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How will COVID-19 affect China’s healthcare system?

The effects of coronavirus (COVID-19) have stretched China’s healthcare system to its limits and have prompted the government to accelerate its health reforms for 2020.

In this feature by Pacific Prime China, we look at the country’s changing health reforms and discuss the impacts digital technology (or telehealth) is having on China’s healthcare system.

China’s healthcare reform

Reflecting on the SARs epidemic, the Chinese government was quick to transform its healthcare system to improve access to health services and essential medical supplies. The authorities invested heavily in systems for disease surveillance and reporting, as well as epidemic prevention and control. Many centers for disease control were built across the country to coordinate and control infections. In addition, the government vastly expanded its public insurance programs to provide access to affordable care for the weary rural population.

Fast forward 17 years, the Chinese government has already set in motion the next changes that will focus on access to high-quality care, cost management, drug and healthcare innovation, and digitalization in the healthcare system as a result of the ongoing pandemic.

Access to high-quality care

China’s tiered healthcare system has made vast strides over the past few decades. It is made up of small community health centers (CHCS) and Class I facilities that provide first-contact care, and the larger Class II and III facilities that provide specialist referral services. The system is designed to distribute patients according to their medical needs, thus freeing up valuable health resources and time. Moving forward, the government aims to increase the number of CHCs, particularly in small cities, to boost their reach and improve the efficiency of the entire healthcare system. This will also help reduce the pressures on high tier and specialist hospitals as a result of the novel coronavirus.

Cost management of healthcare services

In the months and years before the COVID-19 outbreak, China’s government had gone to great lengths in taking multiple measures to control healthcare costs and reduce fees that amounted during the SARs epidemic. These measures include centralizing procurement, buying medical drugs in bulk, and implementing a two-invoice policy to remove layers of distributors.

However, for the present moment, these cost management measures will do little to help the country recuperate costs as COVID-19 takes a larger toll on China’s economy and the under-pressure healthcare system. The pandemic has forced the government to pump billions of RMB into its economy and healthcare system. As the pandemic wanes in the future, China will certainly intensify its cost management processes.

Drug and healthcare innovation

In December 2019, China made an essential amendment to its Drug Administration Law, which made it easier for pharma companies to bring new drugs to the market. Other recent changes, such as fast-track approval for certain medical devices, have likewise paved the way for healthcare innovation. Both of these combined could help China discover a vaccine sooner due to the reduced number of red tape surrounding the research of alternative drugs.

Digital health and care

The Chinese government has approved the integration of big data, artificial intelligence, and telehealth in its campaign against COVID-19. The novel coronavirus has wreaked havoc across the healthcare system forcing medical professionals to fall victim to the virus and disabling healthcare services.


The telehealth (telemedicine) industry is predicted to be worth almost USD $30 billion in China for 2020 and has the greatest potential to transform China’s healthcare system by reducing pressure on urban top-tier hospitals and providing rural dwellers easy access.

According to data firm Tianyancha, China already has over 1,000 telehealth companies that have seen a boom in consultations due to lockdown measures. For one online platform, JD Health, it’s daily online consultations went from 10,000 before the pandemic to 150,000 as hospitals and clinics become inundated with visits and patients. It is clear that COVID-19 has accelerated the growth of China’s online medical platforms.

Ping An’s Good Doctor, which is China’s largest healthcare platform, saw an increase of around 900% of new users between December 2019 and January 2020. Additionally, the number of online users and visits has soared at Ding Xiang Yuan, an online community for healthcare professionals, and Chunyu Doctor, a telemedicine platform.

Telehealth will remain attractive and popular after the crisis abates, according to Xin Lijun, CEO of JD Health. China is likely to develop a new habit of getting diagnosis and treatment online. Consequently, this will reduce pressure on hospitals and the health system overall.

The biggest challenge of telehealth in 2020

The biggest challenge of telehealth comes from diagnosis, as it often requires specialist equipment. Although telehealth has been flourishing for many years, the technology needs to become more advanced, yet simple for patients to use easily.

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