The Role and Scope of Private Medical Practice in China

The Role and Scope of
Private Medical Practice
in China
Lim Meng Kin
Yang Hui,
Zhang Tuohong
Zhou Zijun
Feng Wen
Chen Yude
March 2002

Contents
Page
List of tables
List of figures
Acknowledgements
Abstract
i
i
ii
iii
Chapter 1. Introduction 1
Chapter 2. Methodology 4
Chapter 3. Results
1. Main findings from official sources 15
2. Household questionnaire survey 18
3. Doctors’ questionnaire survey 33
4. Residents’ focus groups 41
5. Doctors’ focus groups 45
6. Interviews with stakeholders 50
Chapter 4. Discussion 60
Chapter 5. Conclusion and recommendations 70
Annexes
A. Sample of household questionnaire A1-9
B. Sample of doctors’ questionnaire B1-4
C. Official national documents on private medical practice C1-4
D. Official provincial documents on private medical practice D1-4
E. Analyses of household questionnaire survey E1-95
F. Analyses of doctors’ questionnaire survey F1-18

List of tables and figures
Tables
Page
1. Economic development in China by province, 1998 5
2. Study provinces and the respective cities and counties 6
3. Basic statistics compiled from official sources for study provinces, cities and counties 17
(1999)
4. Profile of household respondents by provinces and types of residential area 19
5. Health care utilization in the past 12 months 20
6. Health care facility visited in the past 12 months 20
7. Multivariate analysis for past health care utilization 20
8. Multivariate analysis for unmet need due to any reasons 21
9. Main reason for the unmet need 21
10. Multivariate analysis for unmet need due to cost 22
11. “Genuine” unmet need, defined as those who needed to see a doctor but did not get to see 22
any doctor at all in the last 12 months
12. Factors that independently affecting “genuine” unmet need in the last 12-month 23
13. Factors independently affecting utilization of private clinics 23
14. The most common conditions (top 5) seen at the various health care facilities 24
15. Respondents who answered questions on ratings of their experiences with health care 24
facilities
16. Key dimensions of patient satisfaction for outpatient clinic 25
17. Comparison of key domains of patient satisfaction for outpatient clinic between public and 27
private clinic visitors
18. Comparison of specific items of patient satisfaction, in which public clinics fared better 27
than private clinics
19. Factors influencing choice of doctors 30
20. Respondents’ evaluation of the health care system 30
21. Opinions of residents in urban and rural areas toward several statements (% agree and 31
strongly agree)
22. Multivariate analysis for being in favor of setting up more private hospitals
31
(% agree and strongly agree)
23. Multivariate analysis for being in favor of setting up more private clinics
32
(% agree and strongly agree)
24. Profile of doctors by practice settings 34
25. Profile of doctors by provinces and urban/rural area 35
26. Overall rating of the present health care system 36
27. Opinions towards health care system 37
28. Need to encourage more private clinics 38
29. Part time private medical practice for public doctors 39
30 Satisfaction with current medical practice 40
31 Percentage who say health care costs are “too high and unaffordable 62
Figures
1. Geographical location of the three study provinces in China 4
2. Typical sampling frame for province 8
3. Structure of the household questionnaire 9
4. Distribution of doctors surveyed in each province 11
5. Comparison of experiences at private clinics and public clinics 26
7. Comparison of experiences at private and public clinics (only rural residents) 28
8. Comparison of experiences at private and public clinics (only urban residents) 29
i

Acknowledgements
Funding for this study was provided by the United Nations Development
Program (UNDP) and the World Health Organization (WHO).
The cooperation and support of the Ministry of Health (MOH) China, and the
Health Bureaus of Guangdong, Shanxi and Sichuan Provinces are gratefully
acknowledged.
The opinions expressed in this document, however, are entirely those of the
authors and do not reflect the views of the abovementioned organizations or the
institutions they individually represent.
ii

Abstract
The objective of this study was to gather quantitative and qualitative data so as
to facilitate evidence-based policy making in relation to the development and growth
of private medical practice in China. The study, carried out in the provinces of
Guangdong, Shanxi and Sichuan, consisted of: questionnaire surveys administered to
household residents and doctors; focus groups conducted with residents and doctors;
and interviews with key stakeholders, namely government health officials, private and
public sector health care managers and private health care investors. We found broad
consensus regarding the useful and complementary role that private medical practice
plays in China’s health care system, but there were serious concerns about the poor
regulatory environment as well. Dissatisfaction with the high costs, poor staff
attitudes, and general inefficiency of the public health care system appear to be
driving patients, both urban and rural, to seek cheaper but lower quality care from
solo private practitioners. Our findings point to the need to address issues of effective
regulation, equitable access, affordable costs, quality care and patient safety. A key
policy challenge for the Ministry of Health China will be to determine the framework
for future growth and development of the private health care sector, including the
appropriate public-private mix that will maximize efficiency gains while maintaining
the basic premise of equitable health care for all. We conclude with a list of specific
recommendations for action.
iii

Chapter 1. Introduction
Chapter 1
Introduction
China’s bold market reforms which began in the 1980s have contributed to
unprecedented economic growth benefiting the lives of millions of people. However,
they have also affected the health care of its citizens in ways that are still being
understood.
One consequence is the re-emergence and proliferation of private medical
practice. It is not clear what the true extent of private medical practice in the country
is at the moment, much less what the appropriate public-private mix should be. Of
particular concern are those situations where public providers have imposed user
charges, leaving few options for those without the ability to pay.
The development of the private health care sector, and the path that
privatization will take within the pubic sector, are likely to impact on the success or
failure of ongoing health care reforms. Yet, little information is available (e.g. what
services are being offered, at what cost, to whom, and what controls are in place) to
inform and guide policy-makers with respect to the role and scope of private medical
practice in China, and the appropriate framework for its development. Research is
also needed to elucidate the views and perspectives of key stakeholders -- consumers,
practitioners, health care managers, investors, and officials -- who collectively (driven
by differing motives and incentives) shape China’s health care system.
A collaborative study was thus undertaken to generate information that will
support evidence-based policy formulation with respect to the future development of
private medical practice in China. The study, commissioned by UNDP, WHO, and
MOH China, was carried out in three provinces --Guangdong, Shanxi and Sichuan.
The research team was led by Dr.Lim Meng Kin (WHO International
Consultant) and comprised Dr. Yang Hui, Dr. Zhang Tuohong, Dr. Zhou Zijun and
Dr. Feng Wen (all from Peking University), and Dr. Chen Yude (Ministry of Health).
The provincial research collaborators were Dr. Chen Shaoxian (Guangdong
University), Dr. Liu Yi (Sichuan University), and Dr. Zhen Jianzhong (Shanxi
Medical University).
Objective
The objective of the study was to gather information to facilitate evidencebased
policy making in relation to the development and growth of private medical
practice in China.
1

Chapter 1. Introduction
Research questions
Specifically, the study sought to shed light on:
Research activities
• the current situation with respect to private medical practice in the
three provinces;
• the reasons why consumers use private medical services;
• the affordability of private medical services to consumers, compared to
pubic medical services;
• the willingness and ability of consumers to pay for private medical
services;
• the expectations and attitudes of practitioners, consumers and health
officials towards private medical practice;
• the attitudes and opinions of practitioners, consumers and health
officials on part-time private medical practice for doctors in the public
health care system;
• the regulatory mechanisms currently used to permit private medical
practice; and
• the attitudes and opinions of practitioners, consumers and health
officials on the necessary controls for private medical practice in
China.
The following research activities were carried out:
• interviewer-administered questionnaire survey of 3600 households in
the three study provinces, and involving both rural and urban areas;
• self-administered questionnaire survey of 720 medical practitioners in
the three provinces, including both rural and urban areas, and public
and private sectors;
• a total of 24 focus group sessions for patients and practitioners in the
three provinces, including both rural and urban areas;
• interviews with selected key informants, namely health officials, health
care managers in both the public and private sectors, and private health
care investors in all three provinces; and
• review of documents and compilation of additional data obtained from
MOH and the respective health bureaus of the three provinces.
The study took one year (January to December 2001) to complete. The
preliminary results were presented to MOH officials, local experts and academics at a
workshop held on 1 March 2002 at Peking University, during which valuable
feedback and constructive comments were received.
2

Chapter 1. Introduction
Organization of report.
This report is organized into five chapters, beginning with this introductory
chapter on why the project was carried out, and what the research questions and
activities were. Chapter two expands on how the study was carried out, including the
methodology for data collection and analysis. Chapter three reports on the main
findings in six parts, namely: from official sources, from the household questionnaire
survey; from the doctors’ questionnaire survey; from the residents’ focus groups;
from the doctors’ focus groups; and from the interviews with key informants. Chapter
four synthesizes the salient findings, and explores the key policy implications.
Chapter five concludes with a list of recommendations for action.
As far as possible, details are banished to the Annexes which are found at the
end of the report. These include samples of the questionnaires for the household and
doctors’ surveys; listings of the official documents pertaining to private medical
practice issued by the national and provincial authorities; and the detailed analyses for
the household and doctors’ surveys.
3

Chapter 2. Methodology
Chapter 2
Methodology
Data collection
A combination of approaches, both quantitative and qualitative, was used to
generate the required information. The data collection methods included:
• questionnaire survey,
• focus group,
• interviews with key informants (health care managers,
health officials and investors),
• review of official documents
Selection of study provinces
We purposefully selected three geographically disparate provinces, namely
Guangdong, Shanxi and Sichuan for study, based on their different stages of
economic development, and the availability of suitable research collaborators in the
provinces.
Figure 1: Geographical location of the three study provinces in China
Guangdong
Area: 177600 sq. km
Population: 71 million
GDP per capita US$ 1354
Shanxi
Area:156000 sq. km
Population: 32 million
GDP per capita US$ 612
Sichuan
Area: 485000 sq. km.
Population: 84 million
GDP per capita US$ 527
4

Chapter 2. Methodology
Guangdong, situated in the southern-most coastal region of China, has the
distinction of being one of two provinces that were first opened to foreign direct
investments in 1980, and hosting three of China’s four special economic zones. Its
high degree of autonomy to handle its own economic affairs has enabled it to surge
ahead of others economically.
Shanxi is a landlocked province noted for its coal and electric power industry,
situated along the middle reaches of the Yellow River in the western part of north
China, while Sichuan is a largely agricultural province located in the Upper Yangtze
Valley in the southwestern part of the country.
In terms of per capita GDP, Guangdong ranks fifth in China, compared to
Shanxi (seventeenth) and Sichuan (twenty-fifth) (Table 1).
Table 1. Economic development in China by province, 1998
Ranking Province GDP/Per Capita (US$) Population (million)
1 Shanghai 3,433 14.64
2 Beijing 2,246 12.46
3 Tianjin 1,799 9.57
4 Zhejiang 1,367 44.56
5 Guangdong 1,354 71.43
6 Fujian 1,260 32.99
7 Jiangsu 1,218 71.82
8 Liaoning 1,134 41.57
9 Shandong 987 88.38
10 Heilongjiang 917 37.73
11 Hebei 793 65.69
12 Hubei 765 59.07
13 Xinjiang 757 17.47
14 Hainan 732 7.53
15 Jilin 719 26.44
16 Mongolia Interior 616 26.44
17 Shanxi 612 31.72
18 Hunan 602 65.02
19 Henan 573 93.15
20 Chongqing 569 30.6
21 Anhui 556 61.84
22 Jiangxi 545 41.91
23 Qinghai 531 5.03
24 Yunnan 529 41.44
25 Sichuan 527 84.93
26 Ningxia 519 5.38
27 Guangxi 495 46.75
28 Shaanxi 466 35.96
29 Tibet 452 2.52
30 Gansu 420 25.19
31 Guizhou 285 36.58
*Source: China Human Development Report, UNDP, 1999. Statistical information according to
Statistical Yearbook of China, 1998.
5

Chapter 2. Methodology
Selection of City/County
Within each province, two rural and two urban sites were purposefully
selected for study. This was done in close consultation with the respective provincial
health bureaus, and included site visits by the research team to determine their
suitability for study.
1. Questionnaire Survey
Two separate questionnaire surveys were conducted, one for households and
one for doctors.
a. Household questionnaire survey
An interviewer-administered questionnaire survey was carried out on a total of
3600 households (i.e. 1200 each) in the three study provinces. Both rural and urban
residential areas (i.e. 600 each) were covered.
Population
The household questionnaire was administered to heads of household or
equivalent -- defined as any person living in the house, male or female, aged 18
years or more, and who is a Chinese permanent resident. Selection was determined
by multi-stage cluster sampling, as follows:
The health bureaus of the three Provinces were each asked to suggest urban
cities and rural counties that are fairly “typical” of the province, and known to have
private medical practice (clinics, and preferably hospitals as well – although it was
understood that the latter would be hard to find in the rural areas). Another criterion
was that support was likely to be forthcoming from the local government and health
department officials for such a study. The following list was arrived at:
Table 2: Study provinces and the respective cities and counties
Study province
Guangdong
Shanxi
Sichuan
(Population figures 1999)
City
(population)
Shenzhen
(1,200,000)
Taiyuan
(3,000,000
Leshan
(3,450,000)
County
(population)
Haifeng
(710,000)
Yangqu
(140,000)
Weiyuan
(750,000)
6

Chapter 2. Methodology
Selection of District/Township
Two urban districts and two rural townships from each city or county
respectively were then randomly selected from a list of all districts/townships,
arranged from the biggest to the smallest according to population size, as follows:
Cumulative population was computed for both lists, from the first district/township to
the last. The first district (for city) or township (for county) respectively was selected
based on the cumulative population that was closest to a random number generated.
The second district or township respectively was selected based on the cumulative
population which was closest to the midpoint between the first district/township
chosen and the final cumulative population. The names of the two districts or
townships were then affirmed by the local health department.
Selection of residential area
Residential areas were defined according to the residential committees in
charge of these areas. Within each city or county, two urban residential committees
and two rural village committees were randomly selected. The method of the selection
was the same as for the district or township. The households under the jurisdiction of
the residential/village committee would constitute the cluster of households to be
studied.
Selection of household
The target sample population was 150 households from the total number of
households within the jurisdiction of each residential committee or village committee.
To cater for non-response, 180 households were randomly selected from each, as
follows:
The list of households was compiled based on house number, block, and/or
known size of family. As the total number of families in the community or village was
known, the sampling interval was determined by dividing the number of families by
180. The first household was selected on the basis of a computer-generated random
number. The rest of the households were then determined according to the sampling
interval. The names of heads of households and their addresses were then recorded.
The last 30 households were designated as “reserve households”, for replacing nonresponding
households if necessary. No replacements were used once the number of
households interviewed had reached 150.
Selection of respondent
One respondent per household was interviewed. The inclusion criteria were:
living in the household, regardless of residential registration; either male or female;
and 18 years and older. The exclusion criteria were: below 18 years of age; mentally
or cognitively impaired; too sick or weak to answer questions; unable to answer
questions because of other reasons, e.g. physical impairments; and inability to use
mandarin or for any other reason, unable to communicate with interviewer.
7

Chapter 2. Methodology
The head of household was defined as either parent (father or mother) of a
nuclear family. Should the head of household be unavailable, any other person who
fulfills the above criteria was interviewed instead.
The sampling frame was arrived at thus: (see Figure 2):
• 3600 households in three provinces,
• 1200 households in each province.
• 600 households in each county or city.
• 300 households in each district or township.
• 150 households in each residential area.
Figure 2. Typical sampling frame for province
PROVINCE
CITY
COUNTY
District 1 District 2 Township 1 Township 2
Residential committee 1
(150 households)
Residential committee 1
(150 households)
Village committee 1
(150 households)
Village committee 1
(150 households)
Residential committee 2
(150 households)
Residential committee 2
(150 households)
Village committee 2
(150 households)
Village committee 2
(150 households)
Sample size
The sample size of 600 for each city (= urban area) or county (= rural area)
was based on a precision target of 95% level of confidence.
Survey Instrument
A locally-contextualized questionnaire was developed (see Annex A for
sample). In addition to ascertaining the health seeking behavior of residents, the
questionnaire contained customized question sets designed to gauge respondents’
level of satisfaction with the quality of care and services received from four groups of
providers, i.e.
• Public hospital (inpatient care)
• Private hospital (inpatient care)
• Public clinic (outpatient care)
8

