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Research report on medical reform in Suqian, Jiangsu is released: People’s medical burden has increased

Editor’s note: On March 23, after the newspaper “Suqian responded to the “sell-out” medical reform for the first time in three years” was published, Beijing Professor Li Ling, deputy director of the University's China Economic Research Center and an expert on health economics, called this newspaper and said that she would go to Suqian to investigate in person.

Suqian’s medical reform has been undergoing controversy among media and experts across the country.

If Suqian's reform is affirmed, then this market-oriented medical and health reform model with property rights reform as the core and market-led will become a powerful argument for the "market faction". On the contrary, the "government-led faction" found a target for criticism in this debate. In other words, the evaluation of Suqian’s medical reform is related to the choice of the direction of my country’s medical reform.

In April this year, Professor Li Ling, who has always advocated government-led medical and health care, and her research team of about 10 people went to Suqian twice. The first time, they went directly to the hospital for "treatment" as patients; the second time, they openly contacted the officials.

In order to ensure that the information is not missing or distorted during the transmission process, according to Professor Li Ling’s request, this newspaper publishes the full text of the research report of the research team after slight deletions (with the author’s consent). It is said that this report has been sent to relevant national departments at the same time.

Previously, when this newspaper published a series of medical reform investigation articles, it has been stated that the government, media, experts and scholars should all adopt a more cautious attitude towards medical reform, a major event involving the national economy and people's livelihood. This newspaper will continue to serve as a faithful recorder of this special historical period.

From April 6 to April 10, 2006, and from April 28 to 30, the medical and health reform research team of the China Economic Research Center of Peking University went to Suqian City, Jiangsu Province twice to conduct research on the urban areas of Suqian and Shuyang. Conduct research on the medical and health conditions in counties and villages.

The basic method of the research is not to alarm the local government. Nearly ten health economists and students went to various hospitals as patients, surveyed and interviewed doctors and patients during the treatment process, and then contacted the leaders of the health authorities. Communicate with the hospital director and relevant personnel, report what you see and hear, listen to their opinions and explanations, and proofread and confirm the research results.

We believe that the economic construction-centered reforms carried out by the leaders of Suqian City in recent years under the leadership of the Suqian people are bold in thinking, bold in doing, thrilling, and commendable. However, the reform ideas in some aspects violate the social and The objective laws of economic development, especially the application of comprehensive market-oriented reform methods to the medical and health fields that have been proven to be unworkable by theory and practice. Therefore, the current problem of "expensive medical treatment" in Suqian City has not been solved. Instead, the medical burden of the people has increased, and the potential medical and health problems are worrying.

This report combines the survey situation, relevant background information and relevant theories of health economics to conduct a preliminary analysis of the achievements and problems of Suqian's medical reform.

Suqian City’s unconventional catch-up development is the background

(1) Before the medical reform, the government was unable to make the necessary investment in medical and health services

Suqian City Located in northern Jiangsu, it is a newly established prefecture-level city in 1996. It has jurisdiction over three counties, Shuyang, Sihong and Siyang, two districts, Suyu and Sucheng, and a provincial economic development zone. It has a total population of 5.17 million and a land area of ??8555 square kilometers, the economy is relatively backward. For example, Shuyang is one of the 19 old revolutionary areas in the country. At that time, its economic strength was the last in Jiangsu. 8 of the 38 towns in the county were provincial-level poverty-stricken towns.

The economic backwardness has led to financial difficulties in Suqian area, which is basically in a "finance to eat" situation. The development of social undertakings such as medical care and education that require financial support faces great difficulties. Especially after the fiscal decentralization reform, the responsibilities of social public expenditure have also been decentralized to local governments. The Suqian government does not have a lot of funds to invest in medical and health services, which directly leads to insufficient health resources and poor conditions and low levels of grassroots medical and health units.

(2) Medical reform is part of Suqian’s unconventional economic catch-up development

Faced with the reality of economic backwardness, Suqian has adopted an unconventional development model in order to catch up with the developed economy. area.

