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Chuiyangliu Hospital, pictured in Beijing in January 2023, has completed renovations in recent years that have allowed daily patents to increase sixfold to 5,000 a day, official estimates say.

Yin Hon Chow | CNBC

BEIJING – Health, exercise and wellness top the shopping list for anyone in their late 20s and older in China. That’s according to an Oliver Wyman poll late last year, just as China was finally beginning to end its Covid controls.

Of those who plan to spend more on this health category, 47% said they plan to spend more on health insurance in December. That’s up from 32% in October, the report said.

“After this latest wave, there are much bigger health concerns, but after the entire pandemic, there has been a surge in health awareness among Chinese consumers,” said Kenneth Chow, director at Oliver Wyman.

Even for people in their early 20s, health comes second to plans to spend more on food, the survey found. The study ranked the categories based on the percentage of respondents who said they would spend more on each item, minus the percentage who said they would spend less.

The pandemic put pressure on hospitals around the world. But China’s situation — particularly since December’s spike in Covid cases — revealed the gulf between the local public health system and the country’s global economic clout, second only to the US

According to the World Bank, the U.S. ranks first in the world in per capita healthcare spending at $10,921 in 2019. For China, the same figure was $535, similar to Mexico.

Households in China also pay for a higher proportion of their healthcare — 35.2% versus 11.3% for Americans, World Bank data showed.

Extreme pressure on public hospitals — including lack of capacity — has pushed many new patients for Covid and non-Covid treatment at facilities operated by United Family Healthcare in China, said founder Roberta Lipson. She said her company has 11 international-standard hospitals and more than 20 clinics in major Chinese cities.

“Growing awareness of the importance of secure access to health care and of UFH as an alternative provider is leading to increased demand for our services from patients who can afford self-pay care,” she said.

“This experience is also driving interest in commercial health insurance, which could cover access to private premium providers,” Lipson said. “We’re helping patients understand the benefits of commercial insurance. This will have a profound impact on the volume of demand for personal healthcare.”

New Frontier Health, of which Lipson is vice chairman, acquired United Family Healthcare from TPG in 2019.

In early December, mainland China abruptly ended its strict Covid contact tracing measures. Official data showed that infections were rising sharply, with hospitalizations hitting a peak of 1.6 million nationwide on January 5.

Between December 8 and January 12, Chinese hospitals recorded nearly 60,000 Covid-related deaths – mostly seniors, according to Chinese health officials. As of Jan. 23, the total exceeded 74,000, according to CNBC estimates from official data.

Although new deaths per day have fallen sharply from the peak, the figures do not include Covid patients who may have died at home. Anecdotes describe a public health system overwhelmed with people at the peak of the wave and long waits for ambulances. Doctors and nurses worked overtime in hospitals, sometimes while they were sick themselves.

Health insurance

Most of China’s 1.4 billion people have so-called social health insurance, which provides access to public hospitals and reimbursement for medicines that are on a government-approved list. Both employers and their employees make regular payments to the state system.

Penetration of other health plans — including commercial plans — was just 0.8% in the third quarter of 2022, according to S&P Global Ratings.

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Analyst WenWen Chen expects commercial health insurance to grow rapidly this year and next. “After Covid, we see that people are becoming more risk-aware [health insurance] Agents find it easier to pick up conversations with customers.”

Chinese health insurance industry players include ping on, PICC And AIA. Local authorities are also testing a low-cost insurance product called Huimin Bao.

Oliver Wyman’s December survey found that 62% of non-policyholders plan to purchase health insurance and 44% of existing policyholders are considering increasing their coverage.

Over the past 15 years, the Chinese government has dedicated financial and political resources to the development of the country’s public health system. The subject was an entire section of Chinese President Xi Jinping’s report to a major political meeting in October.

hospital financing

However, one of the obstacles to improving China’s public health system is its fragmented funding system, according to Qingyue Meng, executive director of Peking University’s China Center for Health Development Studies.

Health care providers in China receive funding from four sources — social health insurance, the state health budget, basic public health programs and out-of-pocket payments — each “managed by different agencies without effective coordination in budget management and allocation,” Meng wrote in The Lancet in December.

“Hospitals and clinics are reluctant to offer public health care due to the lack of financial incentives and the important number of regulations that are more divergent,” he said[s] hospitals and [specialized public health organizations such as the Centers for Disease Prevention and Control].”

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For comparison, HCA healthcare, the largest hospital operator in the US, said more than half of its revenue comes from managed care — often corporate-subsidized plans with a network of healthcare providers — and other insurers. Most of HCA’s other revenue comes from Medicare and Medicaid state-related health insurance plans.