Chapter 2. Methodology
• Private clinic (outpatient care)
The questions asked covered the full spectrum of patient experiences (ranging
from satisfaction with providers to ratings of quality of services) as well as opinions
on pertinent issues (see Figure 3).
Figure 3. Structure of the household questionnaire
1. Screening
question
Opinions on
2. a. health care in general
b. private medical practice
Rating
Ranking
Agreement
Open-ended
Experience of
A : Public hospital
B : Private hospital
C : Public clinic
D. Private clinic
Satisfaction with:
Accessibility
Cost
Responsiveness
Service quality
Medical care quality
Outcome
Overall rating
3. Socio-demographic data
A 5-point Likert-style response scale was used, which had the advantage of
allowing for additive scoring of individual items as well as the derivation of summary
indices or overall scores for specific domains under study.
Well-established techniques founded on psychometric theory and addressing
well-known sources of bias such as social desirability, reward and reinforcement
effect, cognitive dissonance/incongruity effect, and response set bias, were
incorporated into the design of the questionnaire.
The questionnaire was designed in English, translated into Chinese, and then
back-translated into English and the two versions harmonized. The questions were
framed in such a way as to be sensitive to the nuances of the Chinese (mandarin)
language. Only the Chinese version was used in the fieldwork. It was pre-tested with
a random sample of 10 households in Beijing and further refined before final printing.
Definition of private practice
The definition of “private hospital” and “private clinic” was based on
9

Chapter 2. Methodology
ownership. All non-governmental institutions were defined as “private.”
The definition of “private doctor” is based on the employer being nongovernment,
or self. Hence, a doctor in solo practice in an individually owned private
clinic is a “private doctor”. The same goes for a doctor employed by a private
hospital.
Interviewers
The questionnaires were administered by medical students who had received
the requisite training. Fieldwork was undertaken under the supervision of the
research collaborators from the three provincial universities, during their vacation in
August 2001.
Consent
Participation was strictly voluntary. Invitations were made through letter,
followed by actual house visits. Participants were assured that all information
obtained would be treated with the strictest privacy and confidentiality.
b. Doctors’ questionnaire survey
A self-administered questionnaire survey was carried out on a total of 720
practitioners in the three study provinces. Doctors from both rural and urban health
facilities were covered, as well as the public and private sectors.
Population
The doctors were conveniently selected from the public and private hospitals
and clinics located at or near the sites of the household survey.
The health facilities and doctors were non-randomly selected in consultation
with the local health bureaus, according to the following criteria:
• Urban public hospital: hospital nearest the household survey site
• Urban private hospital: hospital nearest the household survey site
• Rural public hospital – the county People’s Hospital.
• Rural private hospital: one or more private hospitals in the county, until
the required number of doctors was met.
• Urban public outpatients’ clinics: community hospital at the household
survey site.
• Urban private clinics: private clinics in the vicinity of household survey
site
• Rural public clinics: township health center at the household survey site.
• Rural private clinics: private clinics in the county.
10

Chapter 2. Methodology
Within the larger facilities (pubic and private hospitals) the doctors
participating in the study were chosen from among the various departments by the
hospital director. For the smaller rural and urban private clinics, private doctors in
private clinics were nominated by officials of the Health Bureau.
The doctors recruited at each facility were assembled at a single location,
given instructions for filling out questionnaires by the researchers themselves, and
asked to fill out the survey forms independently. Anonymity and confidentiality were
assured. Completed questionnaires were collected on the spot by researchers.
A target number of 240 doctors in each province were surveyed - 120 in rural
and 120 in urban areas (Figure 4).
Figure 4: Distribution of doctors surveyed in each province
Province
City
County
Private
(N=60)
Public
(N=60)
Private
(N=60)
Public
(N=60)
As it turned out, 656 questionnaires (Guangdong 240, Shanxi 202 and Sichuan
214) were completed and entered into the analysis (see Annex F).
Survey Instrument
The self-administered questionnaire (see Annex B for sample) used a similar 5-
point Likert-scale as for the household questionnaire. Questions covered the following
areas:
• General opinion on the health care system
• Perceived problems with the health care system
• Opinion towards public and private practice
• Individual satisfaction with career and professional development
• Demographic data and general information including medical education.
The questionnaire was designed in English, translated into Chinese, and then
back translated into English. Both versions were harmonized before printing, but only
the Chinese version was used in the fieldwork.
11

Chapter 2. Methodology
2. Focus Groups
Focus groups were conducted for both residents and doctors:
• a total of 12 focus groups was conducted for residents in the three
provinces, and covering both rural and urban areas
• a total of 12 focus group sessions was conducted for doctors in the three
provinces, and covering both rural and urban areas.
a. Residents’ Focus Groups
Focus groups, designed to elicit in-depth insights and an understanding of
motivations and perceptions of participants, were conducted for each of the residential
areas surveyed.
Two focus groups were conducted for each area. Participants were selected
upon recommendation of the respective residents’ committees. There were on
average, 10 participants to each group. The provincial professors on the research
team of collaborators acted as moderators.
The discussions centered on the following themes:
• Problems encountered with the existing health care system
• Opinion on role of private medical practice in their province
• Opinion on government encouragement of the private health care sector
• Opinion on the need for regulation of private sectors
• Opinion on part time work of public doctors in private sector
b. Doctors’ Focus Groups
Two focus groups were similarly conducted for doctors in each of the survey
areas. Participants were selected upon nomination of the respective health bureaus.
There were on average, 10 participants in each group, which invariably had a mix of
private and public practitioners. The provincial professors on the research team of
collaborators acted as moderators.
Doctors’ focus groups explored the following issues:
• Role of private medical practice
• Cost and quality issues
• Whether government should encourage more private health facilities
• Opinion on a range of issues including medical advertisements, part-time
private practice for public doctors and regulation of the health sector.
12

Chapter 2. Methodology
3. Interviews with selected key informants
The following selected key informants were personally interviewed by the
provincial professors on the research collaboration team in each of the three
provinces.
• 8 selected health officials ((3 from Guangdong, 3 from Sichuan, and 2
from Shanxi)
• 6 selected private health care investors (2 from each province):
• 15 selected health care facility managers (5 from Shanxi, 4 from
Guangdong and 4 from Sichuan; 8 are from the private sector, while 5 are
from the public sector)
The following issues were explored:
• Role of private medical practice
• Whether government should encourage growth of the private sector
• Part time work of public doctors in private sector
• Regulation of the health sector
• Other concerns.
4. Review of documents from official sources
Additional information was obtained from a number of official documents
pertaining to private medical practice in China. These comprised national documents
obtained from the MOH (Department of Healthcare Management and Centre of
Health Statistic Information) (see Annex C) and provincial documents obtained from
the Provincial Health Bureaus and City/County Health Bureaus (see Annex D). The
aim was to gain an understanding of the policy contextual background to the
development of private medical practice in China.
Healthcare statistics (1995 to 2000) were also obtained, as was information
relating to private healthcare facilities and foreign joint venture healthcare facilities.
Training
To achieve common ground among all research team members and the
provincial research collaborators, training workshops were conducted by the WHO
consultant at Peking University, on the objective and design of the study, the
techniques and methodologies for questionnaire design and analysis, and practical tips
on the conduct of questionnaire surveys, focus groups and interviews.
The provincial researchers, in turn, conducted training workshops for field
investigators (medical students from the respective medical universities) in the
provinces. As part of the provincial investigators’ training, a pilot study involving 50
households was carried out, but the results were excluded from the database of the
main survey.
13

Chapter 2. Methodology
All field investigators (medical students) for the surveys were required to pass
a test at the end of the training. University teaching staff were deployed as supervisors
of the household survey. They took charge of the organization, checking of the
completed questionnaires, and field re-investigations, where necessary.
Quality control
Data integrity was assured by quality control mechanisms throughout all
phases of data collection, data entry, and data analysis.
Trained field investigators (medical students) administered all the
questionnaires. Supervisors and interviewers of household survey were responsible
for the reliability and completeness of the questionnaires. Interviewers were required
to check the completed questionnaires each day while the supervisors checked the
completed questionnaires at the end of each day. If necessary, interviewers had to reinvestigate
to rectify any mistakes made. For quality control, supervisors personally
re-investigated 5% of households.
Data entry and analysis
Computer data entry using Microsoft Excel was double-checked for data entry
errors. If a discrepancy was found in the questionnaire during data entry, the original
questionnaire was returned to the field investigators for rectification.
Data analysis involved univariate, bivariate, and multivariate analyses using
SPSS version 11.0.
14

Chapter 3. Results part 1
Chapter 3
Results
Part 1: Main findings from official sources
Twenty years have passed since the legalization of private medical practice in
China. In this section, we briefly summarize the status of private medical practice in
China according to information from official sources.
The re-emergence and official sanctioning of private medical practice (which
was banned during the cultural revolution) apparently coincided with the dismantling
of the rural Cooperative Medical System (CMS), the latter occurring along with the
dismantling of other administrative structures as a consequence of China’s sweeping
economic reforms. CMS coverage was so markedly reduced that to survive, the vast
majority of village clinics had to be transformed into privately owned ones, operating
on a fee-for-service basis. At the same time, because of the lack of public funding,
many rural health workers -- particularly rural doctors already dissatisfied with poor
working conditions – were drawn to the urban areas by better remuneration and
working conditions.
In the urban areas, existing insurance schemes experienced serious financial
difficulties, aggravated by the rapid diffusion of expensive, high-tech medical care,
poor awareness and understanding of the inflationary impact of market-based
medicine, and insufficient risk-pooling protection schemes for employees of local
government and state-run enterprises who were previously enjoying free care. Despite
numerous adhoc cost-containment measures in the 1980s and risk-pooling measures
since 1992, as well as decentralization of responsibility for the health insurance funds
from the central to the provincial level since 1998, major problems remain. It is
against this backdrop that fee-for-service private medical practice has flourished in
the cities.
As early as 1980, the Ministry of Health reviewed the situation in a landmark
Report on the Granting of Permission for Solo Private Medical Practice which
recommended legalizing private medical practice and regulating it strictly. In 1985,
the State Council directed that private medical practice should be encouraged and in
1987, the State Bureau of Industry and Commerce Administration granted permission
to public sector health professionals to own and operate private medical clinics after
their retirement from public service.
In 1988, the Ministry of Health and the State Bureau of Traditional Medicine
Administration jointly issued a set of regulations spelling out the criteria for the
establishment of private medical practices. Included in these regulations were details
of the licensing process and the penalties for non-compliance. In 1989, the Ministry of
Health allowed part-time private medical practice in public health care facilities. In
1992 the State Pricing Bureau and the Ministry of Finance jointly promulgated the
standard administration fees for the establishment of private medical facilities.
15

Chapter 3. Results part 1
Between 1993 and 1994 the Ministry of Health and the State Bureau of
Industry and Commence jointly laid down the Methods of Administration of
Advertisements for Medical Services and Medications. In 1994, the Ministry of Health
issued Basic Standards Of Healthcare Facilities (Draft) and Key Principles Of
Distribution Of Healthcare Facilities, but made no mention of how private health
facilities would fit into the overall master plan.
In 1997, the State General Bureau of Industry and Commence and the State
General Bureau of Tax issued separate requirements for registration of private
medical practice and taxation. In 1998, the Ministry of Health issued a regulation that
made it illegal to operate a medical practice without a license from the State Bureau
of Tax and urged all private doctors and health care facilities to comply with tax
registration. In the same year, the Ministry of Health issued The Notice of Enhanced
Management of Employment of Social Health Workers which regulated the
management and employment of non-institutional medical health workers.
Since 2000, the Ministry of Health has required all medical facilities to be
registered as either non-profit or for profit entities.
A list of relevant official documents reviewed by the study team is given in
Annex C.
In addition, we reviewed a number of regulations on private medical practice
promulgated by the Provincial governments. A list of these documents in given in
Annex D.
It can be seen that there are adequate rules and regulations already laid down,
ranging from prescribed examinations and minimum standards for the licensing of
medical practitioners, through the minimum standards and monitoring of health care
facilities, to the fees and taxes levied by different government agencies. A point to
note is the large number of agencies involved in the issuing and administration of the
regulations..
Table 3 shows additional statistics compiled from official sources, which
reveal some basic information on the status of health care facilities in the three study
provinces, as well as the cities/counties that were studied.
The combined population of the three study provinces accounted for one sixth
of total Chinese population. Based on GDP and average individual income,
Guangdong is economically more developed than Shanxi and Sichuan. Urban
residents have also much higher income than rural residents.
Private health care providers can be divided into “private hospitals” and
“private clinics”. There are altogether 5792 public hospitals and 192 private hospitals
in the three provinces combined. Private hospitals comprise only a small percentage
(3.3%) of the total number of hospitals. Sichuan has the most number of private
16

Chapter 3. Results part 1
hospitals (84), followed by Guangdong (64) and Shanxi (44). As for private clinics,
there are 14,665 in Sichuan, 8455 in Shanxi, and an indeterminate number in
Guangdong.
Among the urban and rural sites studied in each province (data for the entire
province were unavailable), the highest concentration of private clinics is found in
Taiyuan city in Shanxi Province (4.4 per 10,000 population), followed by Shenzhen
city in Guangdong Province (2.6 per 10,000 population) and Leshan city (1.8 per
10,000 population) in Sichuan Province.
The highest concentration of private clinics among the rural areas is in Yangqu
County in Shanxi Province (2.1 per 10,000 population) followed by Haifeng in
Guangdong Province and Weiyuan in Sichuan, which have the same concentration
(1.3 per 10,000 population).
Table 3. Basic statistics compiled from official sources for study provinces, cities and counties (1999)
Guangdong Shanxi Sichuan
Province Shenzhen
City
Haifeng
County
Province Taiyuan
City
Yangqu
County
Province
Leshan
City
Weiyuan
County
Area (10,000km 2 ) 17.8 0.2 0.2 15.6 0.7 0.3 48 1.3 0.1
Population (10,000) 7298.9 119.9 71.2 3203.6 300 14 8316 345.1 74.9
Average individual income 9125(U*) 20240 3511 4342(U) 6019 1181 5127(U) 4947 2080
3628(R*)
1772(R)
1789(R)
GDP (yuan) 11596 35896 8397 4727 3620 4339 3950 3954
No. medical institutions# 8699 687 39 16500 3338 197 75217 1323 629
No. hospitals 2415 76 12 2634 149 14 935 455 512
Public hospitals 2351 70 25 2590 132 14 851 324 426
Private hospitals 64 6 2 44 17 0 84 3 0
Private hospitals per
0.09 0.50 0.28 0.14 0.57 0.00 0.10 0.09 0.00
100,000 pop.
No. private clinics 317 97 8455 1379 29 14665 610 92
No. per 10,000 pop. 2.6 1.3 4.4 2.1 1.8 1.3
Health Manpower 320423 18841 1520 152123 20000 895 11663 1499
Private health manpower 8667 867 161 26245 3060 76 935 186
Private health manpower 1.19 7.23 2.26 8.19 10.20 5.43 2.71 2.48
per 10,000 pop.
Consultations (10,000) 10383 2051 108 4547 836 3.6 6416 730 140
Private (10,000) 110 269 31 0.9 250 20
Private consultation per
10,000 pop.
150.71 22435.36 4353.93 642.86 7244.28 2670.23
* U- Urban areas, R- Rural areas
# does not include private clinics.
= data unavailable
17

