Lessons from the East
At first glance, China might seem unlikely to offer useful health care lessons to many other countries. Its health system exists within a unique geopolitical context: a country of more than 1.3 billion people, occupying a huge, diverse landmass, living under authoritarian single-party rule, and making an extraordinarily rapid transition from a Third-World to a First-World economy.
But first impressions can be misleading. Since its birth in 1949, the People's Republic of China has undertaken a series of remarkable health system experiments that are instructive at many levels. One of the most interesting lessons from the Chinese experience concerns the value of an institution that many countries take for granted: medical professionalism.
Because the changes in China's health care system have been so rapid and profound, it is helpful to briefly review its recent history.1 What might be seen as the first of four phases began when the Chinese Communist Party took power in 1949. The new government created a health system similar to those of other communist states such as the Soviet Union and its Eastern European allies. The government owned and operated all health care facilities and employed the health care workforce. No health insurance was necessary, because services were nearly free. A distinctive accomplishment of this phase was the system's successful use of community health workers, so-called barefoot doctors, to provide basic public and personal health services at the village level. Between 1952 and 1982, China's infant mortality rate fell from 200 to 34 per 1000 live births, and age-old scourges such as schistosomiasis were largely eliminated.2
In 1984, a second phase began: China turned its health system on its head, almost as an afterthought to dramatic free-market reforms in the rest of its economy. Led by Communist Party leader Deng Xiaoping, China converted to a market economy and reduced the role of government in all economic and social sectors, including health care. Government funding of hospitals dropped dramatically, and many health care professionals, including barefoot doctors, lost their public subsidy. The government continued to own hospitals but exerted little control over the behavior of health care organizations, which acted like for-profit entities in a mostly unregulated market. Many health care workers became private entrepreneurs. Physicians working for hospitals received hefty bonuses for increasing hospital profits.
As they responded to these new economic imperatives, Chinese physicians had little history or tradition of professionalism or independent professional societies to draw on. China had transitioned from a society organized according to Confucian principles (which did not envision the existence of a modern, independent profession such as medicine) to a communist country (in which clinicians were state employees owing their primary allegiance to the Communist Party) to a quasi-market environment. At no point along this journey did physicians have the opportunity or support to develop the norms and standards of medical professionalism or the independent civic organizations that could promote and enforce them. Indeed, the Chinese language has no word for “professionalism” in the Western sense.
To make China's experiment with free-market health care even more dramatic, the Chinese reforms left the vast majority of the population uninsured, since the government did not provide coverage and no private insurance industry existed. As of 1999, a total of 49% of urban Chinese had health insurance, mostly through government and state enterprises, but only 7% of the 900 million rural Chinese had any coverage.2 Thus, a population largely unprotected against the cost of illness confronted a health care delivery system intent on economic survival and a health-professional workforce that had never had the opportunity to develop as independent professionals. Indeed, prevailing new economic rules and incentives strongly encouraged physicians to operate like entrepreneurs in a capitalist economy.
The government kept its hand in one major aspect of health care: pricing. Presumably to ensure access to basic care, it limited the prices charged for certain services, such as physicians' and nurses' time. However, it allowed much more generous prices for drugs and technical services, such as advanced imaging. The predictable result: hospitals and health care professionals greatly increased their use of drugs and high-end technical services, driving up costs of care, compromising quality, and reducing access for an uninsured citizenry.
By the late 1990s, this market-reform experiment had resulted in public anger and distrust toward health care institutions and professionals, and even in widespread physical attacks on physicians. Discontent with lack of access to health care fueled public protests, especially in less affluent rural areas, that threatened social stability and the political control of the Communist Party.
Recent events:
In 2003, a third phase began, when the Chinese government took a first step toward mitigating popular discontent with health care by introducing a modest health insurance scheme covering some hospital expenses for rural residents. The focus on hospital care reflected the fact that hospital services were expensive and therefore drove many patients into poverty.
But this hospital orientation also reflected limitations in the leadership's understanding of the critical role that competent primary care plays in managing health and disease and controlling the costs of care. Chinese authorities were also preoccupied with relieving the financial burden created by much more expensive hospital services. Not surprisingly, the 2003 reforms proved insufficient to ameliorate China's deep-seated health care problems.
By 2008, China's leaders had concluded that major reforms in both insurance and the delivery system were necessary to shore up the system and ensure social stability. In a fourth and ongoing phase of evolution, they officially abandoned the experiment with a health care system based predominantly on market principles and committed to providing affordable basic health care for all Chinese people by 2020. By 2012, a government-subsidized insurance system provided 95% of the population with modest but comprehensive health
coverage
Selected Characteristics of the Health Care System and Health Outcomes in China. and case histories; to compare this country with others, see the interactive graphic).3 China also launched an effort to create a primary care system, including an extensive nationwide network of clinics.3
coverage
Selected Characteristics of the Health Care System and Health Outcomes in China. and case histories; to compare this country with others, see the interactive graphic).3 China also launched an effort to create a primary care system, including an extensive nationwide network of clinics.3
Though China's extensive 2008 reforms are still in process, a number of problems, mostly concerning tertiary hospital care, continue to challenge its leadership. First, many of the country's publicly owned but profit-driven tertiary hospitals successfully resisted the latest reform efforts — a reality that probably reflects the hospitals' power within China's political system. As a result, frustrated authorities sought to use market forces once again to bring the hospital sector into line. In 2012, the leadership announced that they would invite private investors to own up to 20% of China's hospitals by 2015, double the preexisting rate.4
Second, major inequities continue between the health care available in poor rural areas and that in more affluent cities.5 Third, China continues to struggle with creating a high-quality, trusted, professionalized physician workforce. One legacy of China's market experiment is a widespread perception that physicians put their economic welfare ahead of patients' interests.
Though China's health care system is still rapidly evolving, several potentially useful lessons emerge from its recent history. The first is that in low-income countries, and perhaps high-income ones as well, community health workers such as China's barefoot doctors can significantly improve the health status of local populations.
Second, relying largely on markets to fund and distribute health services creates risks that need careful consideration. Though government price setting created market distortions, these do not fully explain the problems with quality, access, and cost that China experienced in the second phase of its recent history. Health care is subject to serious market failures. Asymmetries in information between patients and health care providers make it difficult for patients to make sound choices in free health care markets, and patients' lesser knowledge may be exploited by clinicians. Patients' resulting vulnerability, resentment, and distrust can be socially destabilizing — and may intensify when patients are heavily exposed to the costs of care, as they were until recently in China.
Third, physician professionalism may be underappreciated as a foundation for effective modern health care systems. The inculcation of professional norms during and after training and the existence of professional institutions that reinforce these norms certainly do not guarantee that professionals will act only in the interest of their patients and the public. But there seems little question that the lack of a widely shared tradition of professionalism has complicated China's efforts to create a health care workforce that its leaders and the public trust to do the right thing.
Is any of this relevant given the current state of health reform in t he United States.?....Probably not since east-west cultural differences formed the basic foundations of each system.