In China, United Family Healthcare’s Lipson claimed that as a privately held company, it could respond more quickly. “We fund our own growth and can acquire talent and expertise by offering competitive compensation packages, so we can also customize beds to the level of care required.”

“After observing the course of pandemic waves in other countries and our patients being paid privately, we were able to order sufficient stocks of medicines, PPE, etc. when we started to see the number of Covid cases increasing in China,” said called her.

Her company had excess capacity early in the pandemic, having opened four hospitals in the past two years, Lipson said, noting that the public system had added 80,000 intensive care unit beds in the past three years but was struggling to fill demand to cover the increase in Covid cases.

lack of specialists

Ultimately, the shock of the pandemic presents an opportunity for broader industry changes.

The healthcare payment system has no direct impact on China’s hospitals, as most are under direct government supervision, said George Jiang, consulting director at Frost&Sullivan.

But he said macro events could drive necessary systemic changes, such as B. Triple the capacity of the intensive care unit in one month.

China’s tiered medical system has forced doctors to compete for some advanced ICUs only in the largest cities, leading to shortages of qualified ICU doctors and beds, Jiang said. He said the recent changes mean smaller cities now have the capacity to hire such specialized doctors – a situation not seen in China in the past 15 years.

Now with more ICU beds, he expects China will need to train more doctors to this level of care.

There are many other factors behind the development of healthcare in China and why local people often go abroad for medical treatment.

However, Jiang noted that increased use of the internet for payments and other services in China compared to the US means the Asian country has the potential to become the most advanced medical digitization market.

Chinese companies already active in this space include JD Health and WeDoctor.

— CNBC’s Dan Mangan contributed to this report.

Correction: This story has been updated to reflect that Roberta Lipson is the Founder of United Family Healthcare and Vice Chair of parent company New Frontier Health.

Hispanic dialysis patients are at a 40% higher risk of developing a staph infection compared to whites, according to new data released Monday by the Centers for Disease Control and Prevention, underscoring the economic and racial disparities in the U.S. healthcare system.

Adults who are on dialysis for kidney failure were 100 times more likely to get staph infections compared to the general US population, according to the CDC. Needles and catheters are used to connect patients to dialysis, and bacteria such as staph can enter a patient’s bloodstream during the process. Staph infections are serious and sometimes fatal.

“Overall, it is believed that the second leading cause of death in dialysis patients is infection — all infections, not just bloodstream infections,” said Dr. Shannon Novosad, head of the CDC’s dialysis safety team, told reporters during a call Monday. “They are also one of the leading causes of hospitalization for these patients.”

According to the CDC, more than 800,000 people in the US are living with kidney failure, 70% of whom require dialysis.

However, people of color are at an even higher risk of kidney failure, which accounts for more than half of dialysis patients. According to CDC data, the rate of kidney failure is four times higher in blacks and twice higher in Hispanics than whites. Blacks make up 33% of all dialysis patients in the US.

Black and Hispanic dialysis patients were also more likely to get staph infections than white patients, the CDC said. The data analyzing dialysis patients from 2017 to 2020 did not conclusively calculate the increased risk for black patients. However, Hispanic patients were at a 40% higher risk of staph infection than whites, according to the CDC.

The CDC said in a statement that the unadjusted rate of staph bloodstream infections was 23% higher in black patients than white patients, but when adjusted for other factors, they were not at greater risk.

“It’s still important to highlight these increased rates because staph infections are more common among black dialysis patients, but there are other factors contributing to these increased rates outside of race alone,” CDC spokeswoman Martha Sharan said.

According to Novosad, more dialysis patients with staph infections lived in areas with higher poverty, more households and lower educational levels. About 42% of staph infections in dialysis patients occurred in areas with the highest poverty, she said.

The CDC study examined data from select counties in seven states from 2017 to 2020. The states are California, Connecticut, Georgia, Maryland, New York, Tennessee and Minnesota.

Bloodstream infections in dialysis patients decreased 40% from 2014 to 2019, according to the CDC, due to staff and patient education on prevention. Using fistulas and grafts to connect a patient’s bloodstream to the dialysis machine reduces the risk of infection compared to catheters.

“Prevention of staph infections begins with recognizing chronic kidney disease in its early stages to prevent or delay the need for dialysis,” said CDC Chief Medical Officer Dr. Debra Houry.

