China’s announcement on Friday that healthcare service providers from Taiwan, Hong Kong and Macau will be able to operate fully owned hospitals in all of its 333 provincial cities has been met with a lukewarm response from Taiwan’s healthcare community.
Investors from Taiwan were originally restricted to running fully owned hospitals in four provinces — Jiangsu, Fujian, Guangdong and Hunan — as well as in the special municipality of Shanghai. Medical sources said that unless manpower recruitment and health insurance coverage issues can be resolved, the new policy is not likely to attract further Taiwanese investment in Chinese hospitals.
Landseed International Medical Group was the first to get the green light for a fully owned hospital in Shanghai, after such investment was allowed under the cross-strait Economic Cooperation Framework Agreement in 2011.
Landseed International Hospital Shanghai is also the largest fully foreign-owned general hospital in China.
Landseed Superintendent Chang Huan-chen (張煥禎) said the company managed to roughly break even last year.
“But there is still a long way to go before we can earn back our initial investment,” Chang said.
Landseed Shanghai now has 100 beds, 30 full-time physicians and 30 part-time practitioners. Chinese patients made about 150,000 visits to the hospital last year, Chang said.
Due to high investment costs and low returns, Landseed is still the only Taiwanese conglomerate that has set up a fully owned hospital in China since 2011, he said.
According to him, China’s new opening of the industry will have a limited effect on attracting Taiwanese medical groups to follow suit because of the various hurdles.
First, Taiwanese and foreign-owned hospitals in China have a hard time recruiting medical practitioners.
Chinese doctors tend to prefer working at China’s public hospitals rather than at private ones.
Under China’s current system, physicians’ evaluations and promotions are based solely on performances at public hospitals, while service records at private hospitals are overlooked. As a result, few qualified Chinese physicians are interesting in work at foreign-owned institutions.
Taiwan and China also do not recognize each other’s medical certifications, which makes it difficult for Taiwanese hospitals in China to hire full-time physicians from Taiwan.
Furthermore, China does not yet allow the public to seek medical services at foreign hospitals — including Taiwan-invested ones — in all fields, effectively discouraging its citizens from visiting foreign-owned hospitals.
“China must take steps to remove these barriers if it truly wants to liberalize foreign investment in the hospital sector and speed up its healthcare reforms,” Chang said.
Shin Kong Medical Group general manager Hung Tzu-jen (洪子仁) shared Chang’s view, saying that few large Taiwanese healthcare groups would invest in China’s hospital sector until bold steps are made to improve the medical investment climate.