Growing financial strain leads to salary cuts, debt burden in China's healthcare system
New Delhi, Oct 29
China's healthcare system is facing mounting financial pressures, evident by rising hospital debt burdens, delayed wage payments, salary reductions and growing public dissatisfaction, a report has said.
The report from Myanmar-based Ayeyarwady Times said that hospitals across several provinces have reported delayed salaries, reduced bonuses, staff cuts and, in some cases, complete suspension of operations.
The Chinese Communist Party (CCP) has for decades projected its healthcare system as a symbol of state capacity and social stability, yet the sector, even public hospitals, once considered among the safest institutions in the country is under severe strain, the report said.
Public hospitals are suffering from declining revenues after years of aggressive expansion along with reduction in traditional income streams, primarily due to policy failures and entrenched corruption.
During China's period of rapid economic growth, many hospitals invested aggressively in new facilities and medical equipment, often financed through borrowing. Public hospital debt nearly quadrupled between 2011 and 2021, while slower economic growth, declining local government revenues and property market weakness added to the stress.
Accountability about project viability often took a back seat to bureaucratic targets. "Local officials were incentivised to pursue visible infrastructure projects rather than long-term sustainability," the report said.
"China's healthcare sector has long faced allegations of corruption involving government officials, hospital administrators, pharmaceutical companies and procurement networks," it added.
Corruption embedded at the top, inevitably trickled down through the bureaucracy as senior officials manipulated procurement contracts and hospital administrators pursued prestige projects. Mid-level managers prioritised political loyalty over efficient governance to secure promotions in their career.
Studies showed that population aging is placing enormous pressure on the financial sustainability of China's social health insurance funds. China's medical insurance system is under threat as the number of working-age contributors grows very slowly.
— IANS
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