China ’ s Healthcare Reform

1. China’s Healthcare Reform Ling Li Peking University

2. Text Healthcare Reform phase I Healthcare Reform Phase II The State Council collected health reform proposals worldwide Text The Political Bureau of the Central Committee workshop （Oct 23, 2006） SARS Crisis Public Health Development New CMS Time line of China’s healthcare reform 20032006 2007 2009 2014

3. Why Need Reform? • Rapid increase in health care expenditure • Increase share of personal income spent on health care • Decrease in government spending • Decrease in health insurance coverage • Limited access to health care service • High medical expenses • Poor service qualities • Health Inequality • Regional • Economic

8. Chinese healthcare system • During the period between 1950 to 1978, China had many achievements in health field to be proud of • rapid and large reductions in mortality rate, despite China’s low income per capita at the time • create a low cost, wide coverage primary health care model

9. Chinese healthcare system • After 30 years of economic reform, China’s healthcare system has not improved as well as the economy has. Instead, it has deteriorated in many aspects • Medical costs are escalating rapidly • The relationship between patients and doctors are deteriorating

10. Healthcare reform in China The GHE decreased since the late 1980s and has returned to increase since the early 2000s ( SARS in 2003). Market reform in health sector: 1985 SARS, New govt. (NCMS): 2003 Source: Chinese Health Statistics Yearbook 2011

11. Life Expectancy and Per Capita GDP in 1980 Far Super economic level 数据来源：世界银行

12. Life Expectancy and Per Capita GDP in 1990 数据来源：世界银行

13. Life Expectancy and Per Capita GDP in 2000 Normal Country 数据来源：世界银行

14. Life Expectancy and Per Capita GDP in 2009 略好于2000年 数据来源：世界银行

15. Children Mortality Rate and Per Capita GDP in 1960 数据来源：世界银行

16. 超越经济发展水平 回归正常

17. China’s unbalanced development—1960-80 vs. 1980-2000 Source: Health Statistic Yearbook, 2006

18. Source: World Bank. World Development Indicators 2005. Washington DC

19. % of people who should see a doctor choose not to do so because of the cost Source：The national health service survey, 1993、1998、2003

20. China’s Healthcare Reform Plan • The plan, issued on April 6, 2009 by the State Council, promised to provide a universal primary health service to the country's 1.3 billion people. • “The goal is for everyone to enjoy basic health care services” • Government has responsibility to build a safe, effective, convenient and inexpensive health care system covering both urban and rural residents

21. Healthcare System Financing Drugs & Equipment Health Personnel Healthcare Delivery Management & Regulation

22. Health 22

23. China’s Healthcare Reform Phase I • Speed up the establishment of a universal healthcare system • Set up an essential drug system • Improve the primary health service network • Provide equal access to public health care for urban and rural residents

24. From 2009-2012 • Expand the coverage of health insurance. • Increase the amount of rural and urban population covered by the basic health insurance system or the new rural cooperative medical system to at least 90 percent by 2012 • up to now, more than 1.27 billion urban and rural Chinese have been covered by basic health insurance, coverage rate is 96%

25. From 2009-2012 Build an essential drug system that includes a catalogue of drugs that mostly needed by the public Identified 307 essential medicines for common and frequently-occurring diseases. Government guidance on prices of these medicines has been published. The government has included all the essential medicines into the health insurance reimbursement list. By the end of 2012, this policy had been implemented in all urban and rural primary health care institutions throughout the country

26. From 2009-2012 • Improve health service delivery systems • government increase funding to primary health care institutes • set up family doctor training system, emphases on human resources education • government has invested 60 billion yuan to build 5,169 clinics at the township level, 2,000 hospitals at the county level, 2,400 urban community clinics, and 11,250 village clinics in remote areas

27. From 2009-2012 Gradually provide equal public health services in both rural and urban areas in the country Government has offered all the urban and rural residents 10 types of free public health services. Promote health maintenance by setting up personal health archives for urban and rural residents

28. Restructuring the primary healthcare system • a comprehensive reform of primary care system • increasing government investment in primary care centers • Eliminating medicine-subsidized healthcare • Paying for performance • New regulation and incentive for hospitals and doctors • “Two-Envelope” bidding procedure for procurement of essential medicines • “Technical Bid” ensures the qualification of pharmaceutical firms; • “Business Bid” limits drug prices.

29. 改革成效举例

31. Healthcare and Social Development • Leading the government’s role and development pattern towards emphasizing social development • Experimenting the creative and open approach for the government’s policymaking • Learning by doing social experiment • Integrating top-down and bottom up

32. Challenges of China’s Healthcare Reform • Li Keqiang called for deepened health care reform, speeding up the reform of public hospitals

33. Health service delivery in China • 1980s reform reduced budget support to providers • Providers paid fee-for-service • Regulated prices are distorted • Low (or negative) margin on basic care • High margin on high- tech care and drugs • Providers shift demand to high-tech care and drugs

34. From 2009-2012 Push forward reform trials in public hospital 70% of Chinese hospitals are publicly owned. due to low government investment, the public hospitals are “for profit” "over treatment" and "doctors make living on prescribing medicines“ are popular phenomena 17 pilot cities are reforming the public hospitals

35. Structure of Hospital revenue per patient （general hospitals within health sector ） Source: Health Statistic Yearbook

36. Sanming (三明）model Drugs&Equipment Magt. & Regulation Availability + Affordability = accessibility Delivery Financing Health Personnel 36

37. Restructuring the system Magt. & Regulation New payment system (FFS,DRGs) Public hospital Single Payer by combining all the insurances New incentive for doctors Drugs& Equipment

38. Sanming model 三明医改实现了药品收入、总费用、次均费用同时下降 医改主要措施：1. 医生实行年薪制 2. 按照核定任务发放工资 3. 公示制度等

40. Future Directions • China Dream • Healthy China • Improve people's health and happiness • 12th five-year plan • HiAP

41. Future Directions • Integrated Health with Social and Economic Development • Health care not Disease care system • With information technology, big data • Unified information platform • Overall process • Universal population

42. Future Directions • Great opportunity for information tech applications • Unified information platform • Integrated public hospital system • Restructure payment system and incentive system

43. Health information system in China • A national public health information system • Direct reporting system of infectious disease and public health emergency • A regional community health network • Beijing Dongcheng District Community health network • An integrated Health Information System • Shanghai Min Hang District’s Integrated Health Information System

44. The administration center In-time management Comprehensive health record Health Management GPs Households

45. physical examination Health promotion palliative care Long-term care maternity immunization Lifetime Death Birth • Lifetime SeamlessHealth Maintenance System

46. Healthy World Thank You!

47. Thank You!