An Rx for Chinese Health

For decades, China has been content to let the invisible hand of the market work its magic on the country's economy. But there's one area where the government wants to reassert state control: healthcare.

By Katherine Yester

October 1, 2009, 6:27 PM

For decades, China has been content to let the invisible hand of the market work its magic on the country's economy. But there's one area where the government wants to reassert state control: healthcare. The government recently developed a strategy to provide affordable medical insurance to 90 percent of its population by 2010 and 100 percent by 2020.

For decades, China has been content to let the invisible hand of the market work its magic on the country’s economy. But there’s one area where the government wants to reassert state control: healthcare. The government recently developed a strategy to provide affordable medical insurance to 90 percent of its population by 2010 and 100 percent by 2020.

Today, 500 million Chinese — or nearly 40 percent of the population — can’t afford to see a doctor. Respondents in a January 2008 poll of 101,000 households around the country named healthcare their top worry. Since the free market reforms initiated by Deng Xiaoping in 1978, out-of-pocket healthcare payments have ballooned from 20 percent of medical spending in 1980 to 49 percent in 2006. By comparison, Japanese pay just 15 percent of their medical spending out of pocket. The average hospital stay in China costs nearly as much as an individual’s annual per capita income in the country.

Frustration with the high cost and low quality of care has recently reached fever pitch. Healthcare grievances have been at the heart of thousands of organized protests countrywide in recent years. Some hospitals have even had to hire police to protect medical staff from angry mobs. The dissatisfaction has caught the attention of the government, which is beginning to address social development now that it has met many of its economic goals.

In an unusual sign of its commitment, the government posted its "Healthy China 2020" plan online in October and allowed public comments until November 14. "To meet the demand of the public, the government this time tried to please the public, say[ing], ‘We want to release this draft reform plan, seek your comments and suggestions, and try to be more democratic,’" says Shenglan Tang of the World Health Organization’s Beijing office. More than 25,000 comments were left online, and the government plans to synthesize them into a report for the State Council.

Many of the comments are personal stories, especially from farmers, of frustrating experiences with the healthcare system. Addressing such woes is bound to give any government a headache. Still, the effort might be just what the doctor ordered.