Hospital costs rising are causing elderly concern in Beijing

Recent reforms have caused quite a stir in Beijing following municipal officials introducing new rules on hospital billing. The changes were introduced to head off potentially exploitative hospital costs in the capital, yet public response to the changes has been somewhat chaotic. Is the reaction justified, or simply a misunderstanding? This week, Pacific Prime China looks at the elderly reaction to rising hospital costs in Beijing.

New reforms for Beijing hospitals and patients

Concerns over potential price-gouging were the catalyst for the health sector reform, with changes being introduced to help lower patient costs and reduce incentives for medical providers looking to make unjust margins on fees and products. From April 8, public hospitals were barred from marking up prescription drug prices and imposing consultation fees on patients, requiring the charging of tier of single medical fees:

Before that, Chinese patients were being played by doctors cutting deals with drug companies for kickbacks. In fact, a Shanghai urologist was found to have prescribed patients for a specific company’s drugs solely for the fact that they stood to earn a new iPhone 6 device for their troubles. The investigation, by state-broadcaster CCTV, found that some doctors were receiving cuts of up to 40% of the medication price.

Out of pocket expenses have been on the rise for patients in China, with people paying RMB 965.5 billion in 2012 (up from only RMB 587.6 billion in 2008). Considering the soaring prices and the public discontent it was fueling, the April changes were introduced to ensure that patients wouldn’t get saddled with extortionate prices fueled by pushy drug companies, while ensuring hospitals could still set reasonable prices.

Older generation concerns for Beijing hospital costs

With news spreading that hospitals would be introducing new fixed tier costs, the public found misinformed sources quoting as high as a quintupled fee for seeing a top-tier hospital. Understandably, many Beijing residents swarmed hospitals around the city in order to stock up on prescriptions, particularly elderly residents. These older patients were waiting in line for hours in order to purchase annual supplies of drugs before the April 8 deadline.

The unfortunate fact was that, while it was true that top-tier hospital visits had jumped from RMB 7 to RMB 50, many of these people would pay a lot more in out-of-pocket prescription fees than they would have paying the difference in hospital costs after April 8. Even a second-tier hospital user paying RMB 30 instead of RMB 3 would have been better off, with one woman’s prescription dropping from RMB 280 to RMB 193 because of the reforms.

Elimination of the 15% markup on many drugs around Beijing had saved patients around RMB 420 million, according to the Beijing Municipal Commission of Health and Family Planning. The introduction of the tiered pay system also saw a significant drop in hospital overcrowding across all three levels of the public hospital sector, as high as 15.1% in top-tier facilities.

Still, the example suggests that more could have been done to ensure sectors of society that need support with hospital costs the most, such as the elderly, better understood the policy changes and could make more informed decisions about their care.

China moves to better support private care for the elderly

The good news is that the Chinese Government looks proactive in supporting high standard eldercare for the older generation. With the 13th Five Year Plan planning to cut government-run nursing home beds to no more than 50% of the total, policy initiatives to ease rules and red tape for private carers as well as providing land supply and better taxation and subsidies indicates that it has better support of the elderly in its sights.

The National Health and Family Planning Commission will also start building an improved smart health and elderly care industry through the introduction of more than 100 industrial leading enterprises and a number of brands by 2020. China is set to have more than 100 model bases set in the next four years that will expand universal access to health management services and home-based elderly care country-wide.

With a rapidly ageing population in China, it’s important that people understand the need to secure good, comprehensive insurance to guarantee quality of life right through your retirement years.

Pacific Prime China: your first choice for insuring your family

If you have an elderly family member that you’ve not got health insurance for yet, give the team at Pacific Prime China a call. Their expert advisors have been connecting families and individuals with robust and comprehensive medical coverage in China for almost 20 years. Getting the right plan not only provides financial support for meeting any and all China hospital costs, but can also give you access to higher quality private institutions as well.

For a free quote or some friendly advice, contact Pacific Prime China today!

Disclaimer: Pacific Prime China solely represents, operates and manages locally regulated insurance products and services in the territory of PR China. Any references to Pacific Prime Global Company or Group, the international services, insurance products or otherwise stated written or verbally, is for introduction purposes about our overseas network only as each entity is fully independent.