China’s journey to a healthy society by 2030 holds historic opportunities alongside daunting challenges. A healthcare ecosystem that connects stakeholders across a digital value chain will bring the dream within reach

In traditional Chinese medicine, the entire body is connected by a network of channels through which qi — or life energy — flows. The organism needs to be treated as a whole, not as a collection of isolated parts.

It is a pertinent metaphor for the needs of China’s health system today, which is beset by chronic obstructions that prevent the flow of quality care to millions of people. Healthcare needs to be set free within an integrated ecosystem that unites all stakeholders — government, patients, providers, physicians and those paying the bills — in a harmonious whole.

The challenges are enormous. Chronic disease, rising obesity and disproportionately highcancer rates are among the most serious issues preventing China’s health from matching the country’s economic might. Meanwhile, a dearth of quality care stops the rapidly aging population from making the most of their golden years.

Ambitious change is underway. Just as China has fostered a spirit of innovation — in everything from AI to 5G — that is now fuelling its 21st century ascent, the nation is also on a technology-driven mission to become a healthy society within a decade.

The Healthy China 2030 programme envisions the healthcare ecosystem of the future. The Ping An Group is committed to enabling that goal with digital health platforms such as Ping An Good Doctor and Ping An Smart Healthcare that connect stakeholders in horizontal and vertical integration.

International health and development leaders increasingly see the wisdom in this ecosystem approach. In a joint study entitled Healthy China, the World Bank and the World Health Organization call for “a new care model ... integrated with higher level care and social services”. They recommend that China “establish an effective coordination mechanism, and actively engage all stakeholders and professional bodies”.

Several infrastructural ailments stand in the way of the Healthy China vision, including an overburdened hospital system, insufficient primary care, uneven doctor quality and skyrocketing insurance costs. Medical expenses are forecast to reach nearly $2tn by 2025, even as healthcare practices remain rooted in the past.

The need for a Chinese health ecosystem becomes clear upon examination of how specific pain points afflict the five healthcare stakeholders:

• Government: Central and local authorities shoulder a massive burden. The government manages 1m medical institutions and accounts for half of healthcare spending. Powerful new digital solutions can modernise healthcare standards and reform the troubled social health insurance system.
• Patients: China has 1bn people with suboptimal health, including 400m chronic disease patients. People need better quality care, reduced wait times and manageable costs. Telemedicine, online insurance and other digital tools can combine to offer fast relief.
• Hospitals: Resource distribution among China’s 1m medical institutions is uneven. About 2,500 public hospitals account for nearly a quarter of all visits and the best doctors and equipment are centred in a handful of mega-city hospitals. Improving lower-tier hospitals and boosting primary care quality through digital innovation can level the field.
• Physicians: China faces a severe shortage of general practitioners. The GP ratio to specialists is 1:7 compared to 1:3 in the United States. About 70 per cent of doctors work more than 50 hours a week, resulting in low performance. Online medicine and digital training and diagnostic tools can ease the burden.
• Payers: China’s healthcare-for-all system is currently unsustainable and prone to fraud. In 2019, insurance expenditures rose by 12 per cent while revenue increased by 10 per cent. Out-of-pocket spending represents 50 per cent of the medical bill with the remainder coming from social health insurance. Innovative private insurance and AI tools to better manage and set standards for social health insurance can alleviate the healthcare payer crisis.

Ping An is committed to healing these pain points through the 12 entities in its healthcare ecosystem. The three main platforms are Ping An Good Doctor, which provides telemedicine for patients; Ping An Smart Healthcare, enabling medical provider integration; and Ping An HealthKonnect that offers risk management for insurers.

These solutions do not work in isolation, and their potential is maximised through synchronised deployment. Together they incorporate decades of financial, healthcare, risk management and machine learning acumen across the entire Ping An Group.

Ping An's healthcare ecosystem rests on three pillars. Horizontal integration fosters synergies across the value chain of patient, provider and payer. Vertical integration enables government with technologies to coordinate core resource deployment and improve the service quality and operational efficiencies of medical providers. Ping An’s technologies, meanwhile, empower members of the ecosystem and drive its future.

“The China healthcare market, everyone knows, is very big. Just as importantly it’s very complex,” said Jessica Tan, Co-CEO of Ping An Group, on a recent investor day on healthcare. “In order to capture the value, it’s not good enough to simply cherry pick investments. Out of the entire ecosystem, you have to penetrate to the each of the key stakeholders.”

For the Ping An Group, ecosystem integration is also a powerful generator of business value, unleashing synergies. For example, up to 20 per cent of Ping An’s new financial customers each year come from its healthcare ecosystem. The healthcare link fosters a benign cycle of joint financial value enhancement through factors such as lower premiums and longer lives. Among Ping An’s 218m financial service customers, 61 per cent (or 132m) are using at least one of its healthcare services (three, in fact, on average).

At the heart of the value proposition are historic economic opportunities in a healthcare market expected to triple in value to Rmb16tn by 2030. A transformative healthcare ecosystem, says a McKinsey report, makes China “the most exciting healthcare story in the world”.

China has emerged as a leader in green technologies and digital connectivity in recent years - after a long time in the wilderness of both fields. Ping An is pouring resources into R&D to enable a similar transformation in Chinese healthcare.

Ping An’s vision goes beyond lifting China’s health to globally acceptable standards. It means inventing next-generation solutions for the entire planet, combining digital acumen with world-leading medical and genomic data resources.

In this vision, precision medicine will pre-empt genetic diseases decades before they become apparent. The elderly will receive cancer treatment in the comfort of their homes. And 5G-enabled robotic surgery will save lives in remote regions and after earthquakes.

“We can't magically double the number of qualified medical staff in a short amount of time,” Tan said. “This is a long-term game. But what technology can do is to improve the level of service quality across all these physicians and medical staff.”