As China’s elderly population is steadily increasing along with the general demand for quality health services, online health care may provide solutions in the near term, increasing the opportunities for foreign investments.
China’s health industry has entered the digital age, which has facilitated changes for many hospitals and private entities in the sector. Online healthcare, featuring online medical advice, has become a new reality for an increasing number of Chinese citizens. The development of the sector has been greatly boosted by the COVID-19 pandemic, as it has received close attention from both government authorities and technology companies to expand market access.
What is online health care?
Online health care is a subcategory of the broadest digital healthcare sector, which includes artificial intelligence and machine learning for diagnosis and treatment. Different from traditional settings, where patients and providers interact in clinics or hospitals, healthcare takes place online through virtual platforms that can be accessed via mobile devices and computers. These platforms enable a wide range of health services and products, including medical consultations, hospital appointment scheduling, medication prescribing, health information management, health insurance, and telemedicine.
To raise the burden of visiting overcrowded hospitals, online healthcare services bring more convenience to consumers who seek medical treatment. With more immediate feedback, consumers concerned about their symptoms can obtain reliable information for self-examination and self-medication, reducing the need to see a doctor in person. This service is also shifting the healthcare industry from its traditional focus on treatment to prevention.
Online healthcare prices vary by type of service. The most common channel is text and image consultations, which allow patients to access certain interactions with their physicians over a specified period of time. Other services are audio and video consultations.
according to research data, the average price for a 48-hour text/photo service package is 65 CNY ($9.64), while 8.32 RMB ($1.23) per minute for audio consultation, and 17.56 yuan ($2.6) per minute for video consultation. Prices also vary widely across platforms, reflecting differences in provider quality, marketing strength, and consumers’ willingness to pay.
|Price and consumer preferences for different types of online health care services|
|Service types||price||Consumer preference|
|Image/Text (per package)||65.1 CNY (9.64 USD)||71.6%|
|voice (min)||8.32 yuan (1.23 USD)||16.4%|
|video (min)||17.56 CNY (2.6 USD)||12%|
A major innovation in online healthcare markets is the development of a reputation system to systematically collect and publish user feedback, which helps consumers evaluate the quality of service providers in a more transparent manner. Online healthcare may also provide a solution to mitigate geographic disparities in access to quality medical services, reducing system pressure due to regional disparities in the state of healthcare infrastructure.
What are China’s policies for online healthcare?
Online healthcare is an integral part ofHealthy China 2030A blueprint for achieving the country’s long-term economic and social development goals. Since its introduction in 2016, the Chinese government has stepped up efforts to support the development of the health technology industry through a series of policies and regulations.
In April 2018, the General Office of the State Council issued a document titled “Internet Plus for Medicine and Health“detailed a comprehensive framework for integrating the internet and information technology into healthcare. The regulations introduced supply-side structural reform to mitigate the unbalanced and inadequate development of the sector. The health technology boom in China came after the implementation of the comprehensive framework.”
In August 2019, the National Health Care Security Administration (NHSA) Launched the electronic medical insurance system – Regulating prices and insurance policies to allow coverage of medical services online through the country’s medical insurance system. Patients can access hospital services via WeChat and Alipay platforms. This incorporation is further strengthened by NHSA guidance in October 2020 to Actively promote the payment and management of medical insurance for medical services “Internet +”.
In May 2020, the National Health Commission (NHC) released issued a statement to encourage Provincial governments to set up their own regulations to manage online medical providers and speed up market access for internet-based hospitals. Later in September of that year, the State Council again noted Internet-based health clinics need to expand. Since then, many regional governments have issued regulations to improve online healthcare market conditions.
Internet health is also Critical focus point for 14The tenth Five Year Plan (FYP), which urges greater interdependence between regions, balanced development between cities and countries, and the use of big data. The government’s next goal is to accelerate the incubation of the online healthcare market and promote industrialization and the widespread application of big data in precision medicine, health management, drug research and development, and medical insurance.
Market status and outlook for the online healthcare sector: an ecosystem in the making
Online healthcare has experienced massive growth during the COVID-19 outbreak, with a significant increase in the number of users. With access to hospitals restricted due to the lockdown, many have turned to online medical service sources. Alibaba points health It has more than 15,000 contracting medical institutions, including nearly 400 tertiary hospitals in 17 provinces, associated with medical insurance payment services. In the first quarter of 2020, the company reported that the total net repeat active users of Alipay’s healthcare channel exceeded 390 million.
Sensing the opportunity, many tech giants are rushing into this emerging industry. Currently, there is 1748 Online Healthcare Startups In China. Of all who share a cake, Bing An is a good doctorLtd., a Hong Kong-listed subsidiary of insurance giant Ping An, reported a 26.7 percent annual growth in average daily online consultations to 831,000 in the first half of 2020, with revenue from online medical services doubling to 694.9 million yuan. (US) $101.56 million.
Lessons learned from epidemic management could profoundly shape the direction of China’s health care market, which is expected to nearly triple from 6.5 trillion yuan (960 billion US dollars) in 2019 to 17.6 trillion yuan (2.61 trillion US dollars) by 2030. Despite this growth, the market currently remains relatively undeveloped, with China’s health spending – including pharmaceuticals, medical devices, distribution, hospitals, pharmacies, and insurance – representing only 7.12% of GDP in 2021, while the US reached 18% in the same year. The gap leaves enough growth potential for healthcare companies.
The online healthcare industry is still in its early stage of development. Frequent building with similar functionality on different platforms may lead to a trap for consumers and investors. More efforts are needed to clarify the value of each platform and create different operating strategies and service models according to distinct characteristics. With favorable government policies, more stable and sustainable planning will be crucial to enhancing and strengthening the capabilities of the industry.
However, the market still represents a promising prospect. China’s healthcare industry has shown an attractive performance with 160% cumulative return over the past ten years. The success of digital health companies depends on vast amounts of medical data from Chinese patients. China’s demographics are a critical factor contributing to prosperity, with the elderly population expected to grow (65 years or older) From 10 percent of the population in 2017 to 20 percent by 2037.
Online healthcare in China is expected to receive more priority attention from the government. Foreign investors involved in providing healthcare services are suggested to pay attention to this rapidly developing sector.
In addition, the pace of urbanization and a growing middle-class population is also supporting the growth of domestic demand for high-quality healthcare products and services. Faced with a rapidly aging population and citizens demanding high-quality services, China’s healthcare sector already positioned to become a priority area of government attention in the next decade. As a major branch of the industry, online healthcare, with its easy access to the public, sees great growth potential.
How can foreign investors participate in the business?
Healthcare remains a positive area for foreign investment. in the latest Index of industries to encourage foreign investment (202Version 0), China encourages foreign investment in multiple sectors related to online healthcare, including:
- Online health care
- Digital medical system, community care, personal health maintenance related product development and application
- Medical information services such as health advice, health management and medical knowledge
Overall, online healthcare, having experienced significant growth during the pandemic, presents great opportunities for investors.
information about us China briefing authored and produced Dezan Shera and Associates. This practice assists foreign investors in China and has done so since 1992 with offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen and Hong Kong. Please contact the company for assistance in China at email@example.com. Dezan Shera & Co. has offices in VietnamAnd the IndonesiaAnd the SingaporeAnd the United StateAnd the GermanyAnd the ItaliaAnd the IndiaAnd the Russiain addition to our commercial research facilities along Belt and Road Initiative. We also have partner companies that help foreign investors in FilipinosAnd the MalaysiaAnd the ThailandAnd the Bangladesh.