Beijing public hospitals to lead way in selling franchises to private sector

The Beijing municipal government is moving ahead with plans to let public hospitals sell franchises to the private sector so that patients can get access to a wider range of quality services.

The new system, if adopted, would make Beijing the first place on the mainland to let private investors set up offshoots of public hospitals and capitalise on their reputations. In return, the public institutions would get greater access to investment capital.

The move would add to the various ways some hospitals in Beijing are already trying to attract private-sector money.

For example, doctors from Beijing Cancer Hospital now hold weekly clinics at the high-end, private United Family Hospital; and Phoenix Hospital Group has invested 15 million yuan (HK$19 million) in Mentougou Women and Children's Hospital in return for running the institution and collecting management fees until 2030. And Anzhen Hospital and Beijing Children's Hospital each plan to build two new medical centres by 2018 with private capital.

"Such arrangements are already very popular in the business world, and this will provide a new form of cooperation between public and private hospitals," said Dr Zhong Dongbo, deputy director of the Beijing Health and Family Planning Commission.

Shi Lichen, a senior partner at Allpku management consultancy, said: "It will benefit private capital and public hospitals."