Cancer Statistics
Cancer is generally considered a problem of the developed world. In fact, of the 10,000,000 new cancer cases each year, nearly 5,500,000 occur in the less developed countries. Cancer risk factors are highest among the least educated and their survival rates are the lowest.

Cancer rates in China soared 41.48% from 1990 to 2000 and is expected to increase nearly 28% from 2000 to 2010 due to the high rates of tobacco usage, environmental conditions, and an aging population whose life expectancy has nearly doubled to 71.1 since 1949. Lung cancer is the most prevalent, with rates much higher than the total general cancer rates. Lung cancer rose 61.29% between 1990 and 2000, and a 51.38% increase is projected from 2000 to 2010. W.H.O. statistics list China's adult male smokers at 67%, the highest in the world, with the exception of Mongolia's 68%. Liver and stomach cancer are the next highest types, with breast and cervix cancer dominant among women. Survival rates for lung, liver, and stomach cancer are a low 15% according to W.H.O. reports.

Mortality rates from cancer in the 1990s were 94.36 per 100,000 population, nearly 18%, up from 84.58 per l00,000 or 12% in the late 1970's. Approximately 74% of all cancer related deaths were due to lung, liver, stomach, colorectal, and esophageal cancers (in order of mortality rates). The mortality rate for lung cancer increased 111%, with significant percentage increases in breast cancer as well. Urban center mortality rates are higher, having increased 22%. Shanghai cancer mortality rates at 212.17 per l00,000 accounts for 29.22% of total deaths are yet higher, even though it is the locale of some of the most sophisticated medical care facilities in China. In 2003 of 43,000 cancer patients 
in Shanghai, a total of 34,000 died.

Health Care Overview
China's cradle to the grave free health care system providing more than 85% of the population with some form of health care between 1949 and 1975 unraveled during the economic reforms in the 70s and its push to become a market economy -- with the rural population being most affected by this down turn. In 1981, 71% of the population had access to state health facilities. In 1993 only 21% was consuming 80% of China's medical resources. Yet, statistics show the demand for health services has grown 16% in the last ten years, placing enormous pressures on an already overburdened system where China's per capita health care expenditures from 1997 - 2000 is less than that of Swaziland in Africa.

The Central Government recognizes the need for sweeping reforms of its health care system to provide better access to primary health care for its people. The awarding the Minister of Health the Vice Premier title has raised the political importance of the Health Ministry. Major reforms of China's health care system may now gain momentum. Beijing and local governments in Year 2000 announced new funding of $1,300,000,000 for the beleaguered national health system. Other solutions, such as decentralization of services through community health services, privatization with domestic as well as foreign enterprises, are also being offered as possible remedies.


Government Health Care Reforms

Privatization
In 1996, China held its first National Health Conference to develop major health policies for the next decade. China is implementing a series of reforms in urban health care by offering economic incentives to hospitals. Government reform programs are focused on creating a competitive environment, allowing for joint ventures and privatization in health care, and the installation of a new medical insurance system. Today, there are approximately 330,000 medical institutions in China funded both by local Chinese and foreign investors. There are more than 2,000 hospitals at the country level and 50,000 hospitals at the township levels. China's public hospitals are over burdened, with individual patient care less than desirable due to the large patient load of each doctor; whereas, existing foreign invested health care enterprises consist primarily of small, fairly low profile joint venture clinics and departments within hospitals, as well as several free standing modest hospitals.


Joint Ventures
In Year 2000 China's Central Government -- agreeing with the W.H.O. recognition of the nongovernmental sector as an important source of technical know-how, skills and resources -- structured new laws to allow and encourage private sector participation to meet the country's unmet health care needs. Private sector participation would include domestic and foreign participation, plus non-profit and for-profit enterprises. Specifically, on December 8, 2003 the Shanghai Municipal Government issued Document No. 70, Some Suggestions on Improving Hospital Establishments and Developing Non-Governmental Medical Organization's fully supporting and encouraging hospital development by the private sector.

Under the new regulation in compliance with the W.T.O. rules, the minimum investment in a health care joint venture project is $2,400,000 in which the Chinese investor holds at least a 30% share with the maximum share for the foreign investor at 70%. If the joint venture is launched in central or western China, or in other undeveloped areas, the terms may be relaxed to encourage growth in these far flung areas. For-profit medical entities are allowed to be managed independently, fixing their own price structures, and paying the established government taxes.

The Government is looking for foreign joint venture partners to help with the long-term development and advancement of China's health care system. China needs and wants advanced medical technology from abroad.



Medical Insurance
Medical insurance reform became a priority in Year 2000, with the Central Government aiming at covering 80,000,000 urban workers by the end of the year. By 2001 health insurance for urban workers had been launched in 97% of the country's prefecture level regions, with 76,300,000 actually covered. Still about three-quarters of the population have no insurance coverage. A multi-level medical insurance system with alternative forms of premium payment plans is being structured. The ongoing reforms are not designed to expand the number of insured, but rather to replace government funding with enterprise/employee funding. Workers who can not afford the premiums can join the basic medical insurance of the overall planning fund. In 2001, revenue from basic medicine insurance was $2 billion and expenditures was $l.5 billion.

From December 11, 2001, foreign non-life insurance companies can establish branch companies or hold up to 51% of the shares of the joint ventures. Shares owned by the foreign investor in a life insurance joint venture should not exceed 50%. At present, foreign investment is limited to the major markets of Guangzhou, Shenzhen, Foshan, Shanghai, and Dalian. Within three years of the W.T.O. accession, there will be no geographic restrictions. Some of the foreign insurers in China are CNP Assurances (France), CGU (UK), Transamerica (Dutch), AXA (France), Gerling Insurance Company (Germany), Alliance (Germany), Zurich Insurance Company (Swiss), and Royal & Sun Alliance (UK). Cigna hopes to get a license for a joint venture with the China Merchants Group by the end of 2003.

Early 2002, the China Insurance Regulatory Commission (CIRC) acknowledged 51 foreign and domestic insurance companies in China, including 11 in various stages of formation. Foreign insurance joint ventures accounted for 26 of the life and non-life insurance companies licensed in China.

Presently, foreign health insurers are not allowed to participate in the Chinese markets. China has agreed to open health, pension group, and all non-life insurance markets (except statutory insurance) by 2005. In the interim, the United Family Hospital, the first Western for-profit hospital in Beijing, has offered an affiliated health plan to Motorola and Conoco Phillips. Additionally, many major Western insurance companies have a direct billing arrangement with the United Family Hospital. World Link Medical and Dental Centers works with health insurance plans from these insurance companies: AIA (USA), BUPA International (UK), Tie Care, Jemeh (Kerry Medical Insurance). Shanghai First People's Hospital International Medical Care Center only works with the insurance companies -- Wellbe and SOS (Dutch). Most insurance providers only recognize the top tier hospitals. 

The major Chinese insurance companies are Ping An Insurance, PICC Life Insurance, and China Pacific Insurance Company, Ltd. China's goal is to have the companies and workers evaluate and select commercial health insurance that is appropriate and more tailored to their needs. The entrance of foreign insurance firms into China will help reach this goal by introducing international experience and practices.