Xiao Huaqing, a pediatrician at the People’s Hospital of Yiyang County, Henan Province in central China, now follows standardized clinical protocols to treat his patients.
Called a “clinical pathway”, it is literally a computerized checklist that serves as a roadmap for both caregivers and patients throughout their treatment. It lists everything from what tests a patient can expect before surgery to how soon he or she should be discharged from hospital and most importantly, how much each treatment would cost.
Flexibility is built into the clinical pathways, still giving doctors discretion over elective services based on different patients’ condition. But case payment is fixed, regardless of whether electives services have been provided.
“It has curbed overtreatment and reduced patient out-of-pocket spending,” said Dr. Xiao.
Yao Xinglian, a villager in Yiyang County, brought her one-year-old son to the hospital for a cure of his bronchitis. When she was checking her son into the People’s Hospital of Yiyang County, she was informed that her son would be treated via Clinical Pathway A, used for not- so-serious condition of bronchitis. The total cost would be RMB 620 (US$100). And she could pay after her son recovers. It was a big change from the past.
“Before we had to pay a deposit before hospitalization and had no idea how big a bill we’d get when we were about to leave hospital,” she said. “But now we know exactly how much we’ll need to pay even before being hospitalized and can also make payment later.”
In 2009, the Chinese government launched healthcare reforms to fix a dysfunctional system that was plagued by high costs and poor quality of care. A serious problem back then was over-prescription and over-treatment.
Hospitals were allowed to charge a 15% mark-up on the price of medicines, which induced physicians to prescribe more drugs and to choose more expensive ones. Besides, a fee for service system, in which hospitals were reimbursed for each service they provided, regardless of the quality of care, encouraged doctors to perform unnecessary tests and treatments.
To address such problems, Henan Province is undertaking a comprehensive hospital reform in rural public hospitals, with support from the World Bank/DFID-funded Rural Health Project.
The reform includes adoption of computerized clinical pathways, a shift from fee-for service to case-based payment, performance-based payment for care providers, and IT based monitoring on service quality of healthcare facilities.
Unnecessary services for clinical-pathway patients were slashed, saving money for both the patients and their insurers.
Since the reform began in 2009, the People’s Hospital of Yiyang County, for example, has seen patients’ hospital stays reduced by over a full day while their medical expenses decreased by 5-8 percent. But in the meantime, the hospital’s revenues increased 8.7 percent since improved health services drew more patients.