By "supplying some from the top, some from enterprises, some from the people, and some from the government", we will speed up infrastructure construction and optimize the environment to attract investment. First, borrow money to improve the environment and infrastructure. The number of companies attracted by investment will increase, tax revenue will increase, and land prices will appreciate. Then use land transfer fees and tax revenue to repay the borrowed money and create a better environment, thereby achieving rolling development. .

In this process, the local government adopted many special policy measures, such as ordering public employees to lend their salaries to build roads, requiring enterprises to advance funds to build office buildings, and contracting nine municipal roads in the city to the district personnel department. Nine departments including the bureau are responsible for the construction, and as the assessment task of the main person in charge, the investment invitation indicators are assigned to each unit. In Suqian, it can be clearly felt that all cadres are committed to economic construction, with economic development as the starting point and improving efficiency as the goal.

Correspondingly, Suqian’s construction of social undertakings, especially education and medical health, is carried out by dumping the burden (the government completely withdraws from the medical field), selling schools and hospitals (revitalizing the stock of assets), and introducing social capital to expand resources and promote competition to improve efficiency. Therefore, the realistic background of Suqian's more radical medical reform approach is that when poverty is poor, change is necessary, and there is no solution.

Achievements of Suqian’s medical reform

(1) Reduction of government financial burden

134 public hospitals in Suqian area have carried out property rights system reform, including 124 township hospitals The hospital and 10 hospitals above the county level have formed partnership, mixed ownership, joint-stock, sole proprietorship and other medical entities. Although some hospitals have joined forces with external public hospitals (such as Suqian People's Hospital of Drum Tower Hospital Group), or some external public hospitals have established branches in Suqian (such as Shanghai Oriental Hospital Suqian Branch), currently all medical service institutions in Suqian area have been organized by Private capital purchases or operates, and the Suqian regional government has completely withdrawn from running hospitals.

In such a restructuring process, the government is the most direct beneficiary. It can not only revitalize the hospital's assets through restructuring, but also cash in on the government's accumulation in the medical field over the past 50 years. At the same time, it can wait until the tax holiday for private hospitals. After that, government taxes will also increase.

(2) Rapid increase in the number of medical resources

Suqian has adopted a series of policies to encourage social capital to enter the medical service field, and the number of hospitals and total medical and health assets have expanded rapidly. From 2000 to 2005, the city's medical and health assets increased from 495 million yuan to 1.778 billion yuan, which was 3.59 times that before the reform. Five years ago, there were more than 130 hospitals of various types in Suqian City, but by 2005, there were more than 400 hospitals of various types in Suqian. Our research found that various types of hospitals and clinics have been established on the streets of Suqian, most of which were opened in recent years. The increase in medical institutions has led to the corresponding expansion and increase of medical teams and medical equipment.

(3) The hospital's operating methods have changed, management has been strengthened, competition methods have been enriched, and the enthusiasm of medical staff has increased.

After the restructuring, the hospital no longer receives financial subsidies from the state, and currently has no social support. Donations are completely self-financed.

Under the pressure of competition, hospital owners (mostly shareholders) have introduced corporate operating mechanisms and effectively strengthened the management of the hospital; they have improved the service attitude of medical staff, especially in attracting patients. work, advertising vigorously promotes the hospital’s experts and advanced equipment. Hospital and drug advertisements can be seen everywhere on local TV programs and newspapers; registration fees are reduced, individual medical examination fees are reduced, and unit prices of medicines are reduced; additional services such as mobile buses for free transportation of patients are provided. Many measures have indeed brought benefits to the people and have been recognized by the people. According to the survey, people's satisfaction with the hospital's service attitude has increased significantly.

Our survey found that some doctors will ask patients whether they have enough money. If they don’t have much money, they will prescribe less medicine and ask the patient to come back after a while and bring money. In the future, the prescription for the medicine will be given to the patient together, so that the next time he comes, he can directly prescribe the medicine without having to register and see a doctor. On the one hand, this reflects that the hospital is more considerate of patients. On the other hand, it may also be a reason for the decline in average outpatient costs. Patients visit multiple times, and the cost each time drops.

