The Coronavirus: Driver of Change in China’s Healthcare System

by | May 21, 2020

The Coronavirus: Driver of Change in China’s Healthcare System

May 21, 2020

The outbreak of COVID-19 has sent a shock to many healthcare systems around the world as they prepare to respond to the most impactful public health emergency of our time. The coronavirus has tested the response capabilities of many countries as they strategize how to optimize their healthcare system in order to provide high quality, emergency care for those coping with the mysterious virus.

In China’s healthcare systems, the coronavirus highlighted areas for improvement and expansion.


Access to high quality care will be a priority

Currently, China’s healthcare system is divided into multiple tiers. Three separate tiers of hospitals provide varying levels of care and expertise based on their location, funding, and the expertise of the doctors and clinicians permitted to work there.

  • Class I institutions are community health centers that can provide first contact care and primary care for families.
  • Class II and III institutions provide specialist referral services and are meant to triage patients and assign them to doctors based on need.

After the COVID-19 outbreak, it is expected that China will focus their attention on increasing the capacity of smaller, healthcare institutions in order to safeguard their ability to treat patients if a massive health crisis occurs again. Furthermore, private hospitals will likely look to strengthen their ties with public institutions in order to provide a channel for communication, collaboration, and referral in case of congestion throughout the public systems.


Digitization will continue to rise

China’s healthcare system is already the top global innovator in digital health technology integration. The coronavirus put the spotlight on stress points in the Chinese healthcare system that can be helped through further acceptance of digital health technologies and solutions. The private sector has developed many solutions to help track health conditions for patients, doctors, insurance companies, and more in order to make a more streamlined approach to managing and optimizing healthcare.

With more focus on China’s healthcare system than ever, it is expected that investment into the development of innovative healthcare solutions and technologies will continue to rise. Many private companies involved in the healthcare industry see these innovations as a way to carve out market share. With the rise of coronavirus, these digital solutions allowed people with non-COVID related health concerns to seek medical care and track their own symptoms to avoid going to hospitals that could be treating COVID patients. Below are several examples of the use of digital health technologies in China.


Digital Doctor’s appointments

There are currently many companies active in China trying to expand access to doctor’s appointments digitally and expand access to top-tier medical advice using their apps and other booking systems. An example of such a company is Ping An Good Doctor, a brand under the Ping An umbrella, has roadside booths in tier-one cities where a passersby can stop in and be connected immediately to an available doctor for a quick consultation. These booths aim to free up hospitals and clinics to address more urgent concerns and encourage patients with mild symptoms to seek alternative methods of consultation.

Furthermore, there are companies that take this model even further. These companies aim to bring access to specialized, expert care to Chinese citizens anywhere in the country. Patients with severe health complications can, can together with their local physician, video call with experts at high grade research hospitals to discuss test results and treatment options. The patient can book an appointment with doctors based on their specialty, years of experience, and the grade of their medical school and current place of work. Through allowing the patient to hand select their doctor, there is higher trust in the medical advice being provided and access given to rural populations that otherwise had to travel to a provincial capital for treatment.

It is anticipated that the development and the market penetration of these products will grow dramatically over the next few years due to the aging population and the mismatch between the supply and demand for high quality doctors in many of China’s rural areas.


Behavior tracking and wearables

China’s market for behavior tracking and wearable health technology is already strong and is set to develop even further in the next decade. XiaoMi, a popular technology company in China, is the leading producer of wearable fitness bands, however it faces competition from many start-ups. Recently, China has seen the introduction of these technologies geared towards certain at-risk demographics. Hinounou, for instance, creates technology to monitor the behaviors and health statistics of senior citizens. By using technology doctors and families can directly manage and checkup on seniors even in their independent living.

During the time of COVID quarantine measures in China, a focus on staying healthy and strong has been prevalent. This cultural shift towards a more active and aware youth population will likely result in an increased demand for wearable technology and tracking apps.


AI machine learning diagnosis

Many companies in China are developing diagnostic tools that use AI assisted machine learning. It is expected that through combining the AI with doctors’ expertise, the rate of correct diagnosis for certain diseases detected through MRI or X-ray scans can be increased. Due to the coronavirus it has become clear that hospitals and specialists need to be able to optimize their time. Innovative and effective diagnosis tools are extremely helpful for this, and thus there will be an increased focus on development of these products in the future.


Commercial Health Insurance

When SARS swept across China in 2003, the rise of private healthcare ownership rose by over 100%. Currently, most Chinese citizens rely on the public social healthcare system. This system is supported through monthly fees paid by employers as a part of people’s monthly salary. The social insurance only provides a bare minimum of support that reduces the costs of consultation. It does not fully cover the tests, treatment, or prescriptions of individuals seeking care. Because of this private insurance companies offer comprehensive healthcare insurance packages, which cover more than the public insurance. People pay for these private packages  as a way to safeguard against extra costs that could present themselves when there is a need for emergency treatment. Unlike many Western countries, these private insurance packages are paid for by the individual rather than the employer as the employer must contribute to the required public insurance.

As was the case during and after the SARS epidemic, it is expected that the COVID-19 pandemic will lead to more individuals purchasing private health insurance plans to prepare for potential emergencies surrounding the outbreak. This rise in private health insurance plan holders may change the culture of China’s healthcare system as plan holders find they can afford higher quality care with the private insurance.


Final thoughts

COVID-19 has altered the Chinese healthcare system for good. While the Class system of hospitals has allowed for a rapid expansion of healthcare access in China, there now will be an increased focus on improving quality of care and capacity of the Class I and II institutions. Through increased investment, training, and application of digital solutions, China will slowly alter its healthcare system to ensure that they can respond efficiently to any future health crises.

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