Chapter 3. Result part 2
Part 2: Main findings from the household questionnaire survey
Response rate
There were 3730 respondents to the household questionnaire, giving a
response rate of 95.6%.
Profile of respondents
Overall, females (55%) outnumbered males (45%), a pattern that was
consistent for all three provinces and for both rural and urban residents (Table 4).
The mean age was 45 years (SD=15.4years).
Half of the respondents had attained a minimum educational standard of junior
middle school.
The vast majority (83%) were married.
Farmers constituted the largest occupational group (40%) followed by retirees
(16%). In the rural areas, farmers alone comprised 78% of the respondents.
71% of respondents had no health insurance of any kind. The percentage of
uninsured was much higher in the rural (90%) than in urban areas (51%).
The median annual household income range was 5000 to 9999 yuan.
Guangdong residents were the richest: 51% of households had with annual
income exceeding 20000 yuan. This was about 5 times more than in Shanxi (10%)
and 9 times more than in Sichuan (6%). Sichuan residents were the poorest, having
the highest number of households with annual income of less than 2000 yuan (19%),
compared to Shanxi (14%) and Guangdong (6%).
Utilization of medical services
64%.of respondents visited a doctor during the past 12 months. 82% of these
visits were made within the last 6 months.
There was no significant difference between urban (65%) and rural (62%)
residents in their utilization of health care services in the past 12 months (Table 5).
About 53% of the last visit was to public hospital (Table 6). However, it should be
noted that most of these visits were outpatient visits as many of the public outpatient
clinics are located within public hospitals.
18

Chapter 3. Result part 2
Table 4. Profile of household respondents by province and residential area
Socio-demographic
Variables
All
(N=3730)
Province
Guangdong
(N=1200)
Shanxi
(N=1200)
Sichuan
(N=1330)
Residential area
Urban
(N=1864)
Rural
(N=1866)
Gender
Female 55.5 50.5 56.1 59.4 57.1 53.8
Male 44.5 49.5 43.9 40.6 42.9 46.2
Age
Mean/SD 45.0 (15.4) 38.0 (14.1) 48.1 (14.8) 48.4 (14.9) 46.0 (16.5) 43.9 (14.1)
18-29 16.8 30.8 10.7 9.7 18.2 15.3
30-39 24.9 30.3 21.3 23.3 22.5 27.3
40-49 21.8 18.3 25.3 21.9 19.4 24.2
50-59 15.1 10.4 14.6 19.8 13.9 16.3
60-69 13.5 6.6 18.7 15.2 15.5 11.6
70+ 7.9 3.7 9.6 10.1 10.5 5.2
Educational level
No education 10.9 7.7 10.9 13.9 5.9 16.0
Primary school 25.9 22.8 18.5 35.3 15.3 36.4
Junior middle school 32.2 25.6 39.2 31.8 28.9 35.4
Senior middle school 19.5 23.6 21.5 14.0 28.0 11.0
Junior college 7.0 11.8 5.8 3.7 12.9 1.0
Bachelor degree & above 4.6 8.5 4.2 1.4 8.9 0.2
Marital status
Never married 10.8 22.5 5.8 4.8 13.2 8.4
Married 82.6 75.5 89.0 83.5 78.7 86.7
Divorced/widowed/others 6.5 2.1 5.2 11.7 8.1 4.9
(Missing) 0.1
Occupation
Government officer 2.0 3.7 1.7 0.9 3.3 0.8
Manager/ executive 13.7 21.3 12.2 8.3 25.4 2.0
Clerk/ serviceman 6.0 7.9 7.0 3.5 10.6 1.5
Self-employed 8.0 12.2 6.2 5.8 9.7 6.3
Farmer 39.5 33.3 37.7 46.7 1.1 77.8
Unemployed 10.0 8.2 8.3 13.2 15.4 4.7
Student/part timer/others 5.2 8.9 3.6 3.3 5.9 4.5
Retired 15.5 4.7 23.4 18.3 28.7 2.5
Health insurance
Yes 28.6 31.2 34.9 20.4 47.8 9.3
State health insurance 20.4 20.8 24.9 15.9 37.0 3.8
Cooperative health
insurance
2.4 0.4 6.9 0.1 0.3 4.4
Company health
insurance
5.8 10.0 3.1 4.4 10.5 1.1
No 70.5 68.2 63.5 78.9 50.9 90.0
Annual household income
(Yuan)

Chapter 3. Result part 2
Table 5. Health care utilization in the past 12 months
Total
Province
Type of residential area
Guangdong Shanxi Sichuan Urban Rural
2372 (63.6) 876 (73.0) 751 (62.6) 745 (56.0) 1213 (65.1) 1159 (62.1)
Figures in brackets are in percentages
Table 6. Health care facility last visited in the past 12 months
Total
Province
Guangdong
Residential area
Shanxi Sichuan Urban Rural
Private hospital 4.7 11.6 0.7 0.5 8.0 1.2
Public hospital 53.0 46.4 61.6 52.2 69.6 35.9
Private clinic 32.5 34.5 24.7 38.1 13.0 52.8
Public clinic 9.8 7.5 13.1 9.2 9.5 10.1
Figures are in percentages
The final model of the multivariate analysis using Cox regression with the
‘backward selection’ method revealed several sociodemographic factors that
independently affected health care utilization in the past 12 months (Table 7). It
showed that people living in Guangdong and Shanxi province, rural area, female,
having health insurance, with poor self-reported health status, and earning higher
income were more likely to use health services in the past 12 months.
Table 7. Multivariate analysis for past health care utilization
Variables
RR & 95% CI
Province
Guangdong 1.30 (1.15-1.47)
Shanxi 1.14 (1.03-1.27)
Sichuan* 1.00
Type of area
Urban 0.88 (0.80-0.98)
Rural* 1.00
Gender
Male 0.89 (0.81-0.96)
Female* 1.00
Health insurance
No 0.89 (0.80-0.99)
Yes* 1.00
Health status
Very poor, poor, fair 1.37 (1.26-1.50)
Good and very good* 1.00
Income
Less than 2000 0.79 (0.66-0.95)
2000-4999 0.80 (0.68-0.95)
5000-9999 0.80 (0.69-0.92)
10000-19999 0.86 (0.75-0.98)
20000 and above* 1.00
Reference group
20

Chapter 3. Result part 2
Unmet need
Half (50%) of the respondents experienced at least one occasion in the last 12
months when they did not get to see a doctor even though they needed to see one.
Multivariate analysis showed the significant determinants of unmet need to be:
Residents of Shanxi and Sichuan provinces, urban residents, higher education, poor
health status, and lower household income (Table 8).
Table 8. Multivariate analysis for unmet need due to any reasons
Variables
RR & 95% CI
Province
Guangdong* 1.00
Shanxi 1.41 (1.23-1.62)
Sichuan 1.10 (0.96-1.28)
Type of area
Urban 1.16 (1.04-1.29)
Rural* 1.00
Education level
No education* 1.00
Primary school 1.12 (0.94-1.33)
Junior middle school 1.20 (1.01-1.42)
Senior middle school 1.22 (1.00-1.48)
Junior college 1.46 (1.14-1.86)
Bachelor degree or above 1.54 (1.18-2.02)
Health status
Very poor, poor, fair 1.43 (1.30-1.58)
Good and very good* 1.00
Income
Less than 2000 1.32 (1.08-1.62)
2000-4999 1.30 (1.07-1.58)
5000-9999 1.17 (0.98-1.40)
10000-19999 1.00 (0.84-1.18)
20000 and above* 1.00
* Reference group
The main reason given for not visiting the doctor was cost (49%). The second
most frequent reason given was “I did not want to make a fuss of it” (38%) --
indicating that many who decided to forgo seeing a doctor did so because they
considered their conditions to be not serious or life-threatening (Table 9). This reason
may also explain why people with higher education had higher percentage of unmet
need (further analysis of the subgroup who said cost was the main reason did not
show association with higher education).
Table 9. Main reason for the unmet need
The main reason for the unmet need were
Cost too much 903 (48.8)
Did not want to make a fuss 698 (37.7)
Could not spare the time 96 (5.2)
Other reasons 90 (4.9)
The clinic/hospital was too far 23 (1.2)
Poor attitude of health care staff 8 (0.4)
(Figures in bracket are percentage)
21

Chapter 3. Result part 2
Among those who said that cost was the main reason for their unmet need
(N=903), the significant influencing factors were province, type of area, health status,
and annual household income. People of Shanxi and Sichuan, living in urban area,
having poor health status, and lower income were more likely to have unmet need due
to cost (Table 10).
Table 10. Multivariate analysis for unmet need due to cost
Variables
RR & 95% CI
Province
Guangdong* 1.00
Shanxi 2.98 (2.31-3.85)
Sichuan 2.02 (1.55-2.63)
Type of area
Urban 1.28 (1.10-1.49)
Rural* 1.00
Health status
Very poor, poor, fair 1.81 (1.56-2.11)
Good and very good* 1.00
Income
Less than 2000 3.06 (2.20-4.26)
2000-4999 2.80 (2.03-3.85)
5000-9999 2.21 (1.62-3.00)
10000-19999 1.59 (1.16-2.19)
20000 and above* 1.00
* Reference group
We further analyzed this group who experienced an episode of “unmet need”
by dividing it into two subgroups, i.e. (a) unmet need, with no utilization of health
care at all in last 12 months, and (b) unmet need, with utilization of health care on
other occasions within the last 12 months.
By eliminating the latter category, we arrived at a smaller subgroup of people
(n = 613 or 16 % of total) who could truly be considered to have genuinely “unmet
need", as they did not enter the health care system at all for the whole year, despite a
felt need to do so. The profiles of those in this category are shown in Table 11.
Table 11. “Genuine” Unmet need, defined as those who needed to see a doctor but did
not get to see any doctor at all in the last 12 months
Characteristics
Unmet need
(due to any reason; N=613)
Gender
Male 46.8
Female 53.2
Provinces
Guangdong 17.8
Shanxi 38.7
Sichuan 43.6
Type of area
Urban 53.7
Rural 46.3
Figures are in percentages
22

Chapter 3. Result part 2
The final model of multivariate analysis using Cox regression (Table 12)
showed that the significant factors influencing “unmet need” were: province
(Shanxi>Sichuan>Guangdong), urban residential area, male gender, no health
insurance and lower household income.
Table 12. Factors that independently affecting “genuine” unmet need in the past 12-
month
Variables
RR & 95% CI
Province
Guangdong* 1.00
Shanxi 2.23 (1.72-2.90)
Sichuan 1.90 (1.45-2.48)
Type of area
Urban 1.58 (1.31-1.90)
Rural* 1.00
Gender
Male* 1.00
Female 0.80 (0.68-0.94)
Health insurance
No 1.24 (1.00-1.53)
Yes*
Income
Less than 2000 2.30 (1.58-3.35)
2000-4999 2.15 (1.51-3.08)
5000-9999 1.94 (1.40-2.69)
10000-19999 1.49 (1.07-2.06)
20000 and above* 1.00
* Reference group
Utilization of private medical services
About 33% of household survey respondents reported that their last visit was
to a private clinic. Only 5% sought treatment at a private hospital, and 1% was
admitted to a private hospital. In view of the small number of patients treated at
private hospitals, further comparative subgroup analysis was done only for private
clinics and public clinics.
The significant factors affecting the utilization of private clinics are shown in
Table 13. People from Sichuan and Guangdong, rural areas, and having health
insurance were more likely to visit private clinics.
Table 13. Factors independently affecting utilization of private clinics
Variables
RR & 95% CI
Province
Guangdong 0.85 (0.74-0.98)
Shanxi 0.66 (0.56-0.78)
Sichuan* 1.00
Type of area
Urban 0.56 (0.48-0.65)
Rural* 1.00
Health insurance
Yes 1.18 (1.00-1.41)
No* 1.00
* Reference group
23

Chapter 3. Result part 2
Commonly seen conditions at private clinics
As expected, relatively minor conditions like sore throat, common cold, upper
respiratory tract infection, gastrointestinal disorders, and gynecological disorders
constituted the main clinical conditions seen at both private and public clinics (Table
14).
Patients with more serious conditions like hypertension and heart problems,
pneumonia and other disorders of respiratory system, cerebrovascular disease, ear and
gall bladder disorders tended to go to public hospitals.
Table 14. The most common conditions (top 5) seen at the various health care facilities
Rank Private hospital Public hospital Private clinics Public clinics
1 common cold 27.3 common cold 13.6 common cold 46.1 common cold 33.3
2 reproductive
disorders
6.4 gastroenteritis 4.3 gastroenteritis 4.2 phayrngitis 4.3
3 phayrngitis 4.5 hypertension 4.2 influenza 3.8 hypertension 3.5
4 gastroenteritis 4.5 musculoskeletal
disorders
4.1 phayrngitis 3.6 gastroenteritis 3.5
5 influenza 3.6 reproductive
disorders
Figures are in percentages
3.4 hypertension 1.8 reproductive
disorders
3.0
Patient satisfaction: comparing experiences at private and public clinics
2876 respondents who visited at least one of the health care facilities (i.e.
public hospital, private hospital, public clinic or private clinic) responded to questions
on their level of satisfaction with their last encounter at these institutions (Table 15).
Table 15. Respondents who answered questions on ratings of their experiences with health care
facilities
In the past 12-month
All
Province
Residential area
Guangdong Shanxi Sichuan Urban Rural
Admitted to public hospital 298 (11.0) 123 (10.8) 97 (12.9) 78 (9.6%) 218 (16.7) 80 (5.7) ***
Admitted to private hospital 35 (1.3) 32 (2.8) 2 (0.3) 1 (0.1) *** 29 (2.2) 6 (0.4) ***
Visited public clinic 1460 (54.0) 422 (36.9) 568 (75.6) 470 (58.1) *** 894 (68.6) 566 (40.4) ***
Visited private clinic 1083 (40.3) 469 (41.3) 223 (29.7) 391 (48.8) *** 350 (27.1) 733 (52.5) ***
Figures in bracket are in percentages; *** P

Chapter 3. Result part 2
Comparisons between levels of satisfaction with private and public clinics
were made, based on 21 question items which, when collapsed, reflect 8 domains of
patient satisfaction (Table 16). Cronbach alpha of the 21 items was 0.90 (95% CI=
0.89-0.91) using the Two-Way Random Effect Model, indicating good internal
reliability.
Table 16. Eight domains of patient satisfaction measured (outpatient clinic)
I. Accessibility V. Medical Responsiveness
Q5 The waiting time till the appointment to see doctor Q1 Convenience of location
Q7 Ambience of the clinic
II. Cost
Q13 Doctor involved you in solving your health problem
Q3 Reasonableness of your medical cost
Q15 The ability to see doctor of your own choice
Q17 Attitude (respect and concern) shown by the doctor
III. Service Quality
Q18 Assurance of confidentiality
Q2 Courtesy and manners of staff
Q4 Efficiency of the registration process
VI. Overall satisfaction.
Q6 The waiting time till the procedure/ examination done Q19 Willingness to recommend this clinic to others
IV. Medical Care Quality
Q8 Doctor’s explanation of health problem
Q9 Doctor’s explanation of medical procedures/ tests
Q10 Doctor’s explanation of the prescribed medicines
Q11 Advice on ways to manage health problem
Q12 Thoroughness of physical examination
Q14 Standard of medical treatment
Q16 Attention and care shown by doctor
VII. Overall outcome of your care
Q20 Outcome of care
VIII. Overall quality of care and services
Q21 Overall quality of care and services
Overall, respondents expressed greater satisfaction levels with private clinics
than with public clinics in most of the items (Figure 5).
Patients were more satisfied with their private clinic experiences in all 8 key
domains (Table 17).
However, further examination of the individual items showed that those who
visited private clinics were less satisfied with the ambience of the clinic, technical
standard of medical treatment, the ability to see a doctor of their own choice, than
those who visited public clinics (see Table 18). The technical standard of medical
treatment in public clinics (54%) was consistently rated as better than for private
clinics (48%).
As an indication of their overall satisfaction level, 55% of private clinic
patients were willing to recommend their doctors to their relatives and friends,
compared to 44% for public clinic patients.
25

Chapter 3. Result part 2
Figure 5 Comparison of experiences at private clinics and public clinics (overall)
Overall quality of care and services
Outcome of care
Willingness to recommend clinic to others
Assurance of confidentiality
Respect and concern by doctor
60.3
56.1
70.4
62.5
54.8
51.0
73.3
62.6
74.2
85.1
Attention and care by doctor
66.9
79.8
Ability to see doctor of own choice
Standard of medical treatment
Patient involved in solving health problem
43.4
51.3
47.0
54.0
47.9
40.9
Thoroughness of physical examination
71.8
71.6
Advice on managing health problem
Doctor’s explanation of medicines
Doctor’s explanation of medical procedures
Doctor’s explanation of health problem
54.4
51.6
54.0
47.8
44.2
45.5
58.4
58.1
Ambience of clinic
47.7
65.4
Waiting time till examination done
68.2
81.9
Waiting time till seen by doctor
Efficiency of registration process
81.5
71.4
83.2
94.3
Reasonable cost/ affordability
31.2
50.1
Courtesy and manners of the staff
Convenience of location
76.8
75.5
89.7
90.1
Public clinic
Private clinic
0 20 40 60 80 100
% Very good and good
26

