By David LagueInternational Herald Tribune
SATURDAY, AUGUST 20, 2005
BEIJING China's authoritarian government is coming under an unusually strong and public attack for the collapse of the country's universal health care system and the rise of profit-oriented state-owned hospitals.
Top government advisers, scholars and the state-controlled media are openly criticizing the ruling Communist Party for failing to avert a growing crisis in public health care. These critics allege that paying patients are treated as cash cows while the poor are denied access to proper medical care.
The public's access to health care in China has been steadily declining for more than two decades. But the system's chronic problems are now emerging as a political issue. As a consequence, Beijing is under mounting pressure, and at senior levels, to re-examine its role in the system.
Critics blame the government for abandoning the public health system to market forces since economic reforms were begun in 1978, leading to what they say are exorbitant charges for medical services, wasteful overservicing and widespread overprescription of drugs.
A hard-hitting report issued earlier this month by the Development Research Center, one of the government's top advisory bodies, concluded that the switch to a user-pays health system has been a failure.
It noted "to our shame" that the World Health Organization ranked the Chinese health system as one of the most unfair in the world. "Most of the medical needs of society cannot be met because of economic reasons," the report said. "Poor people cannot even enjoy the most basic health care."
The government ordinarily discourages open criticism of its policies. In this respect, political analysts and health care experts regard publication of the report from the body that advises China's cabinet, the State Council, as an unusual and surprising step.
It was not immediately clear why Beijing chose to publish the report. But experts in the field suggested that it may indicate a recognition among government officials that the crisis has become so acute as to require an urgent change in policy.
At the same time, there has been some speculation here that the crisis has also become a divisive issue at senior levels of the government. While no officials defend the system as it now functions, the political issue is who should take responsibility for it.
Experts said the report, co-sponsored by the World Health Organization, came at a time when widespread public frustration over the cost of medical care had opened a spirited debate about health policy among senior Chinese leaders.
The official media have prominently reported cases in which even government officials have been financially ruined because of serious illness in their families.
"It's a government failure and a market failure," said Li Ling, an economics professor at Beijing University's China Center for Economic Research. "It is not right. The economy is growing, people have more income, but hospital costs are rising much faster."
Li said one measure of medical overservicing revealed in her research was that an average of 50 percent of babies born in Chinese hospitals were delivered by Caesarean section. In some hospitals, that figure was as high as 70 percent.
The main reason for this was that hospitals could only charge a relatively low fee set by the government for live births, but Caesarean sections could be billed at a much higher rate, as surgical procedures. And these procedures allowed hospitals and doctors to manage their time more efficiently than natural births.
"This is a case of the supplier inducing the demand," Li said. "If a doctor says, 'I think it is better to have it,' nobody has the courage to say no."
Before 1978, only 10 percent of births were by Caesarean section.
Critics note that the government share of national health spending had plummeted from close to 100 percent during the planned economy period to about 16 percent today as the government steadily withdrew from providing health services.
By comparison, public spending accounts for about 44 percent of health outlays in the United States and an average of more than 70 percent in other advanced industrial countries.
In a sign that the authorities fear a public backlash, the state-controlled media has reported in recent weeks that China's top leaders, including Prime Minister Wen Jiabao, were working on plans to expand public health assistance, particularly for rural areas.
In an Aug. 5 report in the official China Daily, Health Minister Gao Qiang joined the attack on allegedly greedy hospitals and said the government would introduce measures to improving access to affordable treatment.
"Patients' medical bills have been used to cover almost everything - medical costs, wages and subsidies for medical personnel, both doctors and nurses, new medical apparatus and hospital facilities," Gao was quoted as saying.
The World Health Organization asserts that the solution to the current crisis is for the state to reassume a leading role in the system. "The government needs to rethink and reinvest," said Henk Bekedam, the organization's representative in China. "At this moment, the only people who can get health services are people who can pay."
Health experts agree that one of the major achievements of China's health system before 1978 was the provision of basic medical care for all urban and rural Chinese.
These services, along with an emphasis on preventive medicine and national campaigns to eradicate endemic disease, contributed to an increase in average Chinese life expectancy from 35 years in 1949 to 68 years by 1978.
Despite a dramatic increase in prosperity and living standards in China since 1978, average life expectancy had increased by only 3.5 years, about half the gains in longevity in Japan, Singapore, Hong Kong and Korea over the same period.
"The rate is very low compared with economic growth," Li said. "There are many reasons for this, but failure of the health care system is one of them."
One other serious consequence of stress on the health system has been the return of deadly diseases including tuberculosis and schistosomiasis that had largely been eradicated before 1978.
Many Chinese can still recite by heart a poem the late Communist Party leader Mao Zedong wrote in the 1950s to mark the successful elimination of schistosomiasis, a parasitic disease carried by water snails.
The Development Research Center's report states, and most experts agree, that the quality and sophistication of medical treatment available in Chinese hospitals has increased dramatically in recent decades. However, deep cuts in government health outlays have forced hospitals and clinics to raise the bulk of their income from medical services and the sale of drugs.
Drug sales accounted for up to half the operating revenue of some hospitals.
"The final result is that hospitals and doctors choose and use medicines in terms of maximizing their own profit," the report said.
However, in the absence of widespread medical insurance, many Chinese, particularly the 800 million living in rural areas, cannot afford treatment when they are ill.
Critics cite China's official 2003 national health survey, which found that about 64 percent of people in big cities who should have been treated by a doctor as inpatients chose not to do so because of the cost. In rural areas, that figure was more than 73 percent.
In its report, the Development Research Center called on the central government to bolster spending and initiate a radical restructuring of the health system in a bid to restore fairness and quality service.