Editor’s note: This series was written by Federico Sferrazza, digital marketing manager at Daxue Consulting, a market research company based in China. The images were created by Kevin Maher, co-founder of information design agency Diatom. Part 1 looks at the current problems with China’s healthcare. Part 2 will analyze how current technologies, particularly mobile medical healthcare, will help alleviate many of these issues.
Mobile technology, social media, and e-commerce seem to dominate the conversation when it comes to digital technology in China. The healthcare industry, which traditionally lags in digital innovation relative to its peers, ranks among the least innovative sectors. New technologies pose a significant challenge for the healthcare sector, but also represent a tremendous opportunity for innovation and individualization of treatment to suit patients’ needs. Progress in digital technology has already left a radical mark on Chinese consumer behaviors and lifestyles; the healthcare industry should follow suit by moving quickly to embrace digital innovations. Private digital investment in the health industry reached $1.4 billion for the first semester of 2016, surpassing total investment in 2015. With a revolution off the table for now, here instead are the most problematic trends in healthcare for China:
The One-Child Policy and China’s Aging Society
China’s rapidly aging society and subsequent expansion of government support programs mean the Chinese healthcare industry has garnered a larger share of public attention than before. China is growing older, and this trend shows no signs of slowing down. In 2016, 142 million Chinese were 65 or older, equating to 10.35 percent of the population. This number is expected to double to 330 million by 2050 – nearly one in four Chinese. But the demographic crisis will occur even sooner: China is expected to become the world’s most aged society by 2030.
China’s more than 35-year-old “one–child policy,” which ended in January 2016, successfully stemmed population growth and ensured economic stability. The total fertility rate (TFR) dropped from 3.78 births per woman in 1979 to 1.6 per woman in 2016. But the effects of the one-child policy were not all desirable; the proportion of elderly Chinese relative to the overall population has increased significantly over the past decade and a half. Further, it appears that repealing the controversial policy has not delivered the results sought by the Chinese government.
Long-term suppression of fertility in females and high costs associated with childbirth and childrearing significantly reduced people’s willingness to have children in China. Meanwhile, slow population growth also relieved stress on scarce educational and medical resources. Due to improvements in quality of life and medicine, the average life expectancy for China increased from 71.4 to 77 years and is projected to reach 80 in 2050.
It seems likely that this fast growing, yet aging population will raise concerns for the development of the world’s second-largest economy. The elderly dependency ratio, which represents the number of elderly people per every 100 working people, will increase from 13.7 to 46.7 by 2050. The world watches on as China prepares to deal with mounting strains on an already troubled healthcare system.
Rise of Chronic Diseases
The increase in the number of elderly people corresponds with rising life expectancy and prevalence of chronic illness. With more and more Chinese suffering from chronic illnesses, plus expensive treatment costs and longer recovery times, the Chinese healthcare system is laden with tension. Moreover, chronic disease is now a major public health issue in China.
According to The State Council Information Office of the People’s Republic of China, doctors diagnose 260 million people with chronic illnesses every year. Chronic diseases are responsible for 85 percent of yearly mortalities. The diseases that account for the most deaths are cancer (27.79 percent), cerebrovascular disease (20.22 percent) and heart disease (21.3 percent). Rising rates of incidence and the spread of chronic diseases prompted a serious government response. To combat chronic diseases, the government created the “Chinese Chronic Disease Prevention Work Plan (2012–2015).” A focal point of the prevention plan is the use of monitoring devices to treat chronic diseases. Regardless, chronic diseases are expensive to treat. The treatment of chronic diseases accounts for 70 percent of healthcare spending. The World Health Organization estimates that heart disease, stroke, and diabetes altogether cost China 3.91 trillion RMB (US $558 billion) between 2006 and 2015.
To combat chronic diseases, the government created the “Chinese Chronic Disease Prevention Work Plan (2012–2015).” A focal point of the prevention plan is the use of monitoring devices to treat chronic diseases. Regardless, chronic diseases are expensive to treat. The treatment of chronic diseases accounts for 70 percent of healthcare spending. The World Health Organization estimates that heart disease, stroke, and diabetes altogether cost China 3.91 trillion RMB (US $558 billion) between 2006 and 2015.7The continued rise of chronic disease could mean even higher costs in the future. The National Health and Family Planning Commission of the PRC estimates the total cost of medical care in 2012 at 2.891 trillion RMB, an increase of 456.85 billion RMB over 2011. Despite steep medical bills; much Chinese do not receive adequate care for their chronic diseases. In the future, it is likely that chronic disease treatment will consume more resources. The Chinese government is currently working to provide all citizens with basic medical insurance. However, the growth of chronic diseases has made this endeavor costlier than expected. Therefore, it is critical that the government adopt policies to treat better and prevent chronic illness.
Despite steep medical bills; many Chinese do not receive adequate care for their chronic diseases. In the future, it is likely that chronic disease treatment will consume more resources. The Chinese government is currently working to provide all citizens with basic medical insurance. However, the growth of chronic diseases has made this endeavor costlier than expected. Therefore, it is critical that the government adopt policies to treat better and prevent chronic illness.
The Diabetes Epidemic
China currently faces the world’s largest diabetes epidemic, one worsening at a fearsome pace. The explosion in diabetes incidence has been considered by previous studies, and the most recent research found that China has overtaken the USA in terms of cases; according to the latest data, 11.6% of Chinese adults have diabetes. The population of Chinese with diabetes stands at some 114 million people — about a third of all people with diabetes.9In 2015, China was home to estimated 110 million people suffering from diabetes – roughly 11 percent of its population, according to the International Diabetes Federation’s Diabetes Atlas (IDF). Also troubling was the study finding that of the 99,000 people surveyed, half had pre-diabetes blood sugar – abnormally high, but not high enough to diagnose diabetes. Some projections even suggest 493.4 million Chinese could be afflicted by pre-diabetes.
These findings indicate the enormity of diabetes as a public health problem in China. In the 1980s, Chinese doctors rarely saw diabetes; China has since risen to claim the most diabetes cases in the world.
Jeppe Thieseen, Vice President of Marketing at Novo Nordisk in China, estimates that 70 million diabetics—an astronomical number nearly equal to the population of Germany—live without treatment.
Diabetes is set to become the heaviest burden on the Chinese healthcare system, as the IDF estimates diabetes accounts for 13 percent of medical expenditure in China, with yearly costs estimated to reach $47 billion by 2030. The number of people affected by diabetes has spiked in recent years and is expected to reach 150 million Chinese by 2040. The biggest challenge now for the Chinese government is to raise public awareness of the symptoms of diabetes and the benefits of early diagnosis.