Insurer Ping An aims to fill gaps in China’s ‘underresourced’ health system, to spend up to US$4 billion on health care tech development
- By helping China’s public health and social insurance systems, company will also be able to better grow its health insurance and online health care businesses, co-chief executive says
- Ping An has already spent about 20 billion yuan on health care technology over the past decade
Ping An Insurance (Group), China’s largest insurer by market value, said on Tuesday that it will spend 20 billion yuan to 30 billion yuan (US$4.4 billion) on developing health care related technology over the next five years to fill the missing links in the country’s “underresourced” health system.
By helping China’s public health and social insurance systems improve efficiency and lower costs, the Shenzhen-based company will also be able to better grow its health insurance and online health care businesses, co-chief executive Jessica Tan Sin-yin said.
“For us, to deliver good health care services to our consumers, it is not enough to just provide insurance, or a simple online diagnostic service,” she said during the company’s first health care-themed investor day event. “We need to work hand in hand with the offline network, because this is where the bulk of the health care services are delivered.”
The company has already spent about 20 billion yuan on health care technology over the past decade, and the investment will grow for years to come, as it seeks to digitally link patients, doctors, medical institutions, governments and the social health insurance system, Tan said.
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For Instance, China’s 2,382 top tier 3 hospitals were responsible for 23 per cent of all hospital visits last year, even though they made up just 0.3 per cent of the total number of hospitals in China. The country was also short of 700,000 general practitioners and 10 million medical support staff, while its 3.8 million doctors and 4.4 million nurses were overworked and underpaid, Tan said.
Moreover, with China’s national health care expenditure growing at 12 per cent a year, compared with a 10 per cent rise in its social health care funding pool, out-of-pocket medical costs, which already made up a tenth of its population’s disposal income, will rise further, she added.
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“Everyone knows that the gap [means the contribution from] commercial insurance has to increase,” Tan said. “But that number is not going to magically increase on its own … we need to work with the social insurance [administrators] and the rest of the providers, so that it becomes more sustainable.”
Last year, half of Chinese medical bills were paid for by social insurance, 44 per cent by patients themselves and 6 per cent by commercial insurance.
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Three-year-old Ping An Smart Healthcare, one of the insurer’s technology units, has developed more than 3,000 artificial intelligence models to assist doctors with diagnoses, and to provide tools for patients to manage their chronic conditions out of hospital, Geoff Gao Mengxuan, its chief strategy officer, said.
Ping An Smart Healthcare is also helping the municipal government in Chongqing in southwest China monitor expenditure, operational efficiency and treatment quality at the city’s 230 public hospitals, and is assisting the Shenzhen government in keeping track of operational compliance at 1,000 privately-run clinics through digital management systems.
The company was developing its revenue sources, including project fees, subscription fees and value-added services fees, Gao said.