The Chinese government now seems ready to accept that health ‘reforms,’ which have effectively privatised the public health system over the last 25 years, have failed to produce optimal, or even tolerable, outcomes for the public at large. With 70% of the population paying out of pocket for all medical expenses—but often unable to afford spiralling costs—the health gains that came from rising incomes and better nutrition in the early years of the reform period are now being eroded. Evidence is accumulating that rural infant and mat-ernal mortality have been on the rise since the late 1990s, and medical bills are a major factor in both rural and urban poverty. The central government knows this well enough from recently surveys and reports, the most damning of which have not yet been made public.
Recent efforts to revive voluntary cooperative medical insurance in rural areas have not proved to be the hoped-for panacea. The poorest and most needy could least afford to contribute; coverage usually only included major illness and accidents (and did not foot the whole bill even for that), and healthier families, whose contributions were needed to keep the system going, did not sign up in sufficient numbers.
Meanwhile, hospitals continue to compete for customers, deriving much the largest part of their income from sales of drugs and procedures. In their journey to market the hospitals have, with perfect economic rationality, concentrated on those with money to spend, investing in high-tech equipment to offer increasingly expensive treatments and procedures for the insured minority in the urban elite. Thus, as a recent article in the authoritative New England Journal of Medicine reports, China has become characterised by “pockets of medical affluence in the midst of declining financial access and exploding costs and inefficiency.” The same economic logic drives health facilities in the poorest, rural areas, where hapless patients, if they can afford to cross the hospital threshold, risk being prescribed drugs and procedures that are not only expensive by Asian standards but also often unnecessary.
Beyond reasonable doubt, many Chinese health facilities thus regularly break the golden rule of ‘doing no harm’. Evidence of this accrues daily in the Chinese press—such as a recent Shanghai Star story about a woman who was charged for ‘fertility treatment’ at a time when she was actually already pregnant, and risked losing the baby. It is not lack of skills that causes such fiascos; it is bad policy, giving full rein to administrative avarice.
What is to be done? More public money is certainly needed, at least for preventive services that have been sorely neglected in the race for profit, and which should be fully publicly funded. Whether by direct subsidy or through revived, national insurance schemes, the poorest cohorts of the population, children and pregnant women should also receive free, comprehensive medical care.
But infusing more public money into the ailing system will not help unless the health service providers are also brought to heel. Total public funding for health has actually been increasing steadily. But it has declined as a proportion of total health expenditures (to 15%, according to the NEJM report), to the extent that health authorities no longer have control over the behaviour of the health service providers. That is the real problem.
China cannot, in any case, afford a fully state-funded health system, despite the breathtaking rise in government revenues over the last decade. For so vast a population, the bill is just too huge. Even small and prosperous European countries, with well established welfare states, are retreating from universal provision as they face the prospect of longer life expectancy combined with advanced medical technologies that multiply the opportunities for prolonging life and enhancing its quality in later years.
Continued efforts to establish a workable, social insurance system in China are therefore imperative; but these must be linked to greatly improved accountability of health service providers.
The World Bank, seeking to kill two birds with one stone, is suggesting that insurance companies and health service providers agree on treatment protocols, stipulating appropriate treatments and costs for a range of conditions. This would certainly improve the financial performance of the insurance market, providing a firmer basis for the calculation of premiums.
But in something as important as health care, government must not retreat from its responsibility to set and effectively enforce standards. China needs a properly funded medical standards inspectorate, committed to defending the public and not the corporate or the government interest, with powers to audit the performance of hospitals, to review complaints, and to revoke licences where necessary.
This is a better option to pursue than at least one other candidate for strengthening the accountability of the medical profession— compensation claims pursued through the courts. China shows plenty of potential for becoming a litigious society and, although some read this as the sign of blossoming ‘rule of law,’ in the health sector it involves distinct dangers. Legal redress naturally favours those who enjoy better access to the law—the well-off—and court claims inhibits medical professionals from giving their considered opinion, for fear of legal action.
Steps should also be taken towards establishing local health boards, with citizen representation, to improve the accountability of local hospitals to the communities they are supposed to serve.
Any lay involvement in health management is likely to be strenuously resisted by the Chinese medical profession—as indeed it has been by the medical profession around the world—because the general public is regarded as too ignorant to understand such matters. In most countries, however, public ignorance is not seen as an insurmountable obstacle to participation in numerous complex issues— including the election of governments.
Of course the Chinese peope are largely ignorant about their health. They have been tutored in ignorance by the system itself, which is able to profit from their ignorance by giving them an antibiotic and an intravenous drip for a cold when fresh fruit juice and a good night’s sleep would do them more good.
A retired western diplomat last year told a gathering of Chinese scholars and international China-watchers that “The Chinese are a nation of hypochondriacs,” and no-one was rude or bold enough to contest the point. The foreigners present had doubtless noted how quick Chinese colleagues are to rush their children to a doctor at the first sign of a stomach upset or fever, with the child all too often ending up hospitalised under ‘observation.’ But hypochondria of this sort is not a deep-rooted ‘cultural’ phenomenon so much as the result of powerlessness, ignorance and fear. And this is now becoming not just a social, but an economic problem because, in order to save against real or imagined future illness, Chinese families are economising on present consumption that drives the growth cycle. (See World Bank puts economic case for health, social spening on page 25)
This points to the need for government investment in public health education, which private health care providers have no real incentive to provide. Indeed, the more that the health system is reconceptualised as a ‘health market,’ the more important it is that its consumers are empowered, through greater knowledge, to make informed choices about what they are buying.
There is also abundant need for vigorous civil society engagement with the health sector—not just in charitable drives to keep stumping up more cash for shiny buildings and hi-tech machines, but as advocates for patient’s rights, and as public watchdogs demanding improved management and accountability of the nation’s medical establishments. National and local governments should actively encourage such engagement as an essential contribution to creating a more efficient and equitable service delivery system.