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Hospitals Criticized for Putting Profits First

The Ministry of Health published a lengthy report yesterday that had been issued by the health minister on July 1 criticizing "some medical institutions" for putting profits before public interests.

Gao Qiang's report said the mismanagement of a large number of institutions is to blame, preventing many people from accessing adequate and appropriate healthcare.
"Medical institutions have been over-commercialized, relying chiefly on exorbitant charges for their maintenance and development," he acknowledged. "The goal for future medical reform will focus more on public interest and affordability of medical services for all."

In mid-June, a State Council research center produced a report admitting that medical reforms of the past decades had been a "failure," and the Ministry of Health responded that it would draft a new reform plan in collaboration with other departments.

According to the ministry, hospitals have maintained double digit income growth rates while receiving fewer patients each year. Public expenditure on medical bills has grown faster than people's incomes in the past eight years.
With 4.7 percent fewer patients going to hospitals managed by health departments in 2003 than in 2000, institutions still recorded 69.9 percent growth in profits. Of this, 49.8 percent was from medical treatment and 38.7 percent from drug sales, with less than 10 percent from government funding.
"Putting profit ahead of other functions not only adds the burden for patients, but seriously undermines the image of both medical personnel and public health departments," said Gao.
He also suggested instituting a public health mechanism in which state government should play a bigger part in guiding hospitals in working for the general public's welfare.
Since the late 1970s and early 1980s, central government has reduced funding to public health institutions.
Of 659.8 billion yuan (US$81 billion) total medical expenses in 2003, 56 percent was paid by individual patients and only 17 percent by government.
"Patients' medical bills have been used to cover almost everything: drug costs, wages and subsidies of medical personnel, doctors and nurses, new medical equipment and hospital facilities," Gao said, adding that "We are in need of specially-designated authorities to enhance the supervision of public hospitals."

(Xinhua News Agency August 5, 2005)

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