The Director-General of the World Health Organization (WHO), Dr. Tedros Adhanom Ghebreyesus, attends an ACANU briefing on global health issues including COVID-19 pandemic and war in Ukraine on December 14, 2022 in Geneva, Switzerland.

Denis Balibouse | Reuters

The World Health Organization said Monday Covid-19 remains a global health emergency as the world enters the fourth year of the pandemic.

But WHO Director-General Tedros Adhanom Ghebreyesus said he was confident the world would emerge from the emergency phase of the pandemic this year.

“We remain hopeful that in the coming year the world will move into a new phase where we reduce hospital admissions and deaths to the lowest possible levels and where health systems are able to manage Covid-19 in an integrated and sustainable way,” said Tedros said in a statement.

The WHO Emergency Committee met on Friday and told Tedros that the virus, which was originally detected in Wuhan, China, in late 2019, remains a public health emergency of international concern, the UN agency’s highest alert level. The WHO first declared an emergency in January 2020.

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The WHO decision comes after the US extended its public health emergency until April earlier this month.

In its statement on Monday, Tedros said the world is in a far better place than it was a year ago when the Omicron variant first swept the globe. The WHO has estimated that at least 90% of the world’s population has some level of immunity to Covid as a result of vaccination or infection.

Weekly Covid deaths have fallen by 70% since the peak of the first massive Omicron wave in February last year, according to WHO data. But deaths picked up again in December as China, the world’s most populous country, faced its biggest wave of infections yet.

Tedros said on Friday surveillance and genetic sequencing have fallen dramatically, making it difficult to track Covid variants and detect new ones. Too few older people are fully vaccinated and many people don’t have access to antivirals, he said.

“Don’t underestimate this virus,” Tedros told reporters at a news conference in Geneva on Friday. “It surprised us and will continue to do so, and it will continue to kill if we don’t do more to provide health tools to people who need them and to comprehensively combat misinformation.”

Last month, the WHO chief said the end of the emergency phase of the pandemic was closer than ever. In the fall, Tedros said the end of the pandemic was in sight.

“We have never been in a better position to end the pandemic. We’re not there yet, but the end is in sight,” Tedros told reporters in Geneva last September.

U.S. President Joe Biden delivers remarks regarding the coronavirus disease (COVID-19) before receiving a second COVID-19 booster shot in the South Court Auditorium of the Eisenhower Executive Office Building at the White House on March 30, 2022 in Washington, United States.

Kevin Lamarque | Reuters

The Biden administration plans to end the Covid public health emergency this spring as the US moves away from responding to the pandemic as a national crisis and instead treats the virus more like a seasonal respiratory illness.

The White House said in a statement Monday it will end public health and national emergencies on May 11, which the Trump administration first declared in 2020.

The statement, issued by the Office of Management and Budget, expressed the White House’s strong opposition to House Republican legislation aimed at immediately ending emergency declarations.

Public health and national emergencies have allowed hospitals and other healthcare providers to respond more flexibly when faced with spikes in patient traffic during Covid outbreaks.

Enrollment in Medicaid has also surged because Congress basically barred states from withdrawing people from the program, citing the public health emergency.

A provision in federal spending legislation passed in December allows states to begin withdrawing people from Medicaid in April.

Although the emergency declarations will remain in effect through the spring, the federal response to the pandemic has already been scaled back as funding has dried up. Congress failed for months to pass a White House request for $22.5 billion in additional funding for the Covid response.

The Department of Health has promised to give states 60 days’ notice before the emergency ends, giving the health care system time to prepare for a return to normal.

The public health emergency has been extended every 90 days since January 2020 as the virus has evolved into new variants and repeatedly thrown curveballs over the past three years. HHS extended the emergency earlier this month.

The OMB said an abrupt end to emergencies in the manner established by Republican legislation would “create widespread chaos and uncertainty throughout the health care system.”

Ending the statements without giving hospitals time to adjust would result in “disruptions in care and delays in payments, and many facilities across the country will experience lost revenue,” according to the OMB statement.

It would also “sow confusion and chaos” in the process of processing Medicaid coverage, OMB said.

The White House also plans to bring the Covid vaccines to the private market in the near future, although the exact timing is unclear. That means the cost of the vaccines would be borne by patients’ insurance policies, not the federal government.

Moderna and Pfizer have both announced they can charge up to $130 per vaccine dose, four times what the federal government pays.

Covid has killed more than 1 million people in the US since 2020. Deaths have fallen dramatically since the pandemic peaked in winter 2021, but nearly 4,000 people still succumb to the virus each week.