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Pluralistic healthcare

(China Daily)
Updated: 2010-12-07 08:07

Lowering the threshold for private and even foreign capital to enter the medical services sector is undoubtedly necessary to solve the problem of not enough medical resources and too expensive medical bills.

The State Council released a document on Friday saying that the preferential treatment previously designed for State-owned hospitals will also be granted to non-State medical institutions. If applied this will create a level playing field for both public and private medical service providers.

This is not just good news for domestic healthcare companies, and even foreign ones, who have been longing to enter the healthcare market. It also sends the message that the entire sector will undergo a fundamental change if the policy is implemented to the letter.

Medical resources in this country make up 5 percent of the nation's GDP, much lower than the world average of 9 percent. As a result, people have to wait a long time to see a doctor. Sometimes, patients will begin waiting at midnight in the hope of seeing a particular senior doctor in a big hospital the next day.

Almost all the big hospitals are constantly overcrowded.

In such circumstances, no matter how bad the service these hospitals provide, patients have to accept it, as they have no choice and the hospitals and doctors have no incentive to improve their service.

As early as the 1980s, the State proposed that non-State medical institutions should be encouraged. However, State policies in favor of State-owned ones put non-State healthcare providers at a disadvantage.

For example, while State hospitals are exempt from electricity, water, gas and other charges, private medical institutions are not. Also those patients with government medical insurance cannot have their medical bills reimbursed if the bills are from non-State hospitals.

As a result, although non-State medical institutions make up 36 percent of the total nationwide, their beds account for little more than 5 percent.

The new document stipulates that non-profit private hospitals will enjoy the same preferential policies as their State counterparts in the use of water, electricity, and gas, It also says that State hospitals will no longer be a compulsory for patients covered by government-sponsored medical insurance.

All these policies are designed to inject life into the stagnant healthcare sector. And they should, as fair competition will provide an incentive for both State and non-State hospitals to do a better job.

However, introducing good policies is one thing, putting them into practice as they are originally designed is another. The latter will be much more complicated and difficult.

Much hard work lies ahead.