Chapter 3. Result part 2
Table 17. Comparison of key domains of patient satisfaction between
public clinic visitors and private clinic visitors
Characteristics
Private clinic visitors
(N=1073)
Public clinic visitors
(N=1450)
I. Accessibility
Mean score (95% CI) 4.09 (4.03-4.14) 3.46 (3.40-3.51)
% good and very good 80.9 58.6
II. Cost
Mean score (95% CI) 3.32 (3.26-3.38) 2.76 (3.70-2.81)
% good and very good 47.6 26.4
III. Service Quality
Mean score (95% CI) 4.31 (4.27-4.34) 3.72 (3.68-3.76)
% good and very good 92.3 66.7
IV. Medical care quality
Mean score (95% CI) 3.56 (3.52-3.60) 3.33 (3.29-3.37)
% good and very good 55.5 44.2
V. Medical responsiveness
Mean score (95% CI) 3.76 (3.72-3.80) 3.59 (3.55-3.62)
% good and very good 67.8 58.6
VI. Overall satisfaction
Mean score (95% CI) 3.41 (3.34-3.47) 3.15 (3.08-3.21)
% good and very good 54.5 43.8
VII. Overall outcomes
Mean score (95% CI) 3.68 (3.63-3.73) 3.41 (3.36-3.46)
% good and very good 67.0 56.0
VII. Overall quality and services
Mean score (95% CI) 3.64 (3.60-3.69) 3.47 (3.43-3.52)
% good and very good 60.0 52.5
Table 18. Comparison of specific items of patient satisfaction, in which
public clinics fared better than private clinics
Characteristics
Private clinic visitors
(N=1073)
Public clinic visitors
(N=1450)
Ambience of the clinic
Mean score (95% CI) 3.41 (3.36-3.46) 3.61 (3.56-3.65)
% good and very good 46.0 61.6
Technical standard of medical treatment
Mean score (95% CI) 3.46 (3.41-3.51) 3.51 (3.46-3.55)
% good and very good 47.9 54.2
The ability to see doctor of their own choice
Mean score (95% CI) 3.18 (3.09-3.27) 3.32 (3.26-3.38)
% good and very good 45.1 50.9
27

Chapter 3. Result part 2
Regardless of type of residence (urban or rural), private clinics were again
consistently rated higher than public clinics for most of the items except for ambience
of the clinic, technical standard of medical treatment, and the ability to see a doctor of
own choice (Figures 6 and 7).
Figure 6 Comparison of experiences at private and public clinics (only rural residents)
Overall quality of care and services
Outcome of care
Willingness to recommend clinic to others
Assurance of confidentiality
Respect and concern by doctor
Attention and care by doctor
Ability to see doctor of own choice
Standard of medical treatment
Patient involved in solving health problem
Thoroughness of physical examination
Advice on managing health problem
Doctor’s explanation of medicines
Doctor’s explanation of medical procedures
Doctor’s explanation of health problem
Ambience of clinic
Waiting time till examination done
Waiting time till seen by doctor
Efficiency of registration process
Reasonable cost/ affordability
Courtesy and manners of the staff
Convenience of location
31.2
60.3
56.1
70.4
62.5
54.8
51.0
73.3
62.6
85.1
74.2
79.8
66.9
43.4
51.3
47.0
54.0
47.9
40.9
71.8
71.6
54.4
51.6
54.0
47.8
44.2
45.5
58.4
58.1
47.7
65.4
81.9
68.2
81.5
71.4
94.3
83.2
50.1
76.8
89.7
75.5
90.1
Public
Private
0 10 20 30 40 50 60 70 80 90 100
% Very good and good
28

Chapter 3. Result part 2
Figure 7. Comparison of experiences at private and public clinics (only urban residents)
Overall quality of care and services
50.2
59.3
Outcome of care
Willingness to recommend clinic to others
38.8
59.9
51.8
53.8
Assurance of confidentiality
61.2
73.3
Respect and concern by doctor
64.6
81.1
Attention and care by doctor
Ability to see doctor of own choice
Standard of medical treatment
45.3
48.7
50.7
49.8
54.3
66.4
Patient involved in solving health problem
34.9
49.0
Thoroughness of physical examination
52.6
64.6
Advice on managing health problem
Doctor’s explanation of medicines
Doctor’s explanation of medical procedures
39.6
38.5
42.5
50.6
50.6
56.4
Doctor’s explanation of health problem
Ambience of clinic
42.4
47.5
58.2
59.2
Waiting time till examination done
Waiting time till seen by doctor
53.9
50.6
79.1
79.6
Efficiency of registration process
71.1
90.3
Reasonable cost/ affordability
23.4
42.5
Courtesy and manners of the staff
63.4
88.3
Convenience of location
76.5
71.1
Public
Private
0 10 20 30 40 50 60 70 80 90 100
% Very good and good
29

Chapter 3. Result part 2
Relative importance of factors affecting choice of doctors
All respondents, irrespective of whether they usually go to a public or private
doctor, were asked to rank in order of importance, those factors considered to be
important when choosing a doctor.
The fact that the doctor gives good quality of care was ranked the most
important consideration (94%), followed by doctor’s attitude – respect shown (88%)
and concern shown (88%). Next came affordability (80%), followed by doctors’
reputation (72%). Significantly, both rural and urban residents ranked all five items in
exactly the same order. (Table 19)
Table 19. Factors influencing choice of doctors
Factors Total Urban Rural
Good Quality of care 94.0 92.9 95.0
Concern shown by doctor 87.9 87.4 88.5
Respect shown by doctor 87.5 86.8 88.1
Affordability of medical expenses 79.6 74.5 84.6
Doctor’s reputation 72.4 67.3 77.5
Opinions on health care quality, access, and cost issues.
Respondents were asked to rate on a five point scale (1 = very poor, 5 = very
good), what they thought of the health care system serving their locality in terms of
quality, access and cost issues.
Table 20. Respondents’ evaluation of the health care system
Questions
Very poor, poor
& fair (%)
Good & very
good (%)
Total
Number
The skill level of public doctors in general 25.7 74.4 (3480)
Your access to medical care when you need it 36.5 63.5 (3617)
Your access to emergency care when you need it 37.6 62.4 (3386)
Your access to a doctor of your own choice 50.6 49.4 (3271)
Your access to specialist care when you need it 59.8 40.1 (3084)
The skill level of private doctors in general 73.1 27.0 (3160)
Your affordability upon the medical cost 84.6 15.4 (3693)
The truthfulness of advertisements of health facilities in the media 85.2 14.8 (3252)
Residents generally gave good ratings for (Table 20):
• the skill level of doctors in the public sector,
• their access to emergency care when they need it, and
• their access to medical care when they need it.
30

Chapter 3. Result part 2
However, they gave poor ratings to:
• the truthfulness of advertisements of health facilities in the media,
• affordability of medical expenses, and
• the skill level of private doctors.
Opinions on various issues concerning the health care system in general
Respondents were asked to indicate on a five point scale, whether they
strongly disagreed (1 point) or strongly agreed (5 point) with a number of statements
designed to probe attitudes and opinions on various issues concerning the health care
system in general.
Rural residents were generally more favorably disposed toward private
medical services. In particular, they came out strongly on three items: their preference
to be seen by private doctors, their desire for the government to encourage the setting
up of more private clinic and hospitals (Table 21).
Table 21. Opinions of residents in urban and rural areas concerning health care system
(% agree and strongly agree)
Total Urban Rural
1. When I’m sick, I prefer to be seen by a private doctor than a public doctor 28.7 17.2 40.1
2. Public hospitals provide a higher standard of care than private hospitals 78.1 72.3 83.9
3. Health care is a government responsibility; government should pay for the bulk of the 57.8 55.7 59.9
people’s health care expenditure.
4. The government should encourage more private hospitals to be set up 45.0 33.7 56.2
5. Doctors in the public sector should be allowed to have private medical practice parttime,
36.5 26.7 46.6
to supplement their income
6. I trust Traditional Chinese Medicine more than I trust Western Medicine 30.8 27.8 33.7
7. I prefer to see a doctor who practices both Chinese and Western Medicine 74.3 71.0 77.6
8. Doctors in private practice tend to over prescribe medicines for patients 57.1 59.9 54.5
9. Doctors in public practice tend to over prescribe medicines for patients 58.6 63.6 53.2
10. Doctors in private practice have better skills/ techniques than those in public practice 8.1 8.7 7.7
11. I find health care costs too high and unaffordable 69.9 70.4 69.8
12. The government should encourage more private clinics to be set up 41.6 28.6 54.3
13. Private hospitals give patients a better quality of service 53.3 52.5 54.1
14. Private clinics give patients a better quality of service 50.1 46.9 52.9
15. Health care is an individual responsibility; people should pay for the bulk of their
own health care expenditure
34.9 26.7 42.9
Multivariate analysis showed that those who agreed that “government should
encourage more private hospitals to be set up” tended to be people of Guangdong
province, living in rural area, with at least a bachelor degree, having relatively poor
self-reported health status (see Table 22), whereas those who agree that “government
31

Chapter 3. Result part 2
should encourage more private clinics to be set up” tended to be people of
Guangdong province, living in rural area, being male, and having relatively good selfreported
health status people (see Table 23)
Table 22. Multivariate analysis for being in favor of setting up more private hospitals
(% agree and strongly agree)
Variables
RR & 95% CI
Province
Guangdong 1.31 (1.15-1.48)
Shanxi 0.90 (0.79-1.03)
Sichuan* 1.00
Type of area
Urban 0.60 (0.53-0.68)
Rural* 1.00
Education level
No education 0.83 (0.63-1.11)
Primary school 0.79 (0.61-0.98)
Junior middle school 0.76 (0.59-0.98)
senior middle school 0.67 (0.51-0.87)
Junior college 0.85 (0.64-1.14)
Bachelor degree or above* 1.00
Health status
Very poor, poor, fair 1.00
Good and very good* 0.91 (0.82-1.00)
* Reference group
Table 23. Multivariate analysis for being in favor of setting up more private clinics
(% agree and strongly agree)
Variables
RR & 95% CI
Province
Guangdong 1.14 (1.00-1.30)
Shanxi 0.94 (0.83-1.08)
Sichuan* 1.00
Type of area
Urban 0.58 (0.51-0.66)
Rural* 1.00
Gender
Male 1.10 (1.00-1.23)
Female* 1.00
Education level
No education 1.20 (0.86-1.68)
Primary school 1.13 (0.83-1.55)
Junior middle school 1.05 (0.77-1.42)
senior middle school 0.86 (0.63-1.17)
Junior college 0.96 (0.67-1.37)
Bachelor degree or above* 1.00
Health status
Very poor, poor, fair 0.88 (0.79-0.98)
Good and very good* 1.00
* Reference group
32

Chapter 3. Result part 3
Part 3: Main findings from the doctors’ questionnaire survey
Profile of respondents
A total of 656 doctors answered the self-administered questionnaire. For
logistical reasons, neither the health care facilities nor the doctors within these
facilities were randomly selected. Hence, the findings may not be representative or
generalizable.
The respondents were evenly distributed among the provinces, and equally
divided between the urban and rural areas in each province.
There were more males (58%) than females (42%) in the sample. The mean
age was 41 years (SD = 12 years). The doctors in the public sector were significantly
younger (37 years) than those in the private sector (45 years). They also tended to be
western-trained (81% compared to 66% for private doctors). But private doctors
tended to earn more, with 41% earning more than 20,000 yuan annually compared to
21% for public doctors (Table 24).
Doctors in the rural areas tended to be younger (38 years) than those in urban
areas (43 years) (Table 25). About 70% earned an annual income of below 20,000
yuan. Doctors practicing in Guangdong province earned significantly more than those
in Sichuan or Shanxi. Guangdong doctors were also better educated; 43% were
university graduates and 84% had western-style medical training. In all, 10% of
doctors had less than 3 years of medical training.
The majority worked in public hospitals (35%) and public clinics (21%). The
rest were from private clinics (29%) and private hospitals (17%).
33

Chapter 3. Result part 3
Table 24. Profile of doctors by practice settings
Practice settings
Characteristics
All (N=655)
Public (N=364)
Private (N=291)
P values
Gender
Male 58.0 52.5 64.9 **
Female 42.0 47.5 35.1
Age
Mean/SD) 40.5 (12.2) 37.0 (10.3) 44.8 (12.9) ***
Annual Income (yuan)
Less than 10000 38.3 46.4 28.2 ***
10000-19999 31.6 32.1 30.9
20000-29999 13.0 6.6 21.0
30000 and above 17.1 14.8 19.9
Educational level
Primary & secondary school 2.3 0.6 4.5 *
High school 34.4 35.5 33.0
College 35.8 35.5 36.1
University 27.5 28.4 26.5
Type of medical training
Western-style univ or medical college 74.2 80.8 66.0 ***
Chinese traditional medical univ or college 17.6 14.8 21.0
Others, self-trained, learned from
experienced masters
8.2 4.4 13.1
Length of medical training
less than 3 yrs 9.9 6.6 14.1 **
3-3.9 yrs 40.6 45.3 34.7
4-4.9 yrs 16.9 17.0 16.8
5 yrs and above (incl others) 32.5 31 34.4
Province
Guangdong 36.6 32.7 41.6
Shanxi 30.7 33.2 27.5
Sichuan 32.7 34.1 30.9
Type of area
Urban 53.9 50.8 57.7
Rural 46.1 49.2 42.3
Figures are in percentages; *P

Chapter 3. Result part 3
Table 25. Profile of doctors by provinces and urban/rural area
All
(N=656)
Guangdong
(N=240)
Province
Shanxi
(N=202)
Sichuan
(N=214)
Urban
(N=353)
Residential area
Rural
(N=303)
Gender
Male 58.1 72.5 46.5 52.8 *** 56.4 60.1
Female 41.9 27.5 53.5 47.2 43.6 39.9
Age
Mean (SD) 40.5 (12.2) 42.1 (12.4) 41.9 (12.8) 37.3 (10.6) *** 42.5 38.1 (11.2) ***
(12 6)
Annual Income (yuan)
Less than 10000 38.4 7.5 65.8 47.2 *** 31.4 46.5 ***
10000-19999 31.6 32.1 23.8 38.3 24.9 39.3
20000-29999 13.0 21.7 6.4 9.3 15.0 10.6
30000 and above 17.1 38.8 4.0 5.1 28.6 3.6
Educational level
Primary & secondary school 2.3 2.1 3.0 1.9 *** 0.8 4.0 ***
High school 34.5 18.8 41.1 46.0 20.4 51.0
College 35.7 36.7 35.6 34.7 36.0 35.4
University 27.5 42.5 20.3 17.4 42.8 9.6
Type of medical training
Western-style univ or
medical college
74.2 83.8 63.9 73.4 *** 75.1 73.3 *
Chinese traditional medical
univ or college
17.5 10.4 22.3 21.0 19.3 15.5
Others, self-trained, learned
from experienced masters
8.2 5.8 13.9 5.6 5.7 11.2
Practice settings
Public hospital 35.0 24.6 30.3 50.9 *** 31.2 39.4 *
Public clinic 20.6 25.0 29.9 7.0 21.2 19.9
Private hospital 16.6 25.0 14.4 9.3 19.8 12.9
Private clinic 27.8 25.4 25.4 32.7 27.8 27.8
Length of medical training
less than 3 yrs 10.1 5.8 10.9 14.0 *** 6.8 13.9 ***
3-3.9 yrs 40.5 35.8 43.6 43.0 31.4 51.2
4-4.9 yrs 16.9 14.2 14.9 22.0 15.3 18.8
5 yrs and above 32.4 44.2 30.7 21 46.4 16.2
Overall rating of the present health care system
Overall, 32% rated the present health care system in their province as “good
and very good”.
There were differences in opinion between the provinces and between public
and private practitioners, with doctors from Guangdong (49%) and the private sector
(44%) giving significantly higher ratings (Table 26).
35

