China: Revolutionary Changes Impact Healthcare for Nationals and Foreigners

China has been through monumental changes over the past twenty years, moving from an agrarian local economy to becoming a leading global industrial player. Rural populations have moved from the countryside into booming cities and there has been an influx of foreigners working for multinationals and Chinese companies, in some instances where Western companies’ production has been totally outsourced to China. The impact these changes have had on China’s healthcare system has been monumental.

Health reform is highly sensitive in China, with concerns over lack of access to medical care triggering recent riots, while burgeoning demand for improved healthcare is placing increasing strains on the government’s budget. According to the World Health Organisation, China spends on average US$342 per person on health, with total expenditure on health as percentage of GDP being 4.5. An IBM Business Consulting report highlighted the fact that although China had experienced a greater increase in wealth, its healthcare system had been neglected, with a much lower percentage of GDP being spent on healthcare when compared with other developing markets such as South Africa, India and Brazil.

According to The Economic Times, China is seeking to attract foreigners to boost development, particularly investors and skilled workers, who can help to grow the country’s economy. There is a general trend that foreigners are staying in China for longer periods, which means healthcare, particularly in privately owned hospitals, needs to adapt to their expectations. China is an enormous country and there is a vast difference between living in the countryside and modern cities. The difference between medical support in the countryside and cities is an important one. If a foreigner found themselves in need of medical attention outside of China’s major cities, they would be hard pressed to find anyone who spoke English fluently and it is unlikely they would be able to diagnose illnesses and prescribe Western medicine.

Not only has the Chinese government had to contend with radical movements of people across China, but trying to introduce a new healthcare system that borrows from western ideas in a country which has relied on its own 2,000 year old traditions isn’t easy. Most Chinese use traditional medicine, and the marriage of Western style medicine with traditional Chinese medicine has not always been ideal. Practitioners are usually experts in one field or other and advice can often be conflicting. When it comes to expats living in China, the usual choice is, of course, Western medicine. Healthcare centres, called VIP centres, have been set up in major city centres, such as Beijing, Shanghai and Guangzhou, where international staff are available with English speaking doctors and nurses. In the past, China has suffered from the perception that the costs of Western medicine and drugs prescribed locally are charged at a higher rate.

One reason for this may be that hospitals generate substantial income from authorised mark-ups on prescription medicines, even when those drugs are not justified on clinical grounds, so Western medicine is automatically at a disadvantage compared to local solutions. According to a recent survey by the Economist Intelligence Unit, medical costs are the No. 1 concern for 84 per cent of China's rural residents. Officially, medical prices are only up 2.8 per cent so far this year. That number does not include the cost of gifts to hospital doctors and administrators to ensure adequate care.

Michael Pettis, a finance professor at Peking University, wonders how a country that grew 10.3 per cent last quarter and is seeing upward pressure on wages could register inflation of only a few percentage points. Another sign of rising prices is that multinationals in China are expect to raise wages an average of 8.4 per cent this year, according to human resources consultant Hewitt Associates. Elsewhere, insurance companies who actually have to pay bills arising in China, estimate the real rate of medical price inflation at well over 100%. The lack of competition in the market means fewer options for patients and it has left insurance companies more-or-less unable to negotiate discounts, giving the medical community the upper hand there. The UK’s Foreign Office site advises visitors to China to have an up to date Yellow Fever injection and certificate. Cholera is present and so travellers should practice strict food, water and personal hygiene precautions. In addition, up to date vaccinations for Hepatitis A and B, Diphtheria and Tetanus are also necessary. Expatriates are strongly recommended to ensure vaccinations are up to date before travel to the country.

According to the UK Foreign Office travel advice site, rabies is relatively common in China, so visitors should always be medically checked if bitten by an animal. AIDS is twice as common in China than the UK for example, 0.1% of the adult population has HIV, compared with 0.2% of the UK population. In addition, the following diseases are rare but need to be guarded against – Tick-borne Encephalitis, Japanese Encephalitis, Tuberculosis, Typhoid, Malaria (in certain areas), Altitude Sickness, Dengue Fever and Schistosomiasis.

Debbie Purser, CEO of April International UK said: “For some time now, we have recognised the problems of accessing good quality healthcare in China. The sheer size of the country can mean it is often quicker and easier to arrange treatment outside China, rather than risk travel to a distant clinic in one of the large centres. For clients based in Hong Kong who travel regularly to China, it is worth remembering that Hong Kong has first rate medical facilities with excellent doctors and medical staff, and expatriates can expect to be treated very well. Our policies have been designed to meet this demand, with multi lingual call centres available 24/7 to support clients wherever they are in China or Hong Kong, so customers can rest assured they will be well covered.”