 72 -10. 74% 3. 97大田县医院 307. 90 - 25. 98% 106. 33 - 58. 66% 83. 53 34. 39% 5115 6. 48% 135. 80 100. 15 8. 37% 5. 92

次均普通门诊费用（元）

次均门诊总费用

（元）

检查化验费

( )万元

住院总费( )用 万元

药品收入（万元）

每百门急诊住院人次(住院率)

同比增长

次均普通门诊同比增

%长

同比增长%

次均住院费用（元）

同比增长%

同比增长%

三明医改实现了药品收入、总费用、次均费用同时下降医改主要措施： 1. 医生实行年薪制 2. 按照核定任务发放工资 3. 公示制度等

Future Directions

• China Dream• Healthy China

•Improve people's health and happiness• 12th five-year plan•HiAP

Future Directions Integrated Health with Social and

Economic Development Health care not Disease care system With information technology, big

data• Unified information platform• Overall process • Universal population

Future Directions

Great opportunity for information tech applications Unified information platform Integrated public hospital system Restructure payment system and incentive

system

Health information system in China

A national public health information system• Direct reporting system of infectious disease

and public health emergency A regional community health network

• Beijing Dongcheng District Community health network

An integrated Health Information System• Shanghai Min Hang District’s Integrated Health

Information System

The administration center

GPs Households

Health Management

Comprehensive health recordIn-time management

Lifetime Seamless Health Maintenance System

maternity palliative

care

Birth Lifetime Death

physical examination Health promotion

immunization Long-term care

Thank You!H

Healthy World

Thank You!