Chapter 3. Result part 3
Table 26. Overall rating of the present health care system
No.
Mean
Score
95% C.I.
% good and very good (Unadj) RR
Overall 656 3.10 3.03 3.16 32.2
Province
Guangdong 240 3.43 3.33 3.52 48.8 2.82 (1.95-4.08)
Shanxi 202 3.02 2.89 3.15 28.2 1.63 (1.08-2.47)
Sichuan 214 2.80 2.69 2.91 17.3 1.00
F=31.9, p=0.000
Chi-sq=53.4, p=0.000
Type of area
Urban 353 3.16 3.07 3.26 34.3 1.15 (0.88-1.52)
Rural 303 3.02 2.92 3.11 29.7 1.00
F=4.5, p=0.03
Chi-sq=1.6, p=0.21
Practice settings
Public 364 2.90 2.81 2.99 22.3 1.00
Private 291 3.34 3.24 3.44 44.3 1.99 (1.51-2.63)
F=41.3, p=0.000
Chi-sq=36.2, p=0.000
When asked to rank in order of importance the problems facing health care in
their own province, affordability was ranked the number one problem, followed by
access and quality. However, the degree to which each of these was perceived as a
problem was low: only 28% felt that there were serious problems with affordability,
23% with accessibility and 20% with quality of care. In other words, the majority of
respondents did not consider the present health care system to have serious problems
of affordability, access or quality, and this was consistently the case with further subgroup
analysis for differences between provinces, between urban and rural
practitioners, and between private and public practitioners (see page 4, Annex F).
Opinions towards private medical practice
As to whether private medical practice plays a useful role, opinion was equally
divided (50%). Further subgroup analysis revealed that the cleavage was mainly along
the public-private practice setting line, with only 20% of public doctors agreeing that
the “private sector plays a useful role” compared to 88% of private doctors (Table
27).
36

Chapter 3. Result part 3
Table 27. Opinions towards health care system
Strongly disagree,
disagree, neither
%
Agree and
strongly agree
Total No
Private health facilities have a useful role to play in my province’s health care
49.7 50.3 (646)
system
There is a need to encourage more private health facilities to be set up 62.2 37.8 (650)
It is difficult to start up a private medical practice in my province 47.7 52.3 (615)
I think the health authorities in my province are not supportive of private medical 64.2 35.8 (602)
practice in my province
It is acceptable for private health facilities to make profits 42.3 57.7 (652)
It is acceptable for public health facilities to make profits 43.2 56.8 (651)
Advertisement of health care facilities should be strictly regulated 7.8 92.2 (654)
Health care is a government responsibility, government should pay the bulk of
37.5 62.5 (653)
health care costs
Health care is an individual responsibility, people should pay the bulk of health
76.5 23.5 (655)
care costs
Private medical services should be closely monitored for compliance with
8.0 92.0 (655)
regulation
Public medical services should be closely monitored for compliance with
8.3 91.6 (654)
regulation
Doctors in the public sector should be allowed to have part-time private practice
62.7 37.3 (647)
outside of the hospital they work in to supplement their income
Doctors in the public sector should be allowed to have part-time public practice
62.4 37.6 (649)
outside of the hospital they work in to supplement their income
I am presently underpaid for the work that I do 24.3 75.6 (644)
Given a choice between private and public, I would rather work in a private health
care facility
46.9 53.0 (630)
Need to encourage more private health facilities
As to whether “there is a need to encourage more private health facilities to be
set up”, 38% agreed overall. But again, public sector doctors agreed much less (18%)
than private doctors (63%). There was a rural-urban divide in opinion as well, with
rural doctors showing less agreement (27%) than urban doctors (47%).
Multivariate analysis showed urban practitioners and educational level
(university) as the independent factors associated with support for the establishment
of more private clinics (Table 28).
37

Chapter 3. Result part 3
Table 28. Need to encourage more private clinics
Variables RR 95% CI
Type of area
Urban 1.28 0.95 1.72
Rural*
Educational level
Primary & secondary school 0.71 0.28 1.79
High school 0.57 0.40 0.81
College 0.66 0.48 0.90
University*
Need for close monitoring and regulation
The overwhelming majority believed that the health sector, regardless of
whether it is the private or public sector, needed to be closely monitored for
compliance with regulations. 92% said it was necessary for the sector and 92 % said it
was necessary for the public sector.
Subgroup analysis revealed no significant differences in responses between
the provinces, between urban/rural settings and between private/public practice
settings (see page 10, Annex F).
Medical advertisements
An overwhelming majority (92%) agreed that “the advertisement of health
care facilities should be strictly regulated”.
Subgroup analysis revealed no significant differences in responses between
the provinces, between urban/rural settings and between private/public practice
settings (see page 8, Annex F).
Part time private medical practice for public doctors
Only a minority (37%) agreed that “doctors in the public sector should be
allowed to have part-time private practice outside of the hospital they work in to
supplement their income”.
Multivariate analysis showed that factors independently associated with
support of this statement were those with more than 5 years of medical training,
males, older doctors, and public sector practitioners (Table 29).
38

Chapter 3. Result part 3
Table 29. Part time private medical practice for public doctors
Variables RR 95% CI
Practice settings
Public 1.33 1.01 1.75
Private*
Gender
Male 1.49 1.13 1.95
Female*
Length of medical training
less than 3 yrs 0.67 0.42 1.07
3-3.9 yrs 0.67 0.50 0.89
4-4.9 yrs 0.62 0.42 0.92
5 yrs and above (incl others)*
Other salient findings
Other salient findings on the opinion toward health care system were as
follows (see Table 27, and also Annex F for subgroup analyses):
• 52% agreed that “It is difficult to start up a private medical practice in my
province”. More private doctors (61%) than public doctors (45%) agreed
with this statement.
• 36% said “I think the health authorities in my province are not supportive
of private medical practice in my province”. Again, more private doctors
(42%) than public doctors (31%) agreed with this statement.
• 58% said “It is acceptable for private health facilities to make profits”.
Again, more private doctors (76%) than public doctors (43%) agreed with
this statement.
• 63% believed that “health care is a government responsibility; government
should pay the bulk of health care costs”. More public doctors (71%) than
private doctors (52%) agreed with this statement.
• 24% believed that “health care is an individual responsibility; people
should pay for the bulk of health care costs”. More private doctors (31%)
than public doctors (17) agreed with this statement.
• 76% said “I am presently underpaid for the work that I do”. More public
doctors (81%) than private doctors (69%) agreed with this statement.
• 53% said that “given the choice between the private and public sector, I
would rather work in a private health care facility” More private doctors
(62%) than public doctors (46%) agreed with this statement.
39

Chapter 3. Result part 3
Satisfaction with current medical practice
Finally, respondents were asked about their satisfaction levels with their
current job, level of skill, income, relationship with patients, opportunity for
continuing medical education, interaction with other practitioners, and availability of
supporting laboratory and X-ray backup services.
In general, respondents were dissatisfied with all of the above, except for their
relationship with patients (with 60% expressing satisfaction, and with no significant
difference between doctors in private and public sectors (Table 30).
Table 30. Satisfaction with current medical practice
% (N=656)
Very dissatisfied,
dissatisfied, neither
Satisfied and
very satisfied
My relationship with my patients 39.7 60.4
My present level of skill as a medical practitioner 69.5 30.5
My opportunity for interaction with other practitioners 71.1 29.0
My present job 73.0 26.9
Professional laboratory and X-ray backup available for my practice 78.5 21.5
My opportunity to continuing medical education 81.8 18.1
My present income 91.9 8.1
The least satisfying item was income (only 8% felt satisfied -- 14% for private
doctors and 3% for public doctors), followed by opportunity for continuing medical
education (only 18% felt satisfied, with no significant difference between private and
public doctors).
The majority were dissatisfied with their opportunity for continuing medical
education (82%) and opportunity for interaction with other practitioners (71%).
40

Chapter 3. Result part 4
Part 4: Main findings from residents’ focus groups
The role of private health sector
The majority said that the private sector provided a useful alternative to the
public sector. They observed that many who cannot afford treatment at the public
hospitals would turn to private clinics. This was especially so in the rural areas.
Cost was a major issue of concern. One person from Shanxi cited the example
of an old lady with neither offspring nor income, who was stricken with cancer, and
all she could do was wait for her death at home. Before she understood the nature of
her illness, she had to endure the pain and resort to pain-killers because she could not
afford to be examined at the hospital.
A recurring complaint was “the public hospitals charge too much; we end up
paying for a whole list of items’.
Although they found ‘the big hospitals” too expensive, many said they would
have no choice should they be seriously ill “because the big hospitals have good
quality of care”. Some would go to the expensive public hospitals “to make sure of
the diagnosis” and return to the cheaper private clinics for follow-up treatment.
A few (urban residents from Guangdong) said that the private sector was
needed because it was beyond the capacity of the government to establish enough
hospitals to serve the people.
Problems with the private sector
The majority touched on the problem of unqualified doctors in private
practice, especially in the private clinics.
“There are too many quacks in the clinics …we don’t know their standards. It is said that
there are barefoot doctors and animal doctors there. Those doctors who are graduates of medical
schools are quite different.”
The majority also mentioned “fake drugs” as another major problem with the
private clinics, whose sources of drugs were suspect.
They also mentioned the “administrative mess” in the supervision the private
clinics by the authorities. For example,
“Some doctors are not qualified enough to run the clinics but they managed to buy a license”,
and “there are too many private doctors. Some doctors obtained certificates even though they actually
failed in the examination”.
41

Chapter 3. Result part 4
Poor equipment in the private clinics was also mentioned as a problem. For
example,
“The clinics cannot tackle complicated problems because they have no equipment”, and
“Private clinics small in size so they cannot provide a thorough examination”.
Some questioned the moral scruples of private doctors.
“They treat your minor disease as a serious disease for the purpose of charging more
money”.
“Some private doctors have no ability to cure the disease, but for the sake of making money
will keep asking you to come back to them. Meanwhile the disease becomes worse”.
Another problem concerned the health insurance system. Many residents with
health insurance said they could not get reimbursed by their health insurance when
they visited private doctors.
Dissatisfaction with the public sector
The most commonly mentioned source of dissatisfaction with the public sector
was medical expenses. Some reasons offered were:
“The doctor prescribes more drugs for you because their bonus is related to the volume of the
drugs they prescribe”.
“The big hospital charges a service fee for the prescription. The price of the same drug is
100% higher in the hospital than in the drug store in front of the hospital”.
“In the big hospital, they will charge you for everything”.
The second most common problem mentioned was bad attitude – one person
likened it to an occupational disease afflicting medical staff. But there were moderate
views as well, e.g. :
“They are good at attitude when they are not busy”. “Some nurses are good but some are bad
at attitude”.
“Complicated”, “inconvenient” and “low efficiency” were some of the words
used to describe the public medical services (both clinics and hospitals). Some
complained that doctors in the public sector are not caring towards patients. Some
said that giving doctors additional money was quite important.
“The doctor will “succeed in the treatment or operation once you give him some money”.
42

Chapter 3. Result part 4
Plus points of the private sector
Many observed that the environment of the private hospitals was better. They
felt that the bigger private hospitals are better equipped and better managed. The
attitude, quality and efficiency of service was better compared to the public hospitals.
Many appreciated the convenient location and lower expenses of the private
clinics. Payment was also more flexible:
“We could defer payment in the private clinics and hospitals’.
The opening hours were also more flexible:
“You can come at any time” or, in the case of the modern urban clinics,
“What you need is just make a phone call … it saves time”.
On government encouragement to establish more private health facilities
The majority agreed that government should encourage more private health
facilities to be established. Many welcomed the idea of competition between public
and private sectors:
“We hope the competition will result in good service attitude and reasonable price”.
“Competition can provide more choices and convenience for the public”.
However, the majority qualified their support by saying the development should be
properly controlled and coordinated.
“The development of private hospitals should according to the regional development plan.”
“Private clinics should be limited because they lack the basic equipment and don’t shoulder
responsibility; they focus on making money”.
Some suggested that the numbers allowed must be capped just enough for the public
hospitals to learn how to manage themselves better through the process of
competition.
But a small minority simply said they did not favor having more private health
facilities because
“hospitals shouldn’t be left to the private sector; hospitals that serve the poor and elderly
should be operated by the government ”.
43

Chapter 3. Result part 4
Opinion on supervision of the private sector
The majority said the administration and supervision of private clinics should
be strengthened. They felt the present management was weak. The items needing
more regulation included: the qualification of medical doctors; the price of medical
services and drugs; the internal management of hospitals; the training of medical
doctors; and the types of services that private practitioners are allowed to provide.
On part time private medical practice for public doctors
The majority disagreed with the suggestion that part time private medical
practice be allowed for public doctors. The reasons cited included:
a. limited energy of the part of the doctor – “a doctor should be very tired after 8
hours working in the public hospital; he can hardly deal with the conflict between the
forthcoming benefit and his time’;
b. public doctors are responsible for caring for their patients all the time. “A
doctor should not consider his work finished after 5 pm”
c. the quality of service in the public sector would suffer. “The doctor in public
sector should not be allowed to do part time job because the doctor should put his whole
energy on his present job”.
Many suggested that doctors who were unhappy with their lot in the public
sector should make a switch to the private sector entirely:
“They cannot do both. It will be very harmful for the public”, and
“I agree with the supervision, communication and direction coming from the public sector to
the private sector, but I don’t agree with part time job for public doctors”.
A small minority supported the idea. One person said it should be allowed
because
“It is not a problem that we should worry about because there are regulations in both sectors
to ensure a responsible doctor”.
Another said:
“If he is capable, why not allow him to do so Now it is the time for reform and liberation!”
44

