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Chinese Hospitals to Be Divided into Commercial and Non-profit
China's public health authorities have given the green light to commercial hospitals as part of the country's new medical care system, which is undergoing drastic reform.
Hospitals should be separated into two categories - commercial and non-profit - to satisfy the varying demands for medical services, an official with the Ministry of Health said Thursday.
Non-profit hospitals are mainly run by local governments, enterprises, communities and non-governmental organizations, and should guarantee basic medical care for the public, putting any profits into improving medical equipment and introducing new technology. These hospitals enjoy preferential tax treatment and financial allocations.
Commercial hospitals will have the freedom to decide their own fees, but will have to pay taxes according to regulations, said Wu Mingjiang, director of the MOH's Department of Medical Administration.
Hospitals have long been considered public benefit institutions in China because they were funded by the government as a part of the welfare system.
However, privately owned, joint-stock, and foreign joint- venture hospitals have been burgeoning in recent years, though they still make up only a tiny percentage of the country's 16,600 hospitals.
Public health specialists believe that this new system may help improve the quality of hospital services since competition would be prompted.
"The goal of the reform is to provide affordable, fair, and quality health care service to the people. I believe that most patients can be benefited from the reform," Wu said.
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