Chinese tycoon offers health care help
December 29, 2006 4:45am CST
NANCHUAN, China — Liu Qun's mother roamed village to village in the 1970s, carrying a box of medicines on her back as one of Chairman Mao's "barefoot doctors." "She saved lives," recalls Liu, who as a boy helped her give injections and boil up cures. "I've still got her wooden box with the red cross on it." Three decades later, it's Liu's turn. The thickset millionaire, who made a fortune in pharmaceuticals, offers poor rural dwellers discounts on drugs and medical exams for an annual fee of $1.30 a person. Liu's Chinese Welfare Health Care Program, an alliance of hospitals, drugmakers and insurers, has signed up 300,000 members since April. He says his company, the Changlong Group, won't take any profit until membership tops 2 million people. Liu, 41, and other entrepreneurs are filling a vacuum left by nearly 30 years of market advances. As the government has freed up the economy, it has shifted social welfare costs from the state to employers and individuals. In the process, it has dismantled commune medical co-ops that provided China's peasants with free and basic — but nearly universal — health care. Mao's barefoot doctors are long gone. In their place is an epidemic of misery in rural China. Last month, Chinese President Hu Jintao promised more doctors, medicines and state oversight for the countryside, which has fallen far behind China's booming cities. The pledge is part of Hu's plan to refocus the Communist Party on social programs rather than the economy-first policies of recent years. The health care crisis in the countryside is part of a wave of rural discontent sparked by land seizures, corruption and the widening urban-rural income gap. This month, 2,000 people ransacked a hospital in southwest Sichuan province and battled police after a toddler died there. Doctors had told the boy's grandfather they needed more money before they could treat him after he accidentally swallowed chemicals, according to the Hong Kong-based Information Center for Human Rights and Democracy. The cost of care Soaring fees have put care at hospitals and clinics beyond the reach of many in the countryside, where the average annual income is $300, according to the United Nations. China's Health Ministry says high costs deter a third of rural patients from seeking hospital treatment when they need it. Forty-five percent of rural residents who are hospitalized try to leave before they've recovered, the ministry says, because they can't afford to stay. Chinese cities contain 20% of the country's 1.3 billion people but have 80% of its medical resources, says a World Health Organization (WHO) study. Overcharging is so rife that state-run media, such as China Youth Daily and China Daily, have referred to doctors as "white-robed wolves." Starved of central funding, some hospitals and doctors rely on hongbao— red packets of kickback money — from patients and drug companies. "There are abuses taking place throughout the system," says Peter Zanello, an American medical equipment consultant who has worked in China since 1988. "Before the cost of care was almost nothing and many people had their danwei (work units) pay for it. Now more patients have to pay out of their own pockets." Rural China's despair over health care is captured in popular sayings in Sichuan: Once an ambulance siren wails, a pig must be taken to market; and Once a hospital bed is slept in, a year's harvest is lost. He Guoying, 78, a bedridden farmer who suffers heart and pancreas ailments, is typical. He has been able to get treatment at Nanchuan People's Hospital in the Chongqing area but only because he has borrowed from neighbors to pay for it. "People like me can't afford expensive medical fees and drugs," he says. Ye Yuanxi, a forensic medicine specialist and director of an independent medical institute in Chongqing, fights to expose abuses. His desk is piled high with malpractice complaints, including the case of Huang Tingyu, 4, who broke her thigh bone in a fall in June 2005. The girl's parents were charged $2,500 for her treatment because doctors kept ordering expensive procedures, Ye says. "This little girl had 34 X-rays in 53 days, sometimes four a day," he says. Radiation "will do long-term damage to her, but the hospital did not care about her health, only about profit." Ye declined to identify the hospital in Chongqing, for fear of reprisals. Despite the abuses, medical care in China has made huge strides in a relatively short span. The country's average life expectancy was 35 in 1949, the year communists founded the People's Republic of China. By 1978 — after Mao deployed an army of medics to bring basic care to peasants — life expectancy had nearly doubled, to 68, according to the Ministry of Health. Even so, the gains have been uneven. In a 2005 WHO survey of 190 countries, China ranked fourth from last in equality of health care. Medical relief Chinese President Hu's prescription for the crisis is a heavy dose of government intervention. By 2010, Beijing wants a trial program of state-subsidized medical insurance to cover all 800 million rural residents. Ninety percent lack medical insurance of any sort, according to the United Nations. Early signs indicate bureaucratic inertia could undermine Hu's plan to make medical care more equitable. A high-level health care panel began meeting in September, but "the fact that more than 10 State Council departments are involved ... testifies to the complexity of China's medical reform," state-run China Daily noted. The rest of the world also has a stake in China's health care overhaul: Beijing may have prevented earlier detection of SARS (Severe Acute Respiratory Syndrome) cases in 2003 and bird flu cases last year by suppressing initial reports about rural Chinese victims. Liu, the pharmaceuticals tycoon, says private insurance plans can help fill gaps government plans don't cover. Under his program, members get a free bag of basic medicines such as pain relievers, a 13.6% discount on drug purchases and up to 20% off exams at member hospitals. Liu says his program supplements the serious-illness coverage provided under the government's fledgling New Rural Cooperative system. That plan, which also costs $1.30 a person, offers members up to 65% reimbursement for any health expenses that exceed $76. It does not cover preventive treatment or care for common illnesses. Liu says bureaucrats feel he's a threat. "Many officials think that a commercial approach is wrong," Liu says. Forensic doctor Ye questions whether Liu's $1.30 drug-and-exam plan can fix any of the fundamental problems in the system. "It is similar to a direct-sales network" Ye says. "The pharmaceutical companies will never lose out, and the (real) beneficiaries won't be the ordinary people." Liu, who credits his mother for his sense of public service, says official resistance has not dimmed his enthusiasm. He predicts his plan will have more than 20 million members in two years. "I'm not scared. They can't stop this," he says. "We feel for the masses, and we will benefit the people."