Learning from Chinese health reforms

By Alexander Carter, Health Economist, Centre for Health Policy, IGHI

alex-article-photo-2Earlier this month I was fortunate enough to be invited to the ‘2016 Summit on China Hospital Development’, which also provided an opportunity to visit and learn first-hand about the health reforms there. My destination was Hangzhou – considered China’s most beautiful city – which is also where the recent G20 summit was held. Indeed, it is an enchanting place that seems to draw its energy from the Western lake and the surrounding mountains that cocoon the 9 million strong population in a relatively serene, yet commercially vibrant environment – exemplified by Alibaba, the e-commerce giant, which is based there.  This backdrop emphasises the contrast between China’s Maoist origins and its modern society, which has radically changed in recent decades due to the relaxation of anti-protectionist policies and expansion of internationalism.

alex-article-photo-1Post-Mao China has a number of developmental milestones to be proud of. It took the country half the time to double life expectancy compared to Western nations, and GDP has grown by 3.9 percent on average since the year 2000. Much effort and resource has been directed at health reform, with the most recent round of reforms beginning in 2008. These aim to deal with emerging population health issues. 85 percent of all deaths are now due to non-communicable diseases and this growing trend explains in part why health expenditure is expected to swell from 5.6 to 9.1 percent of GDP by 2035. In response, policy makers are taking concerted action to ensure that population health is protected in future. The infrastructure development is something to behold, expenditure on latest technologies for inpatient care delivery is staggering. With robotic prescribing of medications, telemedicine systems that link Chinese clinicians with the most esteemed Western institutions, and the birth of 7,000 bed hospitals, the country has made exhaustive provision for a population that grows by 7 million people each year. However, 60 percent of the growth in health expenditure is expected to come from hospital services and the slowing pace of economic growth is forcing China’s policy makers to reflect on how to deliver care more efficiently and to a higher quality. As part of the ‘Healthy China 2020’ vision, healthcare delivery in the country now needs to shift from hospital focussed inpatient care to community and primary care-led delivery. Integrated care models and concomitant provider payment reforms are considered a promising way forward, which was the focus of my presentation.

We in the UK can learn from the Chinese reforms too. The NHS is evolving to deal with a growing number of multi-morbid patients that require more complex, costly treatment. This is happening at time of unprecedented resource constraint. For example, the NHS spends a tenth of the budget on diabetes care and this is expected to nearly double by 2035 whilst the system faces a £22 billion deficit by 2021/22. The apparent difference between Chinese health reform and English NHS reform is the availability of ample resource – not just financial – for change to take place. This resource is a necessary start-up cost for primary and secondary providers to adapt their systems to produce sustainable healthcare delivery for the future.

Although we face common health problems, there are of course fundamental differences in care financing and provision between our systems. Even so, perhaps one thing we should reflect on is China’s decisive leadership and focussed action on healthcare. If we are able to maintain a similar approach to health reform in the UK, then we will enhance the likelihood of surmounting the challenges we face.

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