It is worth noting that both for-profit and non-profit hospitals have strong profit motives and capabilities. At the same time, the current instability of health reform policies has intensified the profit-seeking behavior of investors who demand quick recovery of their investments in the short term. Therefore, the first consideration of almost all investors in medical institutions is to strive to quickly recover their investment under the current market competition and regulatory conditions. According to the director of a hospital in Shuyang, the profit margin of hospitals is now generally above 50%, so investing in a hospital can usually recover the investment within two years.

Excessive profit-seeking motives have led most hospitals to adopt an incentive policy of paying medical staff based on department performance. According to our interviews, hospitals will use various methods to obtain designated qualifications for medical insurance and rural cooperative medical care; they will pay kickbacks to village doctors and grassroots doctors in the hope that they will recommend patients, and the kickbacks are on the rise. A local village doctor said that if he introduces a patient, the orthopedic hospital will give him a 10% kickback; the hospital will pay taxi drivers and emergency centers to obtain patients.

(4) The mobility of medical staff has increased, and their income has also increased

The reform has streamlined the hospital's employment mechanism, and the hospital can eliminate the fittest employees. Hospitals under competitive pressure need excellent medical staff to attract patients, and competition among hospitals to "poach doctors" is fierce. The flow of medical staff is freer, especially the higher-level medical staff who move between hospitals very frequently. Many doctors come back from training today, receive professional titles, and then "change jobs" tomorrow.

In order to retain and attract excellent medical staff, hospitals must change their internal allocation and incentive mechanisms to increase the income of medical staff. According to our research, the average monthly salary of doctors in Suqian has increased from 2,000 yuan to 3,000 to 4,000 yuan. The income gap has widened within the hospital. Doctors with good skills, chief physicians and doctors who own shares have higher incomes. The income of general doctors is worse. The salaries of hospital nurses and support staff are very low after privatization, from more than 1,000 yuan to 500 to 600 yuan.

It is worth noting that in the process of increasing income, the sense of belonging has become a reward that many medical staff are more concerned about. Judging from the effects of restructuring, hospitals where doctors own shares have developed relatively more stably and are more likely to gain recognition from the people. We conducted research and visited a hospital in Shuyang, which was auctioned to private capital. An old doctor who was retained after retirement told us that working in the hospital used to give him a sense of belonging, but after the restructuring, his job became just a part-time job. The next night, more than a dozen medical staff resigned collectively to go to another newly built hospital. The main reason was that the hospital gave them shares.

(5) Rapid increase in medical service items

Competitive pressure has prompted hospitals to introduce medical experts and advanced equipment to expand the scope of medical services. After the medical reform, more than 200 medical service items have been added to the Suqian area, and many complex surgeries can also be performed in Suqian. This makes it easier for people to seek medical treatment to a certain extent.

It is worth noting that medical equipment in the Suqian area has a tendency to be over-developed. In the process of over-expansion of medical services into high-profit projects, the development of software such as the technical level of medical personnel has not kept up. According to our research, many inspection operations do not meet the standards, and some hospitals perform surgeries in violation of regulations. For example, a certain first-level hospital in Shuyang actually performs gastric cancer surgery. The attending doctor is a former township health center doctor who graduated from a health school.

(6) Registration fees, individual examination prices and drug unit prices have been steadily declining

Competitive pressure has prompted hospitals to reduce registration fees, individual examination prices and drug unit prices. The registration fees in almost all hospitals are very low. In some hospitals, you can visit multiple departments with one registration, and in some hospitals, you don’t even need to register. Competition has formed between some basic medical treatments and conventional treatments, and the individual charges for many conventional medical services have also been reduced. For example, the price of CT has dropped from more than 300 yuan to more than 100 yuan; and the price of B-ultrasound has dropped from more than 100 yuan to more than 60 yuan.

Since the opening of pharmacies has been liberalized, hospitals not only face competition among hospitals, but also with pharmacies. Generally, there will be a pharmacy at the door of the hospital, and there will be several pharmacies around large hospitals. Therefore, the unit price of medicines in hospitals has indeed dropped, and some common low-price medicines have also reappeared.

