Healthcare in the People's Republic of China is primarily provided by state-owned hospitals, with medical insurance administered primarily by local governments. As of 2020, about 95% of the population has at least basic health insurance coverage.
Medical insurances are subdivided into employee and resident insurance. The former covers the urban employed population, and the latter covers the urban non-employed population and the rural population. A total of 25% of the people covered by the basic medical insurance participated in the employee medical insurance, a total of 344 million people; 75% participated in the residents' medical insurance, a total of 1.017 billion people. Medical assistance has subsidized 78 million poor people to participate in basic medical insurance, and the coverage of poor people has stabilized at over 99.9%.
Despite this, public health insurance generally only covers about half of medical costs, with the proportion lower for serious or chronic illnesses. Under the "Healthy China 2020" initiative, China undertook an effort to cut healthcare costs, requiring insurance to cover 70% of costs by the end of 2018. In addition, there are policies such as critical illness insurance and medical assistance. China's commercial health insurance is also proliferating. In 2020, the country's commercial health insurance premium income amounted to 817.3 billion yuan, with an average annual growth rate of 20%. China's coverage of maternity insurance has continued to expand, by the end of 2020, 235.673 million people were insured under maternity insurance.
The country maintains two parallel medical systems, one for modern or Western medicine, and one for Traditional Chinese medicine (TCM). Some Chinese consider TCM backward and ineffective, others consider it inexpensive, effective, and culturally appropriate. China has also become a major market for health-related multinational companies. Companies such as AstraZeneca, GlaxoSmithKline, Eli Lilly, and Merck entered the Chinese market and have experienced explosive growth. China has also become a growing hub for healthcare research and development. According to Sam Radwan of ENHANCE International, China's projected healthcare spending in 2050 may exceed Germany's entire 2020 gross domestic product.
The special administrative regions of Hong Kong and Macau maintain their own separate universal healthcare systems.
History Traditional and folk medicine served as the basis for health care in China. Western-inspired evidence-based medicine made its way to China beginning in the nineteenth century. During the Republic of China era, western-style medicine was mostly not present in the Chinese countryside, although there was some western-style medicine available via missionary-run institutions.
Free medical treatment was practiced in areas controlled by the Chinese Communist Party (CCP) before 1949. The CCP-controlled areas lacked access to Western-style medical resources. To improve health care, the CCP promoted the integration of traditional Chinese medicine with Western medical science. In the Yan'an Soviet, mass campaigns sought to "scientize Chinese medicine" and "make Western medicine Chinese." As part of the mobilization effort, the CCP had state doctors lead the "scientizing" process and gave high political status and public honors to some local practitioners of traditional Chinese medicine.
Mao-era PRC After Mao Zedong's 1949 proclamation of the People's Republic of China, national "patriotic health campaigns" and local governments successfully introduced basic sanitary measures and preventative hygiene education. Health care was provided through the place of work, such as the government bureaucratic unit, the enterprise, factory, school, or, in the countryside, the cooperative or commune. Larger danwei might have their own in-patient clinic on premises.
Western-style medicine first made significant inroads in rural China via the PRC efforts to increase immunization by vaccinating people against smallpox, tuberculosis, and typhoid fever.
The government nationalized all missionary-owned and other private hospitals, turning them into state-owned hospitals.
In February 1951, the industrial and mining departments began to try out labor insurance regulations and solve workers' medical problems. In the same year, free medical treatment was also tried in northern Shaanxi and some ethnic minority areas. On June 27, 1952, the Instructions of the Administration Council on the Practice of Free Medical Treatment and Prevention for State Functionaries of People's Governments at all levels, parties, organizations and affiliated Institutions were issued. After that, the CCP government gradually communized the medical and health system and modernized it in imitation of the Soviet Union. During the period of planned economy, a tertiary hospital structure was established: a tertiary medical service and epidemic prevention system consisting of municipal and district hospitals and outpatients from sub-districts, factories, and mines. A three-level medical prevention and health care network is established in rural areas, with county hospitals as the leader, township (town) health centers as the hub, and village clinics as the basis.
During the Great Leap Forward, the PRC encouraged increased focus on local health care. It established hospitals at the commune level, and were financed by a collective welfare fund paid for via work points by the brigades. Medical treatment at these hospitals was free to the individual although medicine still had to be paid for. This increased health care access although it was still beyond the means of many rural people. Dissatisfaction with a health care model that provided more support to urban than rural people increased interest in traditional Chinese medicine, and this interest was also increased by pride in China's intellectual and cultural heritage. In 1958, Mao further encouraged application of traditional Chinese medicine by describing it as a "treasure house" of remedies that must be explored.
