2016-08-09

Chinese Insurance Companies Salivating At Chance to Implement US Healthcare System

The lead in this Economic Observer article on health insurance:
Although the health insurance market annual growth rate of 40%, but mostly at a loss. Why are health insurance companies eager to enter the market?
This conference, Qinghai Provincial Party Committee deputy secretary-general, provincial health reform office director Hou Pengning that year to comprehensively implement the basic medical insurance of commercial insurance services in the province. The precise manner in the basic medical insurance, handling, audits, claims and other content all by commercial insurance companies operate.

Qinghai initiatives still national precedent.

The move to the National Health and Family Planning Commission announced the launch mode, the industry has been interpreted as "management departments interested in promoting commercial insurance process."

The industry believes that the pilot Qinghai, if successful, will have a significant impact on the basic health care system, and even insiders bold assumptions, China's future payment or security system will be similar to the United States, the basic medical insurance holding less than 30%, the remaining 70 % of all commercial insurance. "This market space is very large, the first to enter, who will have more say in the future," Xu speed Shanghai Medical Reform Office, deputy director, said, "With the deepening medical reform, and now to the commercial insurance into the basic medical service market golden moment. "

Insurance market forecast and the medical profession is that by 2020 the national health insurance market space will reach 2 trillion yuan of scale. Last year, the national health insurance market size between 150 billion yuan to 160 billion yuan this year, nearly 200 billion yuan.
The U.S. market is a disaster because of third-party payments, demographics, and a lack of actual insurance. In China, health insurance still tends to be more like actual insurance. You can get catastrophic coverage in China and unless you're going to die, the insurance company doesn't pay out. Things like broken legs, kidney stones, probably a stab wound if it hit nothing vital. Whereas in the U.S., the medical industry and government are in cahoots to drive up spending.
It is reported that recently received professional health insurance licenses of three companies, namely Fosun UnitedHealth Group, a subsidiary of Tencent Senate vote and Beijing and the Thai Life Insurance industrial park led love life.

Starting in 2014, keen sense of smell began to get involved in professional health insurance market, Fosun is just one of them. According to the insurance industry sources, the current submission CIRC hopes to establish a professional health insurance company's application for a license has more than 50 sheets. However, the CIRC sources said, may eventually not issue so many licenses, but the market boom is set off.

Currently, most insurance companies for property insurance business in China, life insurance, pension insurance, and only 5 for professional health insurance company. This five professional health insurance companies are: PICC, Kunlun, harmony, peace, CPIC and the Allianz insurance company. China's insurance market share, a company specializing in health insurance services accounted for only 10%, and the remaining 90% comes from property insurance and life insurance.

In those now actively applying for a license of professional health insurance companies, the biggest bright spot is a cross-industry alliance are frequent, such as software and entrepreneurial spirit Kang Pharmaceutical, Sunshine Insurance Group and a combination of Neusoft. Insurance industry analysis, this pattern will lead to the birth in China as a large insurance group company.

This upsurge is reminiscent of the evolution of the US insurance market, and the brightest of capital eager to see the outside world seems to be the prototype of United Health Group.

United Health Group, founded in 1974, is located in Minnesota's Min-netonka, UnitedHealthcare and Optum is divided into two business segments. Optum as an extension of insurance, mainly by health management companies (OptumHealth), health information technology services company (OptumInsight) and pharmacy benefit management companies (OptumRX) three subsidiaries.
There's a risk that China could follow in America's disastrous footsteps given how the insurers want to see the market develop:
However, the current national health insurance situation, although the health insurance market, with 40% annual growth rate, but mostly at a loss. According to industry people said, Ping Pong and have failed to achieve profitability in this area.

So why are companies eager to enter the health insurance market?

Taikang Life Insurance, a person on the Economic Observer said: "Because the industry is expected to China in 2020, health insurance premiums will quickly heavy volume, will scale to 2 trillion yuan."

The industry brought the underlying market is still the United States, in this market, only 30% of the basic medical insurance covered veterans and poor people. The remaining 70% are commercial insurance. The current situation in China and the United States is just the opposite. "But we expect the future of China's basic medical insurance will not exceed 30%, 70% will be converted to commercial health insurance forms. So the future is definitely the number one trillion space." An insurance source said.

This market space is a huge temptation. The US insurance company's operations and profit model like a carrot in front of a goat, and stimulate the imagination of Chinese industry's largest. "Chinese health insurance premiums currently only 8% of the total, while the US is 40% the size of the US health insurance premium of 1.68 million dollars, the German health insurance premium per capita has more than $ 3,000, and we only 116 dollars per capita level of last year's national health the total cost of more than 4 trillion, but the insurance claim amount of 500 million, while financing the health industry is also low, "Xu speed deputy director of Shanghai Medical reform Office believes that" our future development potential is enormous. "
Some analysts think the American-style system isn't coming to China though:
However, the future of the country in the end can occur several professional health insurers are not yet known. Industry sources also pour cold water on the enthusiasm of all kinds of capital that China will eventually not take the American model, although this stage of development the United States there are some similarities, the Chinese government will reference the American model, but because of the way policymakers pay Unlike the United States, so the future may be in macro-economic control led to the semi-market-oriented approach to promotion execution.
EO: 中国医疗保障体系将迎来巨变 !50多家机构等待健康险牌照

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