The COVID-19 pandemic has brought online healthcare and telemedicine to the mainstream. One of the biggest beneficiaries has been online healthcare organisations in China. These are often referred to using the terms ‘telemedicine’, ‘telehealth’ or ‘digital healthcare providers’, and there are said to be thousands operating in the country today.
The American Telemedicine Association defines telemedicine as the practice of providing healthcare services remotely to patients. This is usually over a distance that can be local, national or global. However, cross-border telemedicine is rarely seen due to the lack of regulations and licensing governing cross-border healthcare. This has led to the rise of home-grown startups in China that are fuelling a digital healthcare boom.
Investors have seen dramatic share price increases between 33% and 74% in some of the largest online healthcare providers, Ping An Healthcare and Ali Health, respectively. Patients are staying indoors to stem the spread of the virus, and the pandemic has forced healthcare organisations to adopt technological solutions to continue serving patients in need.
China’s healthcare needs are enormous when considered alongside those of other nations. This is, of course, relative to the size of China’s 1.39 billion population, which is ageing in an over-stretched healthcare system. It is not uncommon to see the top hospitals in China overwhelmed with patients, and the arrival of telemedicine could play a key role in easing this pressure.
China is expected to become the world’s largest digital healthcare and telehealth market. Experts were predicting growth at approximately 15% per annum before the pandemic began, but the COVID-19 pandemic has blown this prediction out of the water. Telemedicine utilisation rates in China are increasing tenfold in some areas.
Growth enabled by the Chinese Government
The Government of China began implementing telehealth standards in 2014. This included setting the definitions, requirements and guidelines for operators, but despite this, the healthcare market saw limited adoption of telemedicine technologies. The COVID-19 pandemic has opened up opportunities in China for healthcare startups and established firms to serve the needs of patients.
Since the beginning of the pandemic, health regulators have been fast-tracking licenses to providers to operate telemedicine technologies. While this created a supply of services, patient demand naturally skyrocketed because of lockdown circumstances and the advice of the Government to access medical professionals via smartphone, tablet or laptop for anything but an emergency.
Tech giants of China lead the online healthcare boom
Online healthcare in China is forecasted to become a 198 billion-yuan business by 2026. The recent boom in online doctor consultations has been led by the tech giants of China, who have jumped at the opportunity to develop telemedicine solutions for this emerging sector.
Ping An Healthcare &Technology Co., a Shanghai-based company, developed the healthcare ecosystem platform Ping An Good Doctor (Good Doctor) app in 2014, featuring providers in every possible speciality. It is the first online health platform to boast more than 300 million subscribers. Good Doctor has a subscription service offering online consultations for as little as $70 per year. Already, Good Doctor has exported its services to Singapore, Japan and Indonesia with local joint ventures.
Alibaba is offering AliHealth, and during the pandemic, it has provided access through its other subsidiary applications, such as AliPay and Taobao. This has enabled AliHealth to reach a significant audience, compounded by the fact that consultations were offered for free.
Tencent has joined the race to capture digital patients as well. Tencent offers the WeDoctor platform, and it has partnered with the British startup Babylon to incorporate AI and telehealth technologies into its offering.
JD Health, a Fortune 500 company, says their monthly consultations are up tenfold since the COVID-19 outbreak began. The pandemic has seen JD grow their market share as they have offered free consultations to 60 million Chinese nationals living overseas.
Other Chinese firms include Chunyu Doctor, which has the most extensive internet penetration rate amongst telehealth companies. There is also California based MORE health, who partnered with Chinese doctors to enter the market in 2018, enabling collaboration between US academic medical personnel and doctors in China.
According to the data firm Tianyancha, there are over a thousand home-grown telehealth firms in China that are connecting doctors to patients. This is not difficult to believe, considering the enormity of China’s healthcare needs.
The COVID-19 pandemic has given the emerging telehealth sector a much-needed boost. However, Chinese health authorities will continue to invest in modern hospital infrastructure, as it is unlikely that patient demand for in-person healthcare will be fading away any time soon.
At the moment, most telehealth licenses restricts online doctors from making a clinical diagnosis. They can provide routine advice, follow up consultations, second opinions and issue prescriptions. However, if a clinical diagnosis is required, the patient