The core issues of medical and health care have not been solved, and at the same time, some new problems have arisen

(1) "Expensive medical treatment" has not been solved - another distortion of medical expenses after the introduction of market mechanisms

Judging from the above phenomena, the number of medical institutions has increased and competition has intensified. People do have more choices for medical treatment, and they do feel that hospital service attitudes have improved. At the same time, hospital registration fees have been reduced, and the charges for individual examinations and the unit prices of medicines have indeed declined steadily. So, can we say that after this medical reform, ordinary people have received convenient, high-quality, and affordable medical services?

1. Digital paradox: Is medical care more expensive or cheaper?

Data provided by the Suqian Health Bureau show that compared with 2005, per capita outpatient expenses dropped by 8.3% in city and county hospitals and by 25% in township hospitals. The daily charge per hospital bed fell by 10% in city and county hospitals and by 15.5% in township hospitals. The average medical expenses for discharged patients decreased by 1.0% in city and county hospitals and by 13.5% in township hospitals. In exchanges with officials from the Suqian Health Bureau, they also admitted that these figures may not be reliable because there is currently no good statistical method.

Even if these data are correct, while the above-mentioned price decreases, not only has no hospital gone bankrupt, but the income of many hospitals has increased significantly. For example, the newspaper reported that Suqian People's Hospital's revenue in 2004 was more than 90 million yuan, and in the first half of 2005, the hospital's revenue reached 65 million yuan; "Shoyang County People's Hospital...the revenue from the orthopedics department alone increased from 1.8 million yuan "It increased to 7.2 million yuan." A department director of Renren Hospital also told us that the 30 million yuan loan for the new building was earned back in three years. Moreover, up to now, new hospitals are still being established in Suqian. Without higher profit margins, such a trend would not be possible.

Per capita outpatient expenses and hospitalization expenses have declined, while the number of hospitals has increased rapidly, and hospital income has also increased rapidly. If the data is correct, then medical demand must continue to grow significantly. Suqian is located in northern Jiangsu and is relatively closed. Its population size is relatively stable, and the number of outpatients is not very large. It is impossible for medical needs to increase on such a large scale and continuously. Are medical expenses more expensive or cheaper?

2. Theoretical analysis: To give full play to the market mechanism, we cannot avoid the own laws of the medical and health field.

The medical and health care field has its own laws. The first one is the serious asymmetry of information between supply and demand. The supplier is in a natural monopoly position and it is a forced-selling market. If the supplier has too much profit motive, the hospital will always have a way to obtain sufficient income through some means, such as inducing demand, and the interests of patients will be harmed.

Theoretically, "price reduction" and "cost reduction" are two concepts. In fact, the prices of medical services and some medicines in our country are currently controlled by the state. The "expensive medical treatment" felt by ordinary people mainly refers to medical expenses, which is the product of price and quantity.

What ordinary people can best observe and compare is price information. Hospitals attract patients by lowering individual prices, but as for "volume", they basically can only follow the doctor's arrangements. Although the "price" can be limited, the "volume" cannot be limited, and the total medical expenditure of the people is still rising.

Second, in the competitive medical market, there will be a "medical equipment competition." Both theory and practice show that due to the serious information asymmetry between doctors and patients, patients lack the ability to search for the lowest price. Patients usually choose brand hospitals, famous doctors and high-tech equipment. Therefore, competition between hospitals is not mainly reflected in price competition, but in the so-called "medical equipment competition" between doctors' technology and equipment, which will lead to an increase in overall medical expenses. Because these high-tech and advanced facilities are often redundant and unnecessary. The wool comes from the sheep, and the hospital's new building, new equipment, and the high cost of recruiting talents will ultimately be borne by the patients sooner or later.

(Limited by space limitations, regarding whether Suqian’s medical reform can solve the core problems and some new issues arising from it, this edition will continue to publish the relevant investigation report of the medical and health reform research group of Peking University’s China Economic Research Center tomorrow. Part - Editor's Note)

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