Since the outbreak of the COVID-19 pandemic, numerous hospitals in China have gone bankrupt and closed down. Public hospitals on the mainland are in need of government funding and a move towards more market-oriented operations. Analysts point out that with a declining population, the sources of funding for medical insurance are becoming scarcer. As the operational pressures on hospitals increase, the issue of expensive medical treatment for the public is becoming more prominent.
According to reports from the medical industry media “Medical Observation,” Vice President Yu Xiaobao of the Private Hospitals Management Branch of the Chinese Hospital Association has indicated that since the outbreak of the pandemic, over 2,000 private hospitals in China have faced bankruptcy due to operational difficulties.
This number is still on the rise. In an article published on January 5 by “Sanlian Life Weekly” on its WeChat account, records related to hospital bankruptcies in 2024 exceeded 1,200, compared to just over 800 in 2023 and 500 in 2022. This indicates a significant and rapid increase in the number of hospitals going bankrupt in 2024.
In 2024, news of hospital bankruptcies surfaced in various parts of China, with a focus on small and medium-sized private hospitals.
By searching the National Enterprise Bankruptcy and Reorganization Case Information Website with “hospital” as the keyword for public announcements from January 1 to December 20, 2024, a total of 591 cases were found, including bankruptcy review cases, bankruptcy cases, compulsory liquidation application review cases, and compulsory liquidation cases. Among these cases, many involve private hospitals:
– In January, Changsha Zhen’an Hospital Co., Ltd. entered bankruptcy liquidation process.
– In February, Bengbu Transport Hospital went bankrupt.
– In March, Beijing Taihe Maternity Hospital Co., Ltd. was officially declared bankrupt.
– In April, Guangdong Yunfu Intermediate People’s Court ruled the bankruptcy of Luoding City Wei Ren Hospital Co., Ltd.
– In May, Shijiazhuang Modern Traditional Chinese Medicine Blood and Kidney Disease Hospital was declared bankrupt.
– In July, Capital Orthopedic Hospital Co., Ltd. was declared bankrupt.
– In August, Wuhu Jinghu District People’s Court declared bankruptcy of Wuhu Elizabeth Maternity Hospital.
– In October, Sichuan Huapu Hospital Co., Ltd. issued a recruitment notice for bankruptcy restructuring investors.
– In November, Chenzhou Jindun Hospital was declared bankrupt.
– In December, Yangjiang Angie Maternity Hospital in Guangdong Province officially announced bankruptcy and closure due to poor management.
Comparing data from previous years reveals a trend of a significant increase in the closure and bankruptcy of private hospitals:
– In the first 11 months of 2021, there were 160 publicized hospital bankruptcy cases.
– In the first 11 months of 2022, there were 252 publicized hospital bankruptcy cases.
– In the first 11 months of 2023, the number of publicized hospital bankruptcy cases surged to 460.
– In the first 11 months of 2024, a staggering 528 hospital bankruptcy cases were publicized.
According to the “China Health and Health Statistics Yearbook,” a total of 23,500 non-public medical institutions nationwide reported a combined loss of 130 billion yuan in 2021, with an average loss of 5.53 million yuan per institution. By 2023, this situation further deteriorated, leading to the forced closure of many small private hospitals and outpatient facilities with fewer beds.
Renowned medical observer Liu Yan has expressed that currently, less than 5% of private hospitals in China are actually profitable, around 20-30% are deeply troubled, and over half are facing tremendous survival pressure.
Chinese public welfare institutions are divided into two categories: public welfare category one, funded entirely by government allocations, and public welfare category two, funded by both government allocations and market-oriented business operations. Public hospitals fall under the second category, requiring government funding while also seeking profits in the market.
Recent reports from mainland media highlight that with a declining population, the sources of funding for medical insurance will continue to diminish. Medical insurance funds are crucial income sources for public hospitals, and if the medical insurance sector contracts, public hospitals will face increasing revenue pressures and may pass on these pressures to patients. This could mean that the issue of expensive medical treatment becomes even more pronounced for ordinary citizens.