China must fix its health-care system

PUBLISHED : Monday, 21 October, 2013, 3:23am
UPDATED : Monday, 21 October, 2013, 8:44am

Once the mainland's health care system became a serious casualty of free-market reforms, there was no simple cure.

Five years ago Beijing unveiled a three-year plan to bring the cost of medical care within the means of the poor and even some of the middle class, with health coverage for 200 million uninsured the priority. The plan also called for cheaper medicines by limiting mark-ups and the building or upgrading of thousands of hospitals and clinics. As a result many more people now have basic health insurance.

But even a budget of 850 billion yuan was never going to fix a broken system. Recent revelations of corrupt relationships between multinational drug companies and health care services have done nothing for public confidence.

For years, there has been talk of opening up the health sector for private investment. Now, for the first time, the State Council has rolled out detailed guidelines for private-sector involvement in a wide range of health services. The policy envisages that private health services will become an eight trillion yuan industry by 2020. The government will remain responsible for basic medical care, but for the first time it will be allowed to provide health services by purchasing them from the private sector. With proper accountability, that could improve cost-effectiveness and give better value for public money.

Concrete details instead of empty words are welcome. Inequity in the provision of medical services has become a potent source of discontent. There is an urgent need to ramp up the provision of medical services to ordinary people.

The key is implementation of central government policy. Local authorities are adept at closing glass doors on reform that weakens local controls. A bigger role for the private sector should be an opportunity to allow doctors to open their own clinics. This would supplement government investment in community clinics to encourage mainlanders to see family doctors before going to public hospitals.