Chapter 3. Result part 5
Part 5: Main findings from doctors’ focus groups
The role of private medical practice in China
The majority of doctors considered the role of private medical practice to be
complementary to that of the public sector. They agreed that competition between
private and public sectors was good as it would encourage the public sector to be
more efficient. They also agreed that the existence of the private sector helps relieve
the pressure on the public sector.
However, some differences in opinion could be detected between doctors in
the private and public sectors. Below are some typical views of public sector doctors:
“The government should shoulder the responsibility for public health and primary health
care”
“China is too broad for a public sector to cover, especially the remote areas… I think the
private sector should work for the poor areas and poor people”.
“The public sector should be the main part of the health care system. There are limitations
with the private sector…”
“The private sector has a role in meeting demand of those who can afford better doctors,
services, accommodations, food, facilities and environments -- much like in the hotel
industry”.
“There are too many private clinics here…exceeding the number of restaurants and rice
shops, and most of them are not qualified.”
Below are what doctors from private sector said:
“Our private sector plays a positive role in the health care of the local people. The
procedures in the public hospital are too complicated and there are serious deficiencies. For
example, people who cannot afford it would not be admitted for proper treatment. Actually
there are many people who cannot afford it.”
“Private practitioners are more in touch with patients. The doctor in the private clinic
understands the real socio-economic status of patients much better than the public doctor. The
patients and we were originally neighbors. We understand what they really want. We open our
clinics at any time, unlike the public hospitals. There’s market competition between us and the
public clinics”.
“The private hospital is better at management. We are rewarded or punished based on our
efficiency and productivity. There is motivation for us to improve our own diagnostic
capabilities through continuous learning.”
Both public and private doctors agreed that patients with minor illnesses, e.g.
cough and colds and those with chronic, non-life threatening conditions, prefer to visit
private doctors. This is especially true in the rural areas. The public hospital is
usually seen as provider of last resort, attracting people with serious illnesses.
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Chapter 3. Result part 5
A doctor in the public sector opined:
“In a big city like Beijing, people might visit a major medical centre when they fall ill with the
common cold or diarrhea. But not so for the local patients, who would visit the private clinics.
Only people who are ill with serious disease such as heart attack and stroke come to our
public hospital. People usually seek cheaper curative services from private doctors after
laboratory tests have established their diagnosis and specific medication has been determined
at a public hospital”.
A doctor in the private sector said:
“Those not seriously ill tend to visit hospitals and clinics in the private sector. Those seriously
ill prefer public hospitals because it is a fact that the technical quality of service is much
better there than in the private sector”.
Problems with the private sector
The most frequent problem mentioned was the lack of, or low qualification of
medical staff, leading to low quality of medical care.
The second most frequently problem mentioned was the quality of medication.
Other problems mentioned were false advertisements, exaggerated cures, providing
services that exceeded the capability of the doctor, and poor instruments, equipment
and facilities.
One doctor in the public sector lamented:
“There are a lot of private clinics here - many are licensed through the under-the-table
approach. These doctors lack professional knowledge, give poor quality medical treatment,
and lack morals. All they want is money”.
“Private practitioners boldly treat patients with any medical condition, no matter what the
category of disease. Most use a whole range of medications even though they were only
trained in traditional Chinese medicine. It doesn’t matter what category or nature of disease
you have — they just use steroid hormones for treating patients with fever”.
Another doctor in private the private sector said something similar:
“The practitioners in private clinics portray themselves as being capable of curing any kind of
disease, even cancer. There’s too much fraudulent practice in the private sector. Last year,
there came a lot of so called “experts”, some claiming to be graduates of Beijing Medical
University! Private medical practice as a concept is good, but all these fake doctors and fake
drugs have turned the medical marketplace into a mess…”
Plus points for the private sector
Reasons cited for why people continue to visit private doctors included:
• relatively low and affordable expenditures
• good attitude of doctors
• convenience
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Chapter 3. Result part 5
• can be accessed at any time
• uncomplicated procedures of treatment
• flexible payment approaches
• good communication between doctors and patients in both private
hospitals and clinics
• good environment and complete management in the private hospitals.
The doctors in public sector said:
“The environment in private hospitals is nice. It is very convenient and you don’t have to wait
a long time, unlike public hospitals.”
“Our city has much unemployment. The unemployed cannot afford the charges in the public
hospitals. They have no choice but to see private practitioners or buy drugs from pharmacy
stores. The private clinics are convenient – intravenous infusion would be immediately
administered if necessary or the medication can be prescribed instantly”.
The doctors in a private hospital said
“If the patient cannot afford to pay, the private doctor might let him pay later or prescribe a
cheaper medicine.
“We don’t charge a registration fee, and we charge less than the public hospital for
laboratory tests. We order laboratory tests only when the patients really need it. Unlike the
public hospitals, we charge no additional fees for prescription and we prescribe only what is
necessary for patients”.
“We keep good relationships with patients by spending some time with the patients after the
diagnostic procedure.”
“We explain to patients about their situation, and give the reasons for prescribing the
medications. We try to reduce the mental burden on them.”
Dissatisfaction with the public sector
The doctors generally agreed that given the choice, many patients would not
like to visit public sector health facilities.
Doctors working in public hospitals narrowed down the reasons to bad
attitude, complicated procedures, and most importantly, high medical expenses. One
doctor gave the example of the hospital ward fee which, at 30 yuan per night, is a
heavy burden for majority of people.
Several doctors from private sector commented on the bad quality of services
and the occasional financial embarrassment of public hospitals. One said:
“The patients refuse to visit public hospital due to several reasons. First, it is too
complicated; second, it is bad in attitude; and third, the drugs are too expensive. For
example, patients have to spend 100 yuan or several hundred yuan even for minor illnesses
such as a common cold!”
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Chapter 3. Result part 5
On problems with the administration of private health facilities
The majority of doctors said that the administration of the private sector by the
authorities was not strict enough. Although the local health bureaus were responsible
for issuing licenses and for monitoring and supervising private clinics according to
prescribed standards, there were many private clinics without any licenses that could
freely operate with nobody supervising or punishing them. Sometimes, the health
bureau would close the clinic but they would reopen on another day.
Some doctors from Sichuan complained that the health bureau was abusing its
power to issue licenses for drug stores and private clinics, claiming that it issues
licenses liberally to those who gave the health bureau enough money.
Some doctors suggested that certification of doctors’ qualifications should be
carried out by a doctors’ association instead of the health bureau, because the health
bureau had a tendency to abuse its power.
Many doctors mentioned the need to strengthen the administration and
supervision of the private sector.
Many doctors from the private sector complained that the health bureaus
treated them differently from doctors in public sector. They were made to pay all
kinds of fees and in addition, were restricted in the number of drugs they can
prescribe. Moreover, the patients who consulted them could not be reimbursed even
though they had health insurance. Doctors who had retired from the public sector had
their pensions unfairly cut if they opened their own clinic.
Some doctors expressed concern with advertisements by medical institutions.
They said nobody checks on the truthfulness of the medical advertisements.
On whether the government should encourage more private health care facilities
The majority agreed that the government should encourage the establishment
of more private health facilities. Doctors (from both public and private sectors) said
that competition between public sector and private sector was necessary, “to improve
the quality of service and technical standards of public hospitals”. They said that “if
the private hospital is well run, it can provide an alternative to public hospitals if the
latter are badly run”. They also said that government should encourage free
competition and a policy of “survival of the fittest”. “Let them compete and the
market will decide who the winner is”.
Doctors from the private sector said that the number of private institutions
should be controlled. They felt that privatization “is a worldwide trend and since
China has adopted the idea for its industries, it is only natural, and a matter of time,
for hospitals to be divided into private and public”.
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Chapter 3. Result part 5
Some felt that the private sector should be encouraged but with the condition
that government should plan “the total number of hospitals according to the needs of
the community.” They said that private hospitals should operate in areas where
people cannot easily access public hospitals’. Some said that the government should
encourage private specialist hospitals but not private clinics in view of their ‘low
quality’.
On regulating the private sector
The majority said the government needed to exercise control over the private
sector through legislation and regulations. They also mentioned the need for regional
health planning “according to the size of the county or city, to reallocate resources so
as to avoid waste”. Some felt that
“Private clinics should be stringently checked and regulated. Those who have no techniques
and no certification should be gotten rid of“.
With regard to the detailed regulations needed they mentioned a string of
them, including: price regulation, regulation of medical advertisements, standards for
medical practitioners, and regulations on sources of drugs, the range of services that a
hospital or clinic can provide, continuing education and promotion of doctors in the
private sector, and hospital internal management, etc.
On part time private practice for public doctors
A minority disagreed completely because “it may affect the welfare of
patients.” They said that those who like private practice should make a switch to a
private hospital completely.
A minority agreed unconditionally. They said it was alright because
“You are selling your own techniques, not violating the law”.
The vast majority, however, agreed provided regulations were in place “to
make sure the doctor does not sleep the whole day in the public hospital and go to the
private hospital working for whole night”; “to ascertain who is qualified enough to do
part-time private practice in a private hospital”; and “to protect the quality of service
that the part time doctor provides to public patients”.
One doctor simply said,
“not now but in the future”.
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Chapter 3. Result part 6
Part 6: Main findings from interviews with key informants
(The key informants comprised public and private health care managers, private
health care investors and government health officials.)
The role of private medical practice
Private sector health care managers, private health care investors and Health
Bureau officials unanimously agreed that a healthy private medical sector would
stimulate reform in the public sector, resulting in improved quality of care and
services. They said it would also relieve the government of its burden of providing
health care services for the people and did not think that the private healthcare
facilities posed any threat to the public facilities.
Managers of public hospitals, however, saw it differently. In Shanxi and
Sichuan, managers of public health care facilities thought that the local public health
care facilities were already meeting the people’s needs. They feared that more private
clinics would “raid the market and affect public health care facilities greatly”.
A manager of a public hospital in Guangdong cautioned that
“If the government under-funded public hospitals while encouraging more private hospitals,
then the public facilities would lose out in the competition. Furthermore, public medical
facilities treat ordinary diseases and while private facilities are only interested in specialist
areas.”
A manager of a public hospital in Sichuan observed that private healthcare
facilities are competitive at the “lower end” of care:
“If lots of outpatients with minor illnesses go to the private sector the public health care
facilities would lose out financially.”
A manager of a public hospital in Sichuan said:
“At present, no private hospital in Sichuan is dominant enough to challenge the public
hospitals. The public hospital system is better developed, is of better quality and has a better
distribution network. Local people find it affordable. A large private hospital would be out of
place in the County”.
A manager of a public hospital in Shanxi said:
“There is a role for private hospitals, but my concern is with private clinics. They are
proliferating without a plan. There are too many clinics in Taiyuan city. They impact on the
public health care facilities. It is rare to find a private clinic of good quality is rare”.
One investor observed that:
“The medical quality of lots of clinics is very poor. Only those clinics run by retired public
doctors are of better quality.”
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Chapter 3. Result part 6
Investors of private facilities were upbeat about the future of private medial
practice. They considered private medical facilities an important part of the health
care system, which may even become the mainstream in the future. They felt that
competition is good as it will “improve service attitude, improve service quality, and
improve the present management system” in the public sector.
The scope of Private Medical Practice
Private hospitals are more established in the richer provinces like Guangdong,
and especially in progressive cities like Shenzhen (estimated at about 10% of market
share, with some focusing on specialty niches like ophthalmology and cosmetic
surgery). This contrasts with the situation in Shanxi where “there is not a single
private hospital that can compete with the public hospitals as they are poor in quality
and scope”. In Sichuan Province, there are not many private hospitals but many
private clinics accounting for about 30% - 40% of market share.
In general, private hospitals target the higher income group and tend to have a
specialty focus, while private clinics cater to “those with lower income, lower
education and lower social status, like the rural peasants”. Private medical clinics are
especially dominant in the rural areas of the three provinces.
Investors saw a market niche that is presently unfilled:
“Some private bosses can afford good quality services but the public hospitals can’t meet
their demand”.
Private facilities compared with public facilities
Almost all agreed that the technical quality of care in the public sector was
better. But the private sector was more affordable. It also had more flexible
management and was more responsive to patients’ needs in terms of service quality.
Health officials noted that private facilities do not provide emergency medical
services, intensive care and complicated surgery. They also do not provide preventive
medical services and health education. They noted that people went to big hospitals if
they have serious diseases. Hence, it will be a long way before private hospitals can
mount a serious challenge to public hospitals.
Costs
Everyone agreed that the private sector was more affordable, especially the
private clinics.
User charges in private hospitals can sometimes be more expensive than
public healthcare facilities but on the whole, they are cheaper. A manager of a private
specialist hospital in a city in Shanxi said:
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Chapter 3. Result part 6
“Sometimes, the cost in my hospital is a little more expensive than public hospitals. However,
patients are willing to pay more because we can cure their diseases. But generally, the cost of
treating ordinary diseases is not higher than public hospitals, even cheaper.”
Another manager of a private specialist hospital in Sichuan Province said
“We actually charge the same price as the City Hospital”.
On the plight of the poor, a health official in rural Shanxi lamented:
“Private clinics are cheaper then the township health center, and the township health center
is cheaper than the county hospital. While the officials working in the County government can
expect to be reimbursed 50% of inpatient fees and outpatient fees not exceeding 100 yuan, the
ordinary people have to “stretch their money” and try to “pay less and get more”. If a pig
were ill, the owner would do more for his pig! The local economic condition is very poor.”
The manager of a private hospital in Shanxi said
“The director of the private hospital can decide to reduce the charges if a patient is very poor
or he has not enough money”,
while the manager of a public hospital in Shanxi said
“The County Hospital must obey the pricing standards”.
Officials observed that residents wanted to seek value for money, but warned
that while the private sector was cheaper, there was also the problem of “fake
medications”.
A manager of a public hospital in Shanxi Province observed that
“Lots of clinics compete for market share based on lower prices. Patients are drawn mainly
by the lower prices”.
On why costs are lower in the private sector, a health official in Sichuan offered this
explanation:
“Fake medicine is one reason for the lower cost but not the main reason. The main reason is
that the cost of running the private clinic is very low. They don’t have heavy overheads. They
only charge fees for medication, not for registration, diagnosis and treatment.”
Remarked a health official in Shanxi Province:
“Their cost is cheaper because their medical care is substandard”.
Quality of Care:
Both managers and investors of private hospitals felt that good quality of care
will attract patients.
Investors of a private specialist clinic in Sichuan Province said:
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Chapter 3. Result part 6
“In a private healthcare facility, everyone has to work hard, learn and make progress
wholeheartedly, sharing in the happiness and woes of the patients”.
A manager of a private specialist hospital in Shanxi said:
“Patients always ask lots of questions. The doctors in my hospital always answer every
question patiently. Our doctors take time to communicate with patients, never refusing a
single one. Our doctors pay more attention to service attitude because they work in a private
hospital and they don’t want to lose their job.”
Private clinics are more responsive to patients’ needs:
“Doctors of private clinics can go to see a patient at his home. The home-bed is very
important in rural area. Diseases in rural areas are a very mixed bag while the large
departments of public hospital are very specialized.”
“The inpatients in my hospital need not be accompanied and cared for by their relatives so
it’s more convenient for patients and relatives”.
“Private clinics have more flexible and longer opening hours including holidays.
“The duration from registration to intravenous transfusion would take 40 minutes in a public
hospital. In a private clinic, the doctor can do it at once.”
But almost all investors of private healthcare facilities think that the private
health care facilities cannot match the public facilities in comprehensiveness and
technical standards.
A manager of a public hospital in Sichuan said that sometimes, village
practitioners make serious medical errors which land the patients in his hospital.
A manager of a public hospital in Shanxi said:
“Lots of private clinics are run by village practitioners who are actually illegal medical
practitioners. The rural people don’t know this. They don’t know about the Doctors Act. They
pay little attention to whether the practitioner has a license. They know about the illegal
practitioners only when malpractice occurs.
Fake medicines were also raised as an issue:
“Lots of medicines in private clinics are fake, even if the medicine came from the local
Medicine Company.”
Said a manager of a public hospital in Sichuan:
“There are about 120-130 private clinics and private drugstores within two km of a township.
About 70% of them have fake medicines. None of the public facilities have fake medicines.”
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Chapter 3. Result part 6
False advertisements
A common observation made was that private health facilities often publicize
themselves by resorting to exaggeration and self-glorification in their advertisements.
Commented a manager of a public hospital in Sichuan:
“The majority of advertisements by private health facilities concern treatment for Sexually
Transmitted Diseases and drugs that promise good health benefits. The media accepts these
advertisements as long as they are paid. Actually, the Health Bureau should vet these kinds of
advertisement first. These advertisements often mislead the people.”
Supervision by health authorities
Managers of public facilities expressed disappointment that the government
cannot supervise private facilities more strictly:
“The government just regulates the regular army. It can’t control the guerilla”.
A manager of a public hospital in Shanxi pointed out that some private hospitals
rent out their licenses to others, with the result that some operators of clinics are not
medical practitioners.
“There are lots of private clinics practice with addresses different from the address written
down in the license. Lots of private clinics dispense drugs beyond what they are permitted.
Nobody regulates them. The Health Bureau can’t control them effectively.”
Managers of private facilities complained that there is no level playing field:
“We have to comply with every regulation enacted by any government department whereas
the public facilities are not as strictly regulated. The government should just clamp down on
those illegal medical practices and support those of us who are qualified.”
Health officials acknowledge that they are hardly supervising the private
facilities, but blame it on
“shortage of personnel to supervise and monitor. It is very hard for us to govern.”
Strategies for developing private facilities
Private sector managers and investors advocated liberalization of foreign
investments and joint ventures to encourage the establishment of high-end private
hospitals.
Some suggested that in the urban areas, government should break the
monopoly of the public sector by encouraging privatization and re-designation of notfor-profit
into for-profit hospitals. As for villages, townships and counties, they
recommended a three-tier medical system with practitioners of traditional Chinese
medicine as first line, private clinics with licensed and strictly regulated doctors as
second line, and private hospitals as third line providers.
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Chapter 3. Result part 6
A health official in Sichuan said that the existing rule prohibiting the
establishment of private health facilities within 500 meters of the County Hospital
should be lifted. He noted that in remote areas, it is very difficult for private facilities
to develop because of lack of patients. He also suggested that private and public
clinics should co-operate to serve the people.
An investor felt that the private sector could be encouraged to fill specialty
gaps in the public system.
Managers of public hospitals wanted government to be in charge of the overall
planning so that growth of the health care sector as a whole would be coordinated. All
felt that strict regulation was absolutely necessary. Only qualified personnel,
equipment and techniques, should be approved for the private hospitals.
A health official in Sichuan said that while government should encourage
private facilities in specialty disciplines that are in short supply, it should limit the
number of private clinics. The problem, he said, was:
“The good and bad are now intermingled. The private facilities with unqualified practitioners
and fake techniques should be closed down, keeping the qualified and specialist facilities.”
Private health investors wanted greater freedom to expand their scope and
range of services and to recruit more personnel once they have been granted blanket
approval to set up a high-end hospital.
A manager of a public hospital in Guangdong said that private health care
facilities should grow gradually in a planned fashion.
A manager of a public hospital in county in Shanxi ventured that 10 private
clinics per county was about right.
A health official in Shanxi cautioned that too many private clinics would
impact negatively on the County Hospitals. He felt that the total number of healthcare
facilities should be controlled, and public hospitals should be closed down if they
prove redundant because of lots of private clinics. But quality considerations should
also be factored into the decision.
Regional Health Planning
Health officials said that private facilities should be encouraged in those areas
where present public medical resources are scarce.
A health official from Guangdong disclosed that
“The number of private clinics is presently one per 10000 people, accounting for about 1/15
of healthcare services. We encourage existing private clinics and hospitals to invest more
money to improve service quality levels. Our principle is to improve quality by controlling the
number. In our plan, the target market share of private medical practice is about 12% -15%
by 2005, and 20% by 2010, by which time government will bear 80% of the health care
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Chapter 3. Result part 6
burden, including primary healthcare, daily healthcare, health education and prevention
medicine.”
There was some debate on whether private medical facilities should be
included in the “regional health plan”.
Private investors and health care managers argued in favor of inclusion, saying
that private health care facilities should be considered part of the nation’s health care
resources.
An investor of a private specialist hospital said that if there were no
coordination, and a similar public specialist hospital were built next to his, his
specialist hospital may have to close down.
Some health officials were in favor of including the private sector in the
regional plans, but others said that the public sector should plan independently. It
would be up to the private sector to sniff out opportunities and find its own niches.
One manager said that private health facilities should focus on serving the rural areas.
One investor feared, however, that if the private facilities were included in the
regional health plan, then the official approval of private health facilities might be
hampered.
Regulation
Manager of a public hospital in county in Sichuan Province: 90% health
workers are employed in public facilities in county and below healthcare system.
Private facilities would allure good personnel with income, working condition. If they
don’t allure people from public facilities, they will be hardy to exist.
Health officials from Guangdong said that after the enactment of the Act of
Medical Practitioner enacted, they have been culling the number of private
practitioners (30-40 in Shenzhen city alone) because many could not pass the
examinations required for obtaining the licenses.
Almost all of the private health care investors felt that the health bureaus were
biased and unfair towards private health care facilities. An investor from Sichuan
Province: said the requirements for approval of private facilities were too stringent
and the approval process too complicated. The health bureau imposes restrictions on
the number of employees, the range of services rendered, and even the purchase of
equipment like an ECG or Ultrasound requires approval by the health bureau. .
Therefore, the purchasing of equipment is limited.
Private health care investors felt that health bureaus should not practice
discriminatory treatment compared to the way they deal with public health care
facilities.
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Chapter 3. Result part 6
Pricing policy
Investors and managers of private facilities felt that prices in private facilities
should not be regulated. Health officials and managers of public facilities were
divided in opinion. One investor in a specialist clinic in Sichuan said the price of
drugs should be standardized.
Tax policy:
The tax policy varied according to geographical location. For instance, in
Shanxi, every private clinic has to pay about 400 yuan of tax and 100 yuan of
management fees to the Business and Commerce Bureau.
Health official in Shanxi reasoned that they should pay tax because they are
privately owned entities whose aim is to make a profit. Managers of public hospitals
supported this position.
An investor from Shanxi argued that private facilities should pay lower taxes
because they served a societal function and need. After all, no investments came from
the government.
A manager of a private hospital in Guangdong Province said that taxes should
be lowered as too much taxes would stifle the development of private facilities.
A manager of a private specialist hospital in Sichuan said that public hospitals
should pay taxes as a return on the government’s investment.
Reimbursement from social health insurance:
Investors of private special hospital in Guangdong said that private facilities
should be included in the reimbursement list for social health insurance.
Investors and managers of private facilities said that many people were forced
go to pubic doctors because of the reimbursement policy, even though they are
dissatisfied with the service and quality at the public facilities.
A manager of a private specialist hospital in Sichuan said that private facilities
that have qualified doctors and meet standards should be included in the
reimbursement list of social health insurance.
A health official explained that at present, the reason for not reimbursing
private facilities is that many of them are unqualified.
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Chapter 3. Result part 6
Private medical practice for public doctors
Health officials, investors and hospital managers were generally disapproving
of it. The majority were against private medical practice for public doctors. The
reasons cited included:
• Work in public facilities may suffer
• Quality of care in public facilities may be affected.
• Difficulty in supervision on both sides (public and private facilities).
• While doctors working in a public facility cannot open a private clinic
based on the Regulation of Medical Facilities Management, some doctors
may operate from their homes.
However, some managers and officials were in favor of, provided it is strictly
regulated and monitored.
Supervision of the private sector
Health care managers highlighted that there were many problems in the
private sector such as doctors providing services beyond their level of competence,
doctors owning the clinics but subcontracting them to unqualified medical staff
without license, false advertisements going unchecked; and weak supervision by
health authorities.
Government health officials acknowledged that the above problems existed
but lamented that they lacked the personnel to carry out the necessary monitoring and
supervision work. They also “lacked teeth” to punish errant practitioners or owners of
health facilities. Some officials suggested setting up special teams for the task.
Health care managers and officials felt that there were already ample
regulations for dealing with many of the existing problems highlighted. For example,
unqualified doctors could be eliminated by strictly implementing the examinations
system prescribed by the Act of Medical Practitioner and the low standard of private
clinics could be addressed by adhering strictly to the provisions of the Regulation of
Medical Institution Administration. But all agreed that a key problem was how to deal
with non-compliance.
Investors and private sector health care managers complained that they could
not access health-related documents and regulations that concerned them. They
appealed for an “equitable competitive environment”, i.e. they would like to be
treated in the same way as the public sector by being shown government documents,
and for more evenhandedness in the supervision and taxation aspects.
An investor of a private specialist hospital in Shanxi complained:
“There are 23 government bureaus or departments with the right to regulate my hospital -
including the health bureau, drug supervision bureau, drug examination department,
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Chapter 3. Result part 6
preventive medicine station, environmental protection bureau, business and commerce
bureau, tax bureau, police department, broadcast and TV bureau, and so on. There are too
many departments to supervise and monitor us and some of them are conflicting.”
An investor of a private clinic in Shanxi said:
“The management actions of the Business Bureau and the Tax Bureau are disordered and
unharmonized. My clinic pays the Business Bureau more than 1000 yuan and the Tax
Bureau more than 1000 yuan per year, respectively. I pay the Health Bureau more than 600
yuan per year. I still have to pay 160 yuan for the business license, 100 yuan for tax license
and 160 yuan for medical license. It is very hard to depend on the Health Bureau to
supervise illegal medical practice”.
Managers of private facilities wanted their private health facilities to be
supervised and monitored in the same way as the public facilities once they obtain
their approval.
A manager of a private special hospital in Shanxi suggested that the Health
Bureau should enforce the laws and regulations on behalf of, and in cooperation with
the Business and Commerce Bureau, the Police Bureau, and the Drug Supervision
Bureau. For instance, they should have the power to ensure that private health
facilities should have fixed practice addresses and are properly registered. An
interesting point was made by a private investor:
“We pay so much in fees and taxes to so many Bureaus; we should at least be entitled to be
differentiated from the “fake” practitioners in the eyes of the public!”
A health official in Sichuan explained that the health bureaus’ supervision
relied heavily on the provisions of the Act of Medical Practitioner and the Regulation
of Medical Facilities Management and other regulations. The results are fed back to
private practitioners at a meeting two or three times per year. However, he
acknowledged that the supervision was not effective because of lack of manpower.
A health official in Shanxi clarified that practitioners in private clinics paid a
managerial fee of about 600 yuan annually to the health bureau. But he said the
difficulty with managing illegal medical practitioners is that the patients welcomed
them.
Malpractice
Private practitioners complained that they didn’t know what the national
policies on health care were.
The issue of patient compensation for medical errors was also raised. A
manager of a public hospital in Guangdong Province asked:
“If a private facility is closed down for malpractice, who will be punished for the malpractice
and who will compensate the patient
59

