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The anxious Chinese woman wanted to ensure that her mother would receive the best care during her upcoming gall-bladder surgery. So the woman, surnamed Cheng, cornered the dean of surgery at a hospital in eastern China’s Anhui province and pressed an envelope in the doctor’s hands. Inside the hongbao — or “red packet,” as such cash bequests are known in China — was 1,000 yuan, or around $160. The doctor took the envelope without questions. “Everybody does this,” Cheng recalls. “If you don’t give a hongbao, you’ll stand out.”

China’s medical system has to treat the world’s largest national population, a massive cohort that is rapidly aging. The illnesses that plague Chinese patients are shifting from life-threatening third-world ailments that can be treated relatively cheaply to the more complex and chronic infirmities of economically developed societies. It’s a daunting task — and an expensive one. Since China’s transition from a completely socialist model, medical bills have become one of the most common factors sending Chinese into poverty. That’s because hospitals have had their government funding slashed, forcing clinics to pass the cost burden to patients. In recent years, the central government has rolled out public health coverage to increase access to affordable care.

These reforms notwithstanding, China’s medical system is still deeply diseased, riddled by corruption that impedes efficient care-giving and sends costs skyrocketing for patients. Beyond the proliferation of hongbao, hospitals recommend unnecessary but expensive tests and procedures to keep afloat departments now starved of public money. Extra fees for ambiguous items often end up on medical bills. Medical manufacturers and drug companies are also complicit, handing out cash to health workers in exchange for their products being used in hospitals.

China’s corrupt health care sector was exposed last month when foreign pharmaceutical giant GlaxoSmithKline was accused by government regulators of bribery and over-charging for its drugs. GSK staff in China have been detained and implicated in allegedly channeling up to $490 million through conduits to physicians and other medical staff to prescribe their drugs at inflated prices. In a statement GSK admitted that “certain senior executives…appear to have acted outside of our processes and controls which breaches Chinese law.” Other Western pharmaceutical companies are now being probed by government investigators, although these firms’ representatives maintain the inquiries are routine. Whatever the outcome, the fact remains that China’s doctors and clinics are woefully underfunded, leaving ample space for the kind of bribery that is poisoning the country’s health care system. More at: http://world.time.com/2013/08/02/corruption-blights-chinas-healthcare-
system/#ixzz2ap81grQk

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