China considers higher patient fees to fund salary boost for doctors

Government contends medical services have long been sold short, but assures increased charges to patients will be offset by public insurance

PUBLISHED : Friday, 02 May, 2014, 4:32pm
UPDATED : Saturday, 03 May, 2014, 4:00am

Beijing has pledged to better compensate doctors and nurses in the public sector by increasing health care costs, amid complaints that China’s doctors are grossly underpaid.

Some types of doctors are reportedly paid less than barbers or housekeepers for certain shifts, according to hospital officials. Public health is at risk if doctors and nurses are overworked and underpaid, and if fewer and fewer skilled talents enter the medical field.

However, the central government was quick to claim that the increase in charges to patients would be offset by public medical insurance.

Guo Jianying, inspector of the pricing division of the National Development and Reform Commission (NDRC), said the authorities were studying feasible adjustments in medical service costs, particularly at public hospitals, as part of reforms.

[Continued underpayment] will be very dangerous. ...Doctors will think of other ways to make money and it is bad for patients, doctors and the government
Wen Jianmin, orthopaedist 

Guo said the new costs should reflect the value of services provided by medical workers while being acceptable under basic health insurance schemes.

Medical service fees have not changed much since the 1990s, when the government subsidised around one-third of patients’ medical bills and hospitals were allowed to impose a surcharge of up to 15 per cent on prescription drugs.

But the stagnant fees meant medical staff’s salaries have not kept pace with inflation and dramatic increases in other sectors’ incomes.

When government subsidies to public hospitals gradually dropped – it now accounts for some 7 per cent of hospitals’ funds – these relied heavily on selling prescription medication, medical tests and equipment for revenue. But these have not been enough to raise salaries for public doctors across the board.

“A doctor specialising in traditional Chinese medicine might spend a whole morning treating patients and the fees are no more than a couple of hundred yuan. So much cheaper than a barber,” said Lin Shaobin, vice-president of Fuzhou No.2 Hospital, a top public hospital in Fujian province.

Lin himself, a cardiologist, gets paid only 7.50 yuan (HK$9.40) for outpatient consultations.

There are very few private hospitals or clinics in China to help doctors augment such paltry incomes, as the government has been slow to allow private capital in health care. There are 9,800 private hospitals on the mainland as of last year – or less than half total hospital numbers.

At Fuzhou No.2 Hospital, patients are charged 9 yuan a night to stay in a ward with six beds and a doctor earns 15 yuan for an entire night shift – not even enough to buy a bowl of noodles, according to Lin. In comparison, housekeepers could earn 180 yuan a night, Lin said.

Any change should strike a balance between the value of human resources and what is affordable to the public, and such reforms should be gradual, Lin said.

Huang Jiefu, a top transplant surgeon in China, says it takes seven to eight surgeons to perform a delicate operations such as sectioning off a part of the liver. But for several hours’ work, the surgery only costs 2,000 yuan.

“It must be changed otherwise it will be very dangerous,” said Wen Jianmin, director of orthopaedics at Beijing’s Wangjing Hospital. “Talents will leave the profession or good students simply will not study medicine. Doctors will think of other ways to make money and it is bad for patients, doctors and the government.”

In 2011, prescription drug sales accounted for 40 per cent – or 471 billion yuan – of public hospitals’ total revenue. Medical services such as consultation, treatment, surgery and examinations accounted for 48 per cent, according to the health ministry.

A [TCM doctor] might spend a whole morning treating patients and the fees are no more than a couple of hundred yuan
Lin Shaobin, hospital official

The State Council has ordered hospitals not to rely on drug surcharges but instead adjust prices on medical services. An NDRC memo in 2012 asked each province to do so, but only Zhejiang has come up with a plan.

There have been pilot programmes to scrap drug charges entirely and increase some medical service fees. Five top public hospitals did so, increasing consultation fees from 5 yuan to 42 yuan starting in May 2012. Their prescription drug revenue has dropped from 70 per cent to 58 per cent of total income.

But in some areas, hospitals actually under-charged for services. Beijing’s health authority, for example, found that 21 of its public hospitals were under-charging on 70 per cent of its list of medical services, amounting to 3.4 billion yuan in losses each year.

Fang Laiying, director of the Beijing Health and Family Planning Commission, was quoted by media as saying the pilot programme showed that there was no one-size-fits-all solution to adjusting medical service prices – as some should go up, some down.

Wen, the orthopaedics chief at Wangjing Hospital, suggested that consultation fees should be raised and that doctors should have a monthly salary eight to 10 times more than the city’s average. Wen’s consultation fee is 10 yuan.

But finding the right formula could be difficult.

“It is very difficult to improve doctors’ benefits and meet all these requirements at the same time,” Wen acknowledged. “The result could be the insurance [providers] will curb spending [on payouts] and patients will suffer from not getting proper treatment or insufficient drugs.”