Chapter 4. Discussion
Chapter 4
Discussion
In this chapter, we examine what the salient findings mean in relation to the
research questions posed at the beginning of this study, and ask: What policy
implications do they have, for private medical practice in China
a. Salient findings
To recapitulate, the main research questions were:
What is the current situation with respect to private medical practice in
China
It is clear that private medical practice – meaning private hospitals and private
clinics -- has taken root in Guangdong, Shanxi and Sichuan.
Private hospitals are relatively rare, accounting for only 3% of all hospitals.
Varying in size and technical standards, they do not, unlike public hospitals, provide
emergency services, high risk procedures or preventive care. They are usually found
in the bigger cities and cater to those who can afford more personalized services.
They generally charge less than public hospitals for similar services, but those
offering specialty services in niche areas (e.g. stomatology) or newer techniques (e.g.
lasix surgery) may charge more.
Taiyuan city in Shanxi province has the highest concentration of private
hospitals (0.57 per 100,000 population), followed by Shenzhen city in Guangdong
province (0.50 per 100,000 population) and Leshan city in Sichuan province (0.09 per
100,000 population).
Private clinics are much more in abundance, but vary greatly in the quality of
care rendered. Solo practitioners range from the unlicensed and unqualified, through
those qualified in traditional Chinese medicine, to the western medicine trained
specialist, usually a retiree from a public hospital. The proliferation of private clinics
in recent years, in a poorly regulated environment has given rise to concern.
Apparently, unlicensed practitioners, fake medications, and false advertisements
abound.
Taiyuan city in Shanxi province again boasts the highest concentration of
licensed private clinics (4.4 per 10,000 population), followed by Shenzhen city in
Guangdong province (2.6 per 10,000 population) and Leshan city in Sichuan province
(1.8 per 10,000 population). As for the rural areas, Yangqu county in Shanxi province
has the highest (2.1 per 10,000 population), followed by Haifeng county in
Guangdong Province and Weiyuan county in Sichuan (both with 1.3 per 10,000
population).
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Chapter 4. Discussion
Despite their small numbers relative to the public sector, the private sector
surprisingly commands a significant share of the outpatients market. As many as 33%
of respondents in our household survey reported that their last visit to a doctor was to
a private clinic. Significantly more rural residents (53%) visited private clinics than
urban residents (13%) in the 12 months under review. Most were for minor ailments
like the common cold, sore throat, upper respiratory tract infection, gastrointestinal
disorders, and disorders of the reproductive system.
An interesting point to note is that the blending of conventional western
medicine with traditional Chinese medicine, a characteristic of China’s health care
system, seems to be more pronounced in the private sector. A substantial number of
survey respondents (31%) said they trusted Chinese medicine more than Western
medicine, and the majority (74%) said they preferred to see a doctor who practices
both Chinese and Western medicine. This gels with our personal observations when
we visited the private clinics in the provincial cities and counties, that almost all of
them offered (indeed advertised) combined or integrated “east-west “ medical care – a
reflection, perhaps, of supply responding to demand.
What are the main reasons why consumers use private medical services
When asked to rank in order of importance the factors influencing their choice
of providers, “affordability” ranked third in importance (80%) after “good quality of
care of the doctor” (88%) and “doctor’s attitude (respect and concern) towards me”
(84%). The fact that “affordability” trailed behind “respect and concern” may come
as a surprise to some, but this is in fact consistent with patient satisfaction surveys
conducted elsewhere, e.g. in the United States and Singapore.
Since “good quality of care of the doctor” ranked as the most important factor
influencing provider choice, it begs the question: How do private and public doctors
compare in the eyes of patients in terms of clinical quality of care Answer: patients
rated public doctors (69%) more highly than private doctors (23%). In fact, in
response to another question, only 8% agreed with the statement that “doctors in
private practice have better skills/techniques than those in public practice”.
Yet, why do so many patients (33%) choose to visit private clinics
Apparently, patients in search of “value for money” tend to trade off quality against
cost. Although they do not think much of the clinical skills of private doctors, they
nevertheless patronize them because they are cheaper and more responsive to their
needs.
An interesting decision rule that we learned from patients in the focus groups
was: “for small illness, consult a private doctor; for big illness, consult public
doctors”. In fact, many said they would go to the public hospital for diagnosis of
their medical condition and then follow up with a private doctor once they understood
the nature of their illness and the treatment needed.
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Chapter 4. Discussion
Apart from the higher costs associated with public clinics, satisfaction levels
of private clinic visitors were consistently higher than for public clinic visitors. More
private clinic visitors (77%) than public clinic visitors (56%) were satisfied (overall)
with their last encounter with the clinics; more private clinic patients (63%) than
public clinic patients (54%) rated the overall quality of care and services rendered as
“good” or “very good”; more private clinic patients (56%) than public clinic patients
(44%) were willing to recommend their doctor to their relatives and friends.
Specific complaints about public clinics included the bad attitude of clinic
staff, complicated registration procedures, and general inefficiency. In contrast,
patients said that private clinics were more convenient and accessible, had flexible
opening hours, were more affordable, had better attitudes towards patients, and were
more customer-oriented.
What is the affordability of private medical services to consumers,
compared to pubic medical services
There was almost universal agreement that private medical services were more
affordable compared to public medical services.
48% of private clinic patients said they were satisfied with the “affordability”
aspect of their last visit, compared to 26% for public clinic patients.
What is the willingness and ability of consumers to pay for private
medical services
Affordability, however, is relative. Patients’ perception of affordability varied
according to the provinces they came from, household income, and availability of
health insurance.
Thus, even though overall, 70 % of survey respondents said they found health
care costs to be “too high and unaffordable”, fewer people in affluent Guangdong
(47%) than in Shanxi (80%) and Sichuan (82%), felt that way. Furthermore, there
was remarkable consistency within each province between rural and urban dwellers in
their responses (Table 31).
Table 31. Percentage who say health care costs are “too high and unaffordable”,
according to geographical location
Province Guangdong Shanxi Sichuan
City/County
Shenzhen
city
Haifeng
county
Taiyuan
City
Yangqu
county
Leshan
City
Weiyuan
county
% who say health
care costs “too high
and unaffordable”
47.9 42.4 78.4 78.3 78.0 83.8
Interestingly, the doctors in our survey did not feel as strongly as the people
about the affordability issue. Only 28% considered it a serious problem. But they
62

