China’s 3-tier hospital system: Gaps and challenges

In China, hospitals are classified as primary, secondary or tertiary based on their level of care, amongst other criteria. Dr Li Heping, President, Shanxi Hospital Association, shares his thoughts on areas that can be improved in the current system

An ideal healthcare system will see seamless integration between institutions across the spectrum of medical care, from basic primary care to complex, high end medical services.

In China, hospitals are grouped in a 3-tier system, with primary hospitals providing general healthcare and preventive care services to the community. Secondary hospitals provide comprehensive health services for a region, taking in referrals from primary hospitals and also taking on the role of teaching and research. Lastly, tertiary hospitals, typically located in urban cities, are responsible for specialist care and serve as medical hubs for multiple regions.

Gaps in the 3-tier hospital grouping system

While the hierarchical system has worked well as the basis for state medical insurance distribution (medical bills are subject to different reimbursement ceilings based on the hospital tier), there are several areas of improvement identified by Dr Li Heping, President of Shanxi Hospital Association in China.

Dr Li Heping
Dr Li Heping

For one, the categorising of public medical insurance payouts based on hospital tier may not be enough. Dr Li raised that the system is administered under a ‘one-size-fits-all’ approach across the nation. However, given that healthcare standards and development across the various states or provinces differ widely, local customisation may be needed. “The system currently does not adapt to local conditions. Policies relating to healthcare payments have not been formulated accordingly to local level of economic development, standard of medical care and local citizens’ understanding of medical care,” he noted.

Secondly, Dr Li pointed out that there is a lack of premium high-end medical services. There is a significant population of high-income, wealthy Chinese who are able and willing to pay for top-notch healthcare. While the country’s healthcare policies do need to cover the basics and the masses, China also needs to be able to provide the highest level of quality medical services, so the rich do not turn to Europe, US or Japan instead. In addition, Dr Li noted that this would also “boost the hospitals’ financials, which would improve medical staff benefits and remuneration, thus attracting more high-end medical talent.”

The flow of patients between secondary and tertiary hospitals is also an issue to be addressed, Dr Li said. “At the moment, there is a single flow of patients from secondary hospitals to tertiary hospitals for consultations and hospitalisation; the referral process of patients from tertiary to secondary hospitals is not smooth,” he said.

Current and future China healthcare trends

In view of this, Dr Li believes that there will be more focus on public hospital reform and medical insurance policies in the future. Also, although China has kept the COVID-19 outbreak under control for the past year or so, the pandemic will continue to be top of mind for Chinese hospitals.

Dr Li explained that as long as the global COVID-19 pandemic continues, Chinese hospitals will have to carry on operating under the new normal. “Sporadic cases or small outbreaks cannot be foreseen and can break out anytime; hence strict control and management has to be enforced,” said Dr Li. “The control measures also have to be set according to facts and science to ensure effective and sustainable control.”

He added that hospitals are conducting emergency planning exercises, with the aim of ensuring any cases are detected, reported and managed as early as possible, to keep the pandemic controlled to the smallest degree.

The pandemic has changed care-seeking behaviours amongst the Chinese public, with Dr Li observing that hospitals are now placing more emphasis on virtual and remote care, and exploring new healthcare delivery models. He also observed a larger trend in terms of the type of diseases that patients are now seeking care for: With the rise in public awareness on hygiene and sanitisation, there has been a huge drop in patients with respiratory, digestive and skin diseases, while cases of myopia in children, endocrine disorders and anxiety have swung up instead. The shift in patient diagnoses, which may be a long-term trend, could inform hospitals’ strategies in resources and operations moving forward.

Hear from Dr Li and other healthcare leaders at HMA China

At the upcoming HMA China online exchange, Dr Li will be speaking on how hospitals can establish a successful hierarchical diagnosis and treatment, as well as a two-way referral model, as part of the Quality & Safety Excellence track.

On 6-7 August 2021, join Dr Li and top hospital executives from China and around the world to pick up ideas and best practices in hospital management.

Don’t miss the chance to hear from Chinese and international healthcare leaders at HMA China – click here now to register.