From Chinese Press

Fund people, not hospitals

(China Daily)
Updated: 2010-07-05 08:08

The need to balance market competition and government subsidy is at the heart of healthcare reform. Subsidizing people is more logical than any proposal to discourage market competition by subsidizing hospitals, says an article in China Youth Daily. Excerpts:

Ren Yuling, a member of the State Council, has said that to reform the healthcare system the government should follow the example of the market reform instead of turning the medical sector into a public welfare system. He insists that the government provide the people with enough subsidies to enable them to choose the hospitals they want to be treated in.

Wang Hufeng, director of Medical Reform Center of Renmin University, argues that the government should subsidize the people and hospitals both. He says that irrespective of whether hospitals are public or private, they have to necessarily provide the public with the best possible medical treatment. Though Wang's argument seems fair and politically correct, his logic is misplaced. Overfeeding public hospitals with taxpayers' money will lead to inefficiency. But subsidizing needy patients can stimulate competition among hospitals. It would also be in line with market principles of providing better services.

(China Daily 07/05/2010 page9)