Privatization of Healthcare Services Dissertation

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[. . .] With this reality check and overall change in approach permissions were granted to individuals for setting up and running private hospitals with government regulations. This revived the private sector and many public institutions were privatized over night. Both types of institutions private and public still co-exist in China but number of private hospitals and clinics remain far greater. In most cities the private hospitals and clinics privatized at an incredible speed going from 40% of all institutions in 1998 to 56% private institutions in 2005, this rapid privatization led to establishment of un-registered private entities (Black Clinics). Earlier to 1980 there were four groups who were allowed to setup and run private practice; First group was individual practitioners with a license prior to the Cultural Revolution, Second group was medical personnel who were laid off by public institutions, third group was composed of family trained practitioners who used traditional Chinese methodologies and fourth were retired practitioners also using traditional methods. Out of these four only three groups were then allowed to practice privately after 1980 health reform hence many practitioners about one third of them were unlicensed involved in bogus activities. With time new practitioners passed out from medical schools but were not employed by already shrinking public healthcare sector hence they joined private sector and led to further development of the sector. Although most technologically advanced institutions are still government owned with most competent workforce and state of the art facilities. Generally private practice is started by those who are not employed by public sector, similarly patients who do not have formal medical insurance and have no access to costly public medical service. The transformation from public financing to private financing increased cost and led to inequality in health services. The possession of wealth became a critical factor in getting access to quality services leading to limited access for poor families, who would only go to private practitioners due to cheaper costs (Lim Meng-Kin et al., 2004b).

During the past thirty years the rapid development of private practice shows that government failed to provide an equitable and universal healthcare system to Chinese people at large. Although public sector still plays a major part in providing healthcare with private entities only playing a complimentary role and is still limited to constraints such as cure to serious illnesses. Doctors working in public institutions were not allowed to open their own private clinic and were labeled as illegal but the new healthcare reform published in 2009 encourages qualified doctors to set up and run their own private clinics. The culture and tradition of private clinics in China with economy driven favorable government regulations pave the way for an encourage future for private clinics.

Figure 2

: Three Layered Healthcare SystemChina provides public healthcare to its citizens in three layers for both rural and urban areas. In urban areas the three layers are composed of neighborhood health stations (clinics), district hospitals and municipal hospitals, while rural structure is composed of village health stations, township health centers (hospitals) and county hospitals. The upper levels in both layers provide both inpatient and outpatient with emergency services while lower level, neighborhood and village stations provide basic or preventive health care services (Hassan H. Dib et al., 2009).

In reality most basic healthcare institutions at mid and lower levels are privatized especially in towns and small cities. This private sector is composed of both private hospitals and clinics; they occupy the same level, are easily accessible and provide similar services of curing minor chronic diseases for all patients especially poor patients. Hence with time they have replaced the public institutions on lower levels. (See Figure 2)

When experiencing symptoms a patient usually contacts the lower level, either community or village health station, if the illness is outside the scope then the patient is referred to the next level of health institution.

Research shows that there are various problems with this three layered system; mainly with its vertical structure. The accessibility to upper level hospitals means long waiting lists for registration and treatment, tests, fee and medicines; limited attention from the doctor and high costs for medicine. The problems also extend to lower levels and are mainly related to expertise, insufficient skills, shortage of medical equipments and poor facilities.

There are many critics that condemn private clinics due to poor quality and patient safety but research shoes that competent and qualified private practitioners in private clinics are not sub-standard to their public counterparts. In fact masses believe that private practitioners are seen as better than public counterparts especially in relation to individual attention, extended courtesy and great customer service standards. A survey conducted in Guangzhou, the capital and largest city of the Guangdong province presents that 79% of the subjects gave positive response to private clinics and attitude demonstrated by private doctors. In addition to a positive attitude exhibited by doctors there is the element of competition and an advantage held by private clinics when it comes to providing cure and medicines to specialized illnesses that use traditional Chinese methods and medicines. These illnesses include bone-setting, maternal care amongst other rare diseases in which public institutions are not specialized and competent. From this survey it can be observed that private clinics do not only complement the public sector in sharing the burden of overwhelming number of patients but also provide care for illnesses not covered by modern public healthcare institutions (Hassan H. Dib et al., 2009).

The public healthcare sector is much deteriorated in rural areas where community healthcare centers are not prepared sufficiently for meeting needs of the masses hence most patients crowd the upper level hospitals overwhelming them in cities and hence easy access for both populations becomes impossible. The demand of healthcare services is not met by public sector and hence many people opt for cheaper alternatives, in the shape of private clinics and practitioners.

These Private clinics can play a pivotal part in enhancing the overall delivery of prevailing health system in China. An independent survey shows that 31% patients in rural areas used private clinics, another 30% used village health centers, 22% used township health stations and only about 3% used city hospitals. In urban localities also patients prefer using cost effective means with 49% going to private clinics. Most patients preferred to stay away from Upper level hospitals due to high cost and time consumption. The more accessible and cost efficient private clinics improve the provisions of healthcare services to general masses.

Privatizing healthcare sector means the withdrawal of government management while non-government bodies take up the role of financing and providing health services. Privatization can generally be done by using three approaches; complete termination of public responsibilities (termination), contracting out public responsibilities (contracting out) and independent performance of public responsibilities (self-governance). Termination means that state's span of control is reduced and responsibilities are given to private bodies, while contracting out means that state's span of control and responsibilities remain intact only certain works are contracted out to complete the public tasks. In self-governance scope remains the same and with public bodies but extensive autonomy is given to the bodies (Gill & Ghuman, 2000).

China too experienced this change when it transformed its controlled economy into a market economy, resulting in healthcare sector reforms. It underwent rapid healthcare privatization in the last three decades. (Limmang -- Kin, 2004)

Chinese people refer to the term privatization as si ying hua. Before 1979 privatization was considered as an evil and a phenomenon against the socialism, it was considered as selfish act, an acceptance of western ways of capitalism and abolition of state responsibility. While in western world it was looked as a freedom given to external bodies for increasing effectiveness and efficiency. Because of this ideology of China, privatization phenomenon took time for acceptance. Earlier to 1979 China had a central but an extensive healthcare system through which healthcare services were thought to be provided to all with a low cost. After 1979 private practitioners became acceptable with acute shortage of public healthcare services in early 1980s. Even after these three decades of public control, the healthcare sector remained sub-standard with inferior technology and obsolete medicine and methods with healthcare sector having no economic value. This transformation was forced by more important factors; factors such as huge budgets devoted by state for providing public healthcare facilities, something they could not afford in longer run. Additionally the demography of China was changing with increasing population and more senior citizens; this also led to increase in demands and the need to widen the spread and include peasants in to healthcare provisions. All of these led to enormous spending on healthcare with the demand of various new services from the consumers with steady evolution in medical field. (Limmang -- Kin, 2004)

The requirements of masses were many and the task of fulfilling these requirements by government or public healthcare only proved… [END OF PREVIEW]

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Privatization of Healthcare Services.  (2012, September 22).  Retrieved December 13, 2019, from https://www.essaytown.com/subjects/paper/privatization-healthcare-services/4425259

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