Chapter 4. Discussion
conceded that medical expenses in private clinics were lower and more affordable
than in the public clinics.
One possible explanation for the difference in perception between residents
and doctors is that the patients with whom the doctors came into contact were those
who could afford to see them in the first place. After all, there were 16% of
respondents with “unmet need”, i.e. who did not even enter into the health care
system in the last one year, mainly because they could not afford to do so.
The latter vulnerable group merits further study and attention. But based on
our findings alone, the significant factors independently associated with unmet need
were: province (Shanxi>Sichuan>Guangdong), male gender, urban residence, no
health insurance and low income (see page 22).
Investors, health care managers and officials too, unanimously agreed that the
private sector was more affordable. But officials sounded a note of caution: “Private
clinics may be cheaper, but beware of fake doctors and fake medicines”.
What are the expectations and attitudes of practitioners, consumers and
health officials towards private medical practice
Overall, there was broad consensus that private medical practice plays a
positive, complementary role to public medical services and that increased
competition from the private sector would stimulate higher standards of care and
greater efficiency in the public sector,
Consumers were hopeful that it would lower costs in the public sector and
improve staff attitudes toward patients.
Interestingly, only 20% of public doctors compared to 88% of private doctors
agreed that the “private sector plays a useful role”. But pubic doctors in the focus
groups welcomed the prospect of an additional career option after their retirement
from the public sector.
Doctors from Shanxi and Sichuan favored the establishment of more private
hospitals but not private clinics. This was because they felt there were already too
many private clinics in their provinces, many of which had unqualified practitioners.
When asked if they would like the government to encourage more private
clinics to be set up, consumers (42%) were keener than doctors (38%); rural residents
(54%) were keener than urban residents (29%); private doctors (63%) were keener
than public doctors (18%); and urban doctors (47%) were keener than rural doctors
(27%) on the idea. In other words, support for further development of the private
sector was more likely to come from consumers rather than doctors -- in particular,
rural residents among the consumers, and urban practitioners among the doctors.
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Chapter 4. Discussion
Public sector doctors and public hospital managers felt that private practice
should be encouraged in those areas that the public sector could not reach. They
tended to be more conservative regarding the growth and development of the private
sector and favored “planned competition” in which the government was in overall
control of the situation.
There was even a hint of an adversarial relationship between the public and
private sectors: Public doctors in the focus groups said that they found private
hospitals a threat to the survival and mission of public hospitals. Health officials and
public hospital managers were also concerned that post - WTO, there would be a
brain drain of highly qualified doctors from the public sector to foreign investorowned
private hospitals.
On the other hand, there was a perception among private hospital managers
and investors that local health bureau officials were protective of the interests of the
public hospitals, to the extent that the private sector was discriminated against, even
stifled. Examples cited included the restriction of the private sector to certain
unpopular specialties or to unpopular areas; the denial of access to official documents
issued by the health authorities; the onerous charges and fees imposed (reportedly
more than 40 separate items a year) by the health authorities; the denial of
reimbursement by health insurance; and the exclusion of the private sector from the
provincial regional health plans.
What are the attitudes and opinions of practitioners, consumers and
health officials on part-time private medical practice for doctors in the
public health care system
The majority of stakeholders were against the idea. Only a minority of doctors
(37%) and patients (37%) agreed that public sector doctors should be allowed parttime
practice medical private to supplement their income.
Participants of focus groups and other stakeholders interviewed, including
health officials, investors and hospital managers, were also generally disapproving of
it. Their main concern was that the doctor’s divided attention might compromise the
care of his patients in the hospital. Those who thought it acceptable stressed that it
must be closely monitored and well regulated.
What regulatory mechanisms are in place to permit private medical
practice
We found a long list of documents issued by both the central and provincial
governments on the accreditation and licensing of private practitioners, and the
administration and regulation of clinics and hospitals (see Annexes C and D).
They were fairly detailed and in fact, many of the problems highlighted had in
fact been anticipated by these documents. For example, the problem of unqualified
doctors could be eliminated by strictly implementing the qualifying examinations
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Chapter 4. Discussion
system as prescribed by the Act of Medical Practitioners, and the problem of
substandard private clinics could be rectified by adhering strictly to the provisions of
the Regulation of Medical Institutions Administration. But the more fundamental
problem appears to be how to monitor and deal with their non-compliance.
The general perception of stakeholders was that no one seemed to be
monitoring or enforcing compliance to any effective degree. It could partly be
because oversight of the private medical sector is presently spread over too many
separate and vertically-structured government departments; or perhaps, monitoring
and enforcement were hampered by lack of manpower dedicated to the task.
Investors and private sector health care managers raised an interesting
complaint: they claimed they were denied access to the health-related documents and
regulations which they vaguely knew existed, and which vitally concerned them.
They hoped that the health bureaus would treat them in the same way as the public
sector, and be shown the relevant government documents.
What are the attitudes and opinions of practitioners, consumers and
health officials on the necessary controls for private medical practice in
China
There was broad consensus among all stakeholders that private medical
practice has so far been poorly regulated. Almost all felt that the regulatory
mechanisms needed strengthening.
Examples cited to illustrate the poor regulatory environment included the
“blind proliferation” of private clinics – with many failing to meet basic standards and
apparently operating without licenses; false medical advertisements; and overprescription
of drugs for profit, a practice apparently rampant in both the public and
private sectors.
There was also concern that some private (licensed) doctors were providing
services beyond their level of competence. It was also alleged that nominal owners of
the clinics were subcontracting the clinics to unqualified and unlicensed practitioners.
There was cynicism among health care managers that the existing rules and
regulations were good “only for hanging on the wall”, and no one seemed bothered if
unqualified practitioners are doing good or harm to patients. There was even a
suggestion of official complicity as licenses could allegedly be bought.
Government health officials acknowledged they were aware of the above
problems but lamented that they lacked the personnel to carry out the necessary
monitoring and supervision work. They also “lacked teeth” to punish errant
practitioners or owners of health facilities. Some officials suggested setting up special
teams for the task.
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Chapter 4. Discussion
Health care managers, however, felt that officials seemed interested in using
their regulatory powers instead to oppress bona fide health facilities by imposing all
kinds of fees and taxes. Investors appealed for uniform application of rules for both
private and public sector facilities.
Some doctors suggested establishing medical associations for self-disciplining
and for weeding out unqualified and incompetent practitioners.
b. Policy implications
Since the objective of this study was to merely “gather information that will
facilitate evidence-based policy making”, our task is complete with the information
having been gathered and presented. Policy formulation rightly belongs to officials at
the Ministry of Health (at any rate, we will need to understand a great deal more in
detail, before proffering advice on what concrete steps to take next). Nevertheless, we
would like to highlight certain broad themes that have emerged from our study that
have policy implications, for the consideration of policy makers.
Future of private medical practice in China: need for regulatory
framework
Quite clearly for China, market-oriented private medical practice presents both
opportunities and dangers. For example, it may relieve the government of its burden
as the sole provider of health care services but at the same time, subject the health
care system to the pitfalls associated with market failure. It may even have a negative
impact on the existing public sector (e.g. causing a brain drain of top specialists).
Given China’s commitment to market reforms however, and the fact that
private practice is already well and truly entrenched and not exactly unpopular with
the people as documented in this report, it would be impossible, and unwise, to turn
back the clock.
Going forward therefore, the first point to note is, whether or not the benefits
of private medical practice can be realized, is inextricably linked to whether or not
appropriate and effective controls are in place. There is therefore an urgent need to
review and strengthen the existing mechanisms for protecting patient safety. Beyond
the mere promulgation of rule and regulations, there is a need to put in place a
system for effective surveillance, clinical audit, quality assurance and legislative
enforcement.
At the same time, while there is clearly a need to strengthen the hand of the
regulatory agencies in their ability to monitor, inspect and take enforcement measures,
there must also be checks to ensure that regulatory power is not abused.
Moreover, it must be recognized that there are limits to using the regulatory
approach alone. Governmental regulation should be supplemented by professional
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Chapter 4. Discussion
self-regulation, a concept that appears to be alien, and practically non-existent, in
China. International experience has shown the benefits of having professional
medical societies or associations play a useful role in continuing medical education, in
providing avenues for redress of complaints against medical practitioners, and even in
undertaking a role in the accreditation of practitioners, medical schools and health
care facilities.
It should also be borne in mind that public accountability does not always
have to mean accountability to government agencies. If there were greater
transparency, e.g. in the measurement and monitoring quality indicators, residential
committees and consumer groups too, can play effective roles as public watchdogs on
cost, quality, and patient safety issues.
Health care costs
The high cost of medical care in the public sector appears to be at the root
cause of some peculiar characteristics of the private sector in China when compared
to the rest of the world. For instance, the fact that private medical practice seems to be
more entrenched, and more popular, in the rural counties and villages than in the
urban cities, contrasts with the situation outside of China, that private medical practice
is usually more lucrative and viable in the cities. Related to this, of course, is the other
peculiarity that publicly provided outpatient care is actually more expensive than
private outpatient care. This contrasts with the situation in developed countries, where
private medical practice often conjures images of “boutique medicine” --
personalized, up-market, and hence more expensive.
The reality is that China’s popular private practitioners are perceived to
provide low quality care but people gravitate to them more by default than by choice.
At the same time, perverse incentives are at work in the public sector (e.g. the
pressures to cost-recover, as exemplified by the tendency to over-prescribe
medications and investigative procedures for profit), resulting in patients feeling
“squeezed” – between poor quality private care on the one hand and out-of-reach,
better quality public care on the other.
But the matter requiring the most immediate attention concerns the finding in
our study that cost is a real barrier to access for a substantial number with unmet
health care need. There is an urgent need to increase access to basic health care for
the poor. Perhaps new mechanisms need to be introduced that provide targeted
subsidies to the poor, so that no one will be denied needed health care because of
inability to pay.
Quality of care
The concerns expressed by all the stakeholders regarding the poor clinical
quality of care in the private sector -- perceived to be inferior to that of the public
sector -- point to the need to upgrade clinical standards of care, especially in the
private sector. Similarly, the widespread dissatisfaction with the poor quality of
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Chapter 4. Discussion
services point to the need to revitalize public medical services, to make them more
customer-oriented and patient-focused.
Furthermore, “quality of care” should not be narrowly limited to the technical
aspects of care. Patient satisfaction is also an important, and often neglected,
dimension of quality. Patients want from their health care providers, in order of
importance, (a) good quality medical care, (b) treatment with respect, care and
concern, and (c) reasonable charges. This strikingly similar finding to patient
feedback surveys in other countries like the United States and Singapore goes to show
that although local circumstances and experiences may vary, some aspects are
universal after all. Health care providers will do well to pay greater attention to
giving patients what they say is important to them.
The initiation of a national quality of care movement and the promotion of a
quality of care culture that percolates to all levels – central, provincial, local, and
throughout the entire health care infrastructure, both public and private – would be
steps in the right direction.
And of course, very little will change if incentives are not aligned with
organizational goals. One suggestion is to look at successful models elsewhere of
restructuring or corporatization of public sector hospitals, resulting in greater
efficiency and responsiveness to patients’ needs. And perhaps, there are even useful
management lessons that China’s public sector can already learn from its own private
sector
Public-private partnership
The relationship between the public and private sectors need not be
adversarial. The public sector should treat the private sector as partners in health
care, with whom to share information and cooperate to improve the delivery and
quality of care.
Regulators should also avoid being seen to have double standards. Failure of
government agencies to discipline public health care providers using the same set of
criteria, for instance, would invite cynicism and undermine their own effectiveness.
Allegations of abuse of regulatory powers must be investigated and dealt with.
The proposal to include the private sector in the regional health planning
process merits consideration. The almost universal belief on the part of health care
officials and public sector health care managers that the private sector’s proper role is
to serve those areas not reached by the public sector, while well-meaning, might itself
lead to allocative inefficiency. Given that the private sector’s legitimate motive is
profit, and the public sector’s raison detre is the public good, why should it not be the
other way round – that the public sector should focus on reaching the underserved It
might even be necessary to scale down or withdraw public sector health care services
from areas that are already well-served by the private sector, so that the freed-up
resources can be redeployed to reach the rural poor and underserved.
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Chapter 4. Discussion
Doctors’ careers and professional development
Experience in other developing countries has shown that when doctors are not
adequately compensated, they will resort to other means of compensation such as
accepting gifts for favors or over-prescription and over-treatment for profit, both of
which were mentioned as existing problems in the focus groups for patients as well as
doctors.
The challenge of retaining good but unhappy doctors will be even greater in an
increasingly competitive and liberalized environment consequent to China’s entry into
WTO.
The extremely low level of satisfaction of doctors in the public sector with
their jobs, pay, and opportunities for professional growth and development, need to
be addressed. Measures should not be restricted to monetary rewards; avenues for
interaction with professional peers and for continuing medical education are equally
important.
Importance of tailoring policies to local context
Finally, the fact that we found significant variation among the three provinces
and between rural and urban populations in their health seeking behavior, opinion,
and receptivity to market-based private medical practice implies that a “one size fits
all” approach would be inappropriate. The pace of development of private medical
practice should take into consideration the prevailing local conditions and their
readiness for change.
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Chapter 5. Conclusion and recommendations
Chapter 5
Conclusions and recommendations
Limitations of study
The information obtained from our study can only serve to illuminate and
inform; they cannot provide answers to the many questions it raises, such as what
policy framework would be appropriate at the national, provincial and local levels to
guide the development and growth of private medical practice, and which regulatory
mechanisms need to be strengthened and which ones need to be replaced.
Nor are the findings generalizable to every province in China, or even every
city or county within the same province that was studied. If anything, our analysis of
the results showed wide geographical variation and diversity in the opinions and
attitudes of the population, as well as their socioeconomic conditions, health seeking
behaviors and receptivity to change. Hence, specific policy formulation must
necessarily take into account specific details not captured by the present study.
Indeed, this project has been an ambitious undertaking from the very start,
from the point of view of its scale (Guangdong province alone is more populous than
the United Kingdom) -- hence, the broad-brush approach that we have taken, using a
combination of qualitative and quantitative methods to gather as much information as
possible, in order to arrive at a reasonably clear, “first cut” picture of the difficult
subject at hand. This, we believe, we have achieved. Our study has yielded new,
empirical findings about private medical practice in China, which would strengthen
the evidence base for policy making.
Key findings
In essence, our findings:
• confirm that private medical practice -- ranging from the unqualified and
unlicensed practitioner in the small rural village to the modern investorowned,
for profit, well equipped multi-specialty hospital -- has already
taken root and is playing a significant role in China’s health care delivery
system, or at least in the three provinces studied.
• reveal a wealth of information about the attitudes and opinions of the
major stakeholders – the public, doctors, government officials, health care
managers and private investors -- toward the role of private medical
practice vis-à-vis public medical providers, and
• point to the urgent need to address issues of effective regulation, equitable
access, affordable costs, quality of care, and medical professional
development.
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Chapter 5. Conclusion and recommendations
Recommendations
With the caveat that specific policy recommendations for each province or
situation will require further detailed studies as appropriate, and will take into account
local conditions and context, we would like to conclude with some recommendations
for action as follows:
General recommendations:
Given that three interrelated issues -- cost, quality of care, and dissatisfaction
with current service levels -- stand out as recurring themes in the feedback obtained,
MOH should give priority to developing clear strategies that will:
• ensure affordability of health care in both pubic and private health care
facilities, especially for the poor;
• improve quality of health care in both public and private health care
facilities; and
• raise the standard of health care management in public and private health
care facilities.
Specific recommendations:
With respect to the future growth and development of private medical practice
in China, a key policy challenge for MOH will be to determine the framework for
future growth and development of the private health care sector, including the
appropriate public-private mix that will maximize efficiency gains while maintaining
the basic premise of equitable health care for all.
The immediate tasks ahead are to:
• review the existing regulatory system with respect to its legislative
authority and ability to monitor and protect patient safety and ensure
quality of health services. There should be no difference in accreditation
standards for both public and private medical facilities. The focus should
not only be on licensing and accreditation, but also, legislative
enforcement, surveillance, clinical audit and quality assurance.
• define the framework within which the private medical sector should be
allowed to develop, and give it direction so that its potential as an efficient
and innovative provider of affordable and good quality health care that
complements public providers can be realized.
• determine (e.g. by using scenario planning techniques) the optimal privatepublic
mix of health care services that would be appropriate for each
province, city or county, and where necessary, promote the private sector’s
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Chapter 5. Conclusion and recommendations
share of the market while redeploying freed-up public resources to
underserved areas.
• initiate a national quality of care movement that percolates to all levels –
central, provincial, local, and throughout the entire health care
infrastructure. Public sector health facilities, in particular, need to be
revitalized. They need to be more customer-oriented and patient-focused.
• measure appropriate quality indicators that reflect quality of care, and
which will enable national and international comparisons and
benchmarking, thereby enabling the setting of objective targets for quality
improvements. There should also be appropriate mechanisms for
monitoring medical errors and managing patient safety issues.
• encourage the development of self-regulating and self-disciplining medical
associations at provincial and national levels to uphold the ethos of
medical practice, look into medical-ethical and medical-legal issues, and
serve as important forums for professional interaction and continuing
medical education.
• encourage avenues for private-public sector cooperation.
• study in greater detail the health care needs of the poor and indigent, who
are likely to have unmet health care needs, and consider introducing
mechanisms that deliver targeted subsidies for the poor and indigent.
For each of the above recommendations, it may be necessary to conduct
further in-depth follow-up studies and policy reviews. It would also be wise to tap
international experience and expertise so as to learn from successful and functioning
models from around the world – but bearing in mind, of course, that applicable ideas
and policies must be adapted to the local conditions.
72