(Yicai) Dec. 2 -- China has unveiled a plan to allow wholly-owned private hospitals in eight major cities and one province to further open up the country’s healthcare sector, attract more overseas investment, and better meet patients’ medical needs.

Under the plan issued by the National Health Commission on Nov. 29, the trial areas are Beijing, Fuzhou, Guangzhou, Nanjing, Shanghai, Shenzhen, Suzhou, Tianjin, and Hainan province. General, specialty, and rehabilitation hospitals fall within its scope, but traditional Chinese medicine hospitals are excluded along with the acquisition of public hospitals by foreign entities.

The plan details the tasks, conditions, and management measures needed to further open up the healthcare sector to foreign entities, building on a pilot program for the nine designated areas jointly unveiled by the NHC, the Ministry of Commerce, and the National Medical Products Administration on Sept. 8.

China had more than 38,000 hospitals last year, with public hospitals comprising less than one-third of the total while handling nearly 84 percent of all patient consultations nationwide.

“Wholly foreign-owned hospitals will need to differentiate their role and service model from existing medical institutions,” Cai Jiangnan, executive director of the Shanghai Chuangqi Health Development Institute, told Yicai. “This way, they will not only facilitate access to medical care for foreign nationals, but may also attract some affluent domestic patients who might otherwise seek advanced treatments overseas.”

China should also welcome foreign hospital brands that are relatively standard in their own countries by providing them with the same regulatory support as other medical institutions, according to Zhao Dahai, a professor at Shanghai Jiaotong University's School of International and Public Affairs.

As to whether treatments received at these wholly-owned private hospitals could qualify for reimbursement under China's national medical insurance system, experts noted that joint venture hospitals have become designated medical insurance institutions in the past.

But costs at wholly foreign-owned hospitals are typically high, they said, so even if the national insurance system could refund part, the amount patients would have to pay out of their own pockets would remain substantial. The experts recommend assessing the financial capacity of the insurance systems in the designated pilot areas before reaching any decisions.

Editor: Futura Costaglione