The People’s Republic of China has made great achievements in improving health status over the past six decades, mainly due to the government’s commitment to health, provision of cost effective public health programmes, growing coverage of health financial protection mechanisms and investments in an extensive health-care delivery network.

1. Health Systems in Transition
People’s Republic of China
Health System Review

2. Health Systems in Transition: China Health System Review
2
Authors:
Qingyue Meng
Hongwei Yang
Wen Chen
Qiang Sun
Xiaoyun Liu
Editors:
Anne Mills
Viroj Tangcharoensathien
Suggested citation: Qingyue M, Hongwei Y, Wen C, Qiang S, Xiaoyun L. People's Republic of China Health System Review. Vol.5
No.7. Manila: World Health Organization, Regional Office for the Western Pacific, 2015.

3. China: Socio-demographic profile
 Overview of health system
 Service delivery network
 Governance and administration
 Health financing
 Infrastructure
 Human Resources
 Major reforms
 Main findings
 Progress made
 Remaining challenges
 Future prospects
3
Presentation outline:
This map is an approximation of actual country borders
Source: https://www.who.int/countries/chn/en/

4. 4
Socio-demographic profile
Area 9.6 million sq. km
3rd largest country by land area
Population • 1350.7 Million (2012)
• 51.8% Urban population
• 1.7 TFR (2012)
Life expectancy at
birth m/f
73.9/76.5 (2012)
GDP per capita: $10944.5 (PPP, current
international $)
HDI 19
Expenditure on
health % GDP
5.4 (2012)
Source: World Bank, World Development Indicators, 2014
Social demographics of China

5. 5
Mixed Health Financing/Universal Health Coverage
1.1. Health legislative system (financing, service delivery and health
supervision system)
2.2. Central Government control and regulation
3.3. Dominant public hospitals, including traditional medicine hospitals
4.4. Constitution includes the right of citizens to state assistance for
health care including disability and ageing
5.5. Basic public health equalization programme
Health system
1. Historical grassroots health facility focus
2. Growing private sector/NGO involvement
3. Social Health Insurance with UHC focus by 2020

6. Service delivery
Outpatient care:
PHC institutions offer services including basic medical, public health services to local
residents
Expensive medical equipment is concentrated in secondary and tertiary hospitals 117
expensive medical equipment pieces, compared to 0.47 in PHC institutions
Inpatient care
All three basic medical insurance systems cover inpatient expenses across rural and
urban areas
Inpatient and outpatient integration:
Hospitals offer both inpatient, outpatient and PHC services
Two way patient referral regulation launched in 2006, to promote higher tier medical
facility utilization when necessary
Patient pathways: Ineffective gate-keeping as two-way referral yet to be fully rolled out,
patients often self refer to hospitals resulting in overcrowding
6

7. 7
Central
• National Health and Family Planning Commission – lead health
development planning and administrative manager
Local (Provincial, Municipal, County)
• Service delivery, some funding
Other
• Professional Associations: CMA, NACTM – professional
management inc. in-service training, middleman between
workforce and government
• Private sector – actively promoted by government to encourage
more players in market
Governance and Administration

8. 8
Health Financing
Trends in health expenditure in China
Source: China National Health Development Research Center,
2014; World Health Organization NHA Indicators, 2013
• Tax-based, social health insurance,
private insurance and OOP payment
• Government health expenditure has
increased 37-fold from 1995-2012
• 3 basic medical insurances cover
95% of the population
• OOP payments decreased from 59%
in 2000 to 24.3% in 2012
• USD $241.5 billion was spent
between 2009-2011 with USD
$68.76 billion spent on URBMI and
NCMS

9. 9
Health Financing – Basic medical insurance schemes
3 basic insurance schemes
•95% population coverage
UEBMI (mandatory for urban employed)
URBMI (urban unemployed)
NRCMS (rural)
Financing
•UEBMI: employer/employee contributions
URBMI and NRCMS: premiums, government subsidy
Overall decrease in OOP payments from 59% to 34% in 2012
Breadth
•UEBMI: inpatient, outpatient, some pharmacies
URBMI and NRCMS: inpatient and limited catastrophic diseases

10. 10
Health Financing – Vulnerable groups
• Revenue-sharing, financial
transfer payment systems est.
to help vulnerable access
health insurance
• Government funded financial
assistance
• MFA target group: low-
income, covers OOP payments
for health insurance | 58.78m
beneficiaries
• Other assistance schemes
cover progressively severe
illnesses including Insurance
Program for Catastrophic
Diseases
MFA: Medical Financial Assistance for the Poor
NRCMS: New Rural Cooperative Medical Scheme
URBMI: Urban Resident Basic Medical Insurance
UEBMI: Urban Employee Basic Medical Insurance
PMI: Private Medical Insurance
Financial Flows