The famine greatly disrupted the decentralized mode of health care.
Before the Cultural Revolution, the Ministry of Health focused on the delivery of health care in urban hospitals. Mao criticized Minister of Health Qian Xinzhong for promoting this health care model, arguing that an urban hospital-focused health care model failed to treat peasants and focused on cure rather than preventative medicine. Mao also described the Ministry itself as the Ministry "of urban overlords." Contentions within the CCP on the health care disparity between urban and rural areas became a significant focus of the intra-party "struggle between two lines in the mid-1960s.
Cultural Revolution The Cultural Revolution brought a greater focus on rural health care. In his June 26 Directive, Mao prioritized healthcare and medicine for rural people throughout the country. As a result, clinics and hospitals sent their staff on medical tours of rural areas and rural cooperative healthcare expanded. Barefoot doctors brought healthcare to rural areas. They promoted basic hygiene, preventive healthcare, and family planning and treated common illnesses. Immunizations were provided free of charge. Public healthcare was highly effective in curbing infectious diseases in rural China.
Beginning in 1968, a medical cooperative system was established in rural China. In this system, village unions established medical cooperative stations which were financed by village administrations and villagers themselves. These were staffed by barefoot doctors. For serious illnesses, rural people traveled to hospitals owned by local governments. Rural patients paid expenses at state-owned hospitals themselves.
Deng's economic reform
However, beginning with reform and opening up in 1978, health standards in China began to diverge significantly between urban and rural areas and coastal and interior provinces. The barefoot doctor system was put in free fall in 1981, as the "commune" system was shut down. By 1984, only 4.8% of villages had cooperative healthcare coverage, a sharp drop from the 90% coverage of the mid-1970s. The barefoot doctor model officially ended during the Chinese Medical Reformation of 1985, when the term 'barefoot doctor' was removed from the healthcare system and replaced with the term and concept of 'village doctors'. Though most village doctors are former barefoot doctors, they started charging for their services as private entities.
Urban residents also faced healthcare privatization as they were laid off from state-owned enterprises and lost much of their social security and health benefits. As a result, the majority of urban residents paid almost all health costs out-of-pocket beginning in the 1990s, and most rural residents simply could not afford to pay for healthcare in urban hospitals.
In 1989, the Chinese government decided to try and reverse the fall of rural healthcare coverage, but they were not very successful: coverage was only up to 10% by 1993. In 1994, the government decided to fund a revival of the co-operative system, though they would not be successful until the 2005 NRCMCS project.
Despite the consequences of privatization, the economic reforms did bring in money and new technology for building new hospital infrastructure. Modern hospital infrastructure expanded significantly in China beginning in the 1990s.
21st century The 2003 SARS epidemic resulted in substantial public criticism, prompted government statements that privatizing health care in rural China had been a failure, and brought rural reform to the top of the policy agenda. The government launched the New Rural Co-operative Medical Care System (NRCMCS) in 2005 in an overhaul of the healthcare system, particularly intended to make it more affordable for the rural poor. Under the NRCMCS, some 800 million rural residents gained basic, tiered medical coverage, with the central and provincial governments covering between 30 and 80% of regular medical expenses.
Since 2009, China has been undertaking the most significant healthcare reforms since the Mao era. The availability of medical insurance has increased in urban areas as well. By 2011 more than 95% of the total population of China had basic health insurance, though out-of-pocket costs and the quality of care varied significantly, particularly when it came to serious illnesses among children. CCP leadership cadres have access to a dedicated healthcare system under the jurisdiction of the General Office of the Chinese Communist Party.
Current healthcare system
Healthcare services in China are primarily provided by state-owned hospitals. State-owned hospitals provide services for approximately 90% of patients in China. Patients generally receive their outpatient care, including vaccination, at hospitals.
State-owned hospitals are larger than private hospitals and have better physicians and medical equipment. The government regulates the price of services and wages for state-owned hospital personnel.
Health insurance is primarily operated by local governments.
The Chinese healthcare system maintains traditional Chinese medicine (TCM) and modern medicine as two parallel medical systems. The government invests in TCM research and administration, but TCM is challenged by having too few professionals with knowledge and skills and rising public awareness of modern or western models.