Intensive care

One thing that no one doubts: China needs more hospitals. According to the Beijing News, the capital city’s top three hospitals are accepting 20,000 patients per day. But the newspaper says such volumes mean that they are strained to their limits, calculating that each doctor must see close to 100 patients per shift. Even if they forego their breaks, doctors can only spend 2.4 minutes with each patient.

Chen Zhu, the minister of health, estimates that 80% of the country’s hospitals are in the cities and that 80% of the best hospitals are in big cities like Beijing and Shanghai.

That means that people from the rural areas tend to travel to the cities when they have a serious concern about their health. This further crowds the leading hospitals, making it harder to see a doctor.

Global Business and Finance quotes one disgruntled patient describing just how tough it can be to get an appointment: “Registration is so difficult! Registration to see experts is harder! Registration to see experts of major hospitals is even more difficult. And I do not think registration is becoming easier, since most of the time I fail to even get an appointment.”

In some cities internet booking systems have been introduced as part of the reforms, but they don’t always work, says the newspaper. It is still more common for patients to turn up at the hospital and queue for an appointment on a first-come, first-served basis.

With an eye to the bottom line, hospitals also view their best doctors as a key resource, and charge ‘special requirement service fees’ for appointments with medical experts. This makes consultations unaffordable to ordinary folk, ensuring the best physicians are available only to the better-off.

In theory the increase in health spending should eventually address the mismatch of demand and supply. As stated before, new hospitals are being built. But there is also the problem of how these hospitals are run, both in terms of their finances and their accountability to the communities that they are supposed to serve.

Oversight of public hospitals rests with 11 separate government departments, which means poor performance and malpractice can often go unpunished. A lack of public trust is the predictable result and that’s why aggrieved patients (or their relatives) have sometimes attacked staff or stormed hospitals.

Trust in doctors has plunged. They tend to be lowly paid, and to boost their incomes taking kickbacks and other dubious practices have become all too common – leading patients to wonder if doctors are always acting in their own interests.

A related problem is hospital finances. The term ‘public hospital’ in China is as much of a misnomer as ‘public school’ in Britain. While the latter are actually fee-paying or ‘private’, state hospitals in China also operate more like businesses than state-provided facilities to the public, with a preference for activities with the greatest benefit to the bottom line.

In WiC60 we gave an example of this, when we discussed a World Health Organisation survey suggesting China leads the world in birth by c-sections. It found that as many as 46% of Chinese mothers opt for a surgical birth – versus just 5% in the 1970s. The report warned that surgery for non-medical reasons posed a real risk to mothers’ health.

So why go under the knife? One new mother told the China Economic Weekly she was advised to after doctors told her that her age made a birth risky.

“Afterwards I felt very angry,” explained the 31 year-old, “if age were a problem, why were my prenatal checks normal… I think the hospital just wanted to make more money.”

The experience of a Dr Guo adds weight to those suspicions. “If all mothers chose natural delivery, we’d go bankrupt,” the Henan-based doctor told the magazine. “The state has not given us financial support for many years,” Guo said, “Healthcare workers have to earn their own income.”

Most of the public hospitals remain chronically underfunded and have to resort to prescribing more profitable procedures or medicines to make ends meet. And that financial pressure is prejudicing the advice that many doctors give to their patients, according to Dr Gao Ling, chief obstetrician at the Beijing Amcare Women’s and Children’s Hospital. “[Caesarean births] offer a much higher margin than natural delivery,” Dr Gao told the China Economic Weekly. “Doctors can use much more medical equipment and medicine.”

The charge for a caesarean birth is twice that of a natural birth at his hospital. But it is prescription drugs that serve as real life support in hospital finance. Doctors have long been encouraged to prescribe plenty of them because they account for more than 40% of hospital revenues.

Media attempts to expose unnecessary prescription date back a long time. A much quoted case from 2007 saw journalists send urine samples to 10 hospitals in Hangzhou. Six of them responded diagnosing urinary tract infections, and proposed paid-for remedies. Journalists then revealed that the samples consisted of nothing more than green tea.

The drug procurement process can also lead to corruption too – a good example being Hunan’s Xiangya Hospital where staff were arrested for participating in a major pharmaceutical scam (see WiC114 for the details).

Even after the onset of healthcare reforms, the reliance on drug sales as a revenue stream remains strong. “If every patient saw a doctor in a hospital, but bought the medicine somewhere else, or if the mark-up on drugs is cancelled, there will be problems in hospital revenue and our income will certainly be affected,” one doctor told Global Business and Finance.

Paradoxically a key plank of the reforms is a commitment to make drugs cheaper, in response to widespread patient complaints. This proved one of the most welcomed initiatives in the policy changes. But as the next article points out, it has had its own side-effects too.

© ChinTell Ltd. All rights reserved.

Sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.