11. Growth of health institutions in China Operational size of hospitals by bed numbers
Infrastructure
Source: MOH, 2013a Source: MOH, 2013a
• Hospitals numbers have grown 2.5 times to 23170 in 2012
• 53% of hospitals are in urban areas reflecting general population distribution
• 4.24 beds per 1000 population in 2012. An increase of 50% from 2007
• NDRC responsible for major infrastructure and private health-care institution development
• Local government funding for infrastructure accounted for 70% of total public fiscal expenditure
between 2009-2011
11

12. Human resources for Health
 4.94 health professionals/1000
population
 84.8% of health professionals in public
sector. No dual practice for physicians
 Grassroots medical care in rural areas
delivered by ‘barefoot doctors’: short-
term training; public health care services
provided.
 Historic periods of rapid health personnel
growth: over 100,000 annually in the
1950s, 150,000 in the 1970s and 1980s
and 200000 post-2005
 Comprehensive medical education system
from pre-training to continued
professional development
12
Growth in total number of health professionals
Source: MOH, 2013a
Note: From 2007, health professionals do not include
apothecaries, inspectors or other types of technician

13. Early health system reforms
13
Centralized control
Communicable disease reduction
Rural and primary health care development
Barefoot doctors
Basic medical security system established
• Emphasis on grassroots care:
• 90% of all counties had medical
institutions by 1952
• Every village had at least 1 barefoot
doctor
• Free services to control communicable
diseases: smallpox and tuberculosis
• Centralized control: service cost, drug mark-
ups
• Initial medical security system: rural
cooperative, government and employee
insurances
China managed to build a basic health system between 1949-1979 despite low
economic development and limited resources

14. Initial reforms
1985
• Decentralization of financial and decision-making for public hospitals
1989
• Central role of user charges in financing emphasized
1992
• Greater autonomy for public hospitals, increasing user charge reliance
1994
• Combined risk pooling for government, employer/employee expenditure
1997
• Decision on re-establishment of rural CMS, UEBMI deepening
1998
• Implementing the UEBMI scheme nationally
2002
• Launch of NRCMS
13

15. Recent reforms
15
2003
• Shift to developmental aims including person-centred health care
2006
• Aim to establish basic health system for all
2006
• NRCMS refinement and planned expansion
2007
• URBMI established (National coverage of basic health insurance system achieved)
2009
• Aim of achieving UHC by 2020 set
2011
• Guidelines for establishing GP system
2012
• Deepening health reform during 12th 5 year plan
2013
• Essential medicine system reform, service industry

16. 16
Achievements and progress made
More than doubled life expectancy
Dramatic improvement in child and maternal health
indicators
Substantial decrease and control of major
communicable diseases
Universal population coverage via basic medical
insurance schemes

17. 17
Achievements and progress: Equity focused
reforms
Cross-government coordination
Universal population coverage
National essential medicines system
Addressing rural shortfalls
Focus on vulnerable groups

18. 18
Achievements and progress: Decreased OOPE
Change in OOP payments as a proportion of THE
Source: WHO and OECD, 2014
• Significant drop in OOP
expenditure from 59% in 2000 to
34% in 2012
• Government interventions
include greater health system
funding, expansion of social
health insurances
• Social welfare programs also set
up to address vulnerable groups,
e.g. poor
• Biggest decline in OOP payments
as proportion of THE in all of
Asia-Pacific

19. 19
Achievements and progress: Health Information Systems
• HIS development for hospital management, finance and pharmacy2000
• Post-SARs: Largest online reporting system for communicable diseases
set up. Online reporting mandatory: avg. reporting time decreased from
5 days to 4 hrs
2003
• HIS for MCH, immunization established
• NRCMS insurance funds managed online and in real time
11th Five Year Plan:
2006-2010
• Regional HIS development based on electronic medical records2009
• Three-tier platform covering national, provincial and country hierarchy
to strengthen HIS application across health system
12th Five Year Plan:
2011-2015
Timeline of achievements

20. 20
Achievements and progress: Family planning services
• Highly successful population control intervention since 1982
• Policies include controlling rapid population growth, reducing birth defects,
encouraging later marriages, later births, fewer babies, and famously ‘the one
child policy’.
• Intervention measures to reduce birth defects include government support for
annual physical examinations targeting women of childbearing age screening for
major diseases. 104 million women served in 2012
• Population implications
• TFR has dramatically decreased: 5.43 to 1.6 between 1971 and 2012
• World population reaching 7 billion delayed by 5 years
• National level implications: Economic development, higher quality of life, eliminating
poverty, conserving the environment and natural resources

21. 21
Achievements and progress: Intersectoral collaboration
National Patriotic Health Campaigns
‘Health in all policies’
Long history of multisectoral
collaboration
• NHFPC often jointly coordinates through equal
cooperation with other departments, e.g.
Ministry of Agriculture.
• Areas of cooperation include: food safety,
occupational health, pro-poor health
programmes
• ‘Patriotic health campaigns’ are delivered by
cross-sector agency utilized to promote health
nationally across public health, sanitation,
disease control and treatment.
• ‘Health in all policies’ focuses on environmental
impacts on health. Now used for development
of healthy cities

22. 22
Achievements and progress made: Vaccines and pharmaceuticals
• China can produce and supply all of its
vaccine needs. It is now the world’s biggest
vaccine-producer.
• Smallpox and newborn tetanus eradicated
in China
• Domestic drug production valued at $256
billion USD
• Challenges:
• Pharmaceuticals account for: 50.3%
of outpatient costs, 41.1% of
inpatient costs
• Drug safety and irrational drug use
are still key issues
Vaccines
Output: 1 billion doses
per year
Vaccines to protect
against 15
communicable
diseases provided free
Medicines
All medical institutions
nationally have their
own pharmacies
National Essential
Medicines policy

23. 23
• NCDs: 85% of 10.3 annual deaths and 70% of total disease burden
• 260m+ NCD patients in China
• Risk factors:
• High smoking rate (54% of male adults, aged 18-69)
• Low exercise rate among adults and high per-capita salt and cooking oil intake
• Ageing population: 8.7% of population older than 65
Remaining challenges: NCDs and risk factors
Major risk factors for NCDs
Source: China Centre for Disease Control and Prevention, 2012b

24. 24
• Socioeconomic differences: rural areas have lower levels of economic development,
health input and demand
• Leading causes of mortality are converging between rural and urban areas (select
figures below)
Implications
• Human resources, bed concentration skewed to urban areas
• Higher financial inequity in rural areas, including health access
• Higher rates of infant and maternal mortality in rural areas
Remaining challenges: Geographic disparities
Rural-Urban Causes of death in China
Source: weighed proportions of and cause-specific mortalities in urban and rural populations based on information in China Health Statistical Yearbooks

25. 25
• Equipment is mainly funded by local governments
• On average, there were 2.87 pieces of expensive equipment in higher-level facilities in 2012
but none in primary healthcare institutions
• Primary health care institutions only have 1 piece of equipment between two facilities. A lack
of technicians may also mean underutilization of these.
• Major medical equipment is lacking: 3 MRIs, 9.4 CT and 0.7 PETs per million people
Remaining challenges: Growing demand for technology
Average number of pieces of medical equipment in one health institution, 2012
Source: MOH, 2013a

26. 26
• Health-care professionals with higher education (19.1%) are more likely to be in urban areas compared to rural
areas (5.9%)
• Lack of qualified health professionals and high turnover slows down primary healthcare institution development
Remaining challenges: Human resources
Viet Nam Thailand
South
Africa
Philippines Japan India China
Doctors 1.224 0.298 0.758 1.153 2.1 0.65 1.456
Nurses 1.006 1.524 0 6 11.5 1 1.512
Dentists 0 0.065 0.192 0.564 0.74 0.08 0.039
Pharmacists 0.324 0.117 0.369 0.886 2.153 0.541 0.26
0
2
4
6
8
10
12
14
Number of health personnel per 1000 population,
selected countries
Source: WHO,
World Health
Statistics, 2013
Note: Data on
Dentists in Viet
Nam and Nurses
in South Africa
not provided

27. 27
Remaining challenges: Migrant health
Up to 236 million floating
migrants
Eligibility for health insurance
tied to registered geographic
zone
Migrants forced to pay full cost
up-front, delayed reimbursement
– higher OOP payments
• Rapid industrialization, urbanization: large
population movement from rural to urban
areas
• ‘Hukou’ or place of registration dictates
access to social welfare, inc. health to
geographic zone
• Lack of insurance coverage: full up-front
payments, 15-25% lower reimbursement
• Targeted interventions: NEPHSS providing
peasant workers and children access to
free public health services| URBMI
developing policies to create continuity of
care

28. 28
Future prospects: China 2020
UHC
establishment
2020
Harmonize
insurance
schemes
Coordinate
reform
components
Person-
centred,
primary care
focused
system
Speed up
public
hospital
reform
Strengthen
Human
Resources
and HIS
Encourage
NGO
investment

29. Based on the Health Systems in Transition
People’s Republic of China Health Systems Review, 2015
29

30. http://www.searo.who.int/entity/asia_pacific_observatory/publications/hits/hit_china/en/
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