In China, too, a health-care system in disarray

More than 300 million Chinese lack health insurance, and authorities have been trying to fix the system.
More than 300 million Chinese lack health insurance, and authorities have been trying to fix the system. (Li Ming Xz/imaginechina Via Associated Press)
By Steven Mufson
Washington Post Foreign Service
Thursday, October 29, 2009

BEIJING -- Shen Baohou, 72, who once worked for a hydropower station in Sichuan province, has a serious heart problem, and he -- and his children -- are paying for it dearly.

Doctors have operated twice on Shen to implant stents at a cost of more than $15,000, about five times China's per capita income. Under China's health-care system, the government pays 60 percent of his hospital expenses and virtually nothing for the medications and oxygen he has needed since.

"I am retired and have little pension every month. So I cannot afford the treatment fee at all," he said, adding that, luckily, his children could afford to help him out. "Without them, I don't think I could have had the operation."

China's health-care system is in disarray, a side effect of the market reforms that have spurred private enterprise and rapid growth since 1980. Before then, state-owned companies offered cradle-to-grave care, part of a system based on danwei, or work units, that provided health, education, pensions and other benefits. But as the economy has grown more diverse, an increasing number of Chinese have had to fend for themselves, with only a porous government insurance program to help.

As U.S. lawmakers engage in a tense debate over health-care reform, Chinese authorities, too, are attempting to fix their system. Over the past five years, the government has tried to provide coverage to more of its 1.4 billion people. But even people covered by a minimal health insurance program are often left with big hospital bills and must pay for most outpatient services and medication. More than 300 million people do not have any health insurance.

In a country once committed to erasing class differences, the gap in the quality of care has been steadily growing, too. Peking University People's Hospital, for example, has computerized charts, GE scanners, top-flight doctors and a deluxe ward where the wealthy can pay extra for private suites. But community clinics in most cities or rural areas tend to be understaffed and poorly equipped.

"We go to clinics for colds, but we don't trust the doctors because they are all being paid by the drug companies and so they over-prescribe," said Helen Ye, a Beijing resident who works for a U.S. company. "So most Chinese people, if they don't feel really sick, do home treatment and try to cure themselves."

China's State Council is eager to improve the situation but can't decide how. The government currently fixes the prices of all medical services, and doctors are treated -- and paid -- like public officials. But that has contributed to a shortage of doctors as many talented Chinese choose better-paid professions.

Some experts say more private spending and investment would improve the system. Gordon G. Liu, a professor of economics at Beijing University's Guanghua School of Management, said he would let people with means spend more money on care, which he said would increase the availability of care by giving doctors incentives to work harder and by luring more Chinese into the medical profession.

Even poorer people would benefit because there would be more care overall, Liu said. He also proposed opening the way for foreign investment from companies such as Kaiser Permanente in building hospitals in China.

But other experts say that approach would be unfair to the poor, who might be neglected by doctors seeking rich patients. They say inequality in China is bad enough these days, as scores of millions of people live on a couple of dollars a day while tens of millions of wealthier Chinese buy luxury cars, Louis Vuitton bags and nifty electronic goods.

The State Council has asked health-care experts to run pilot projects in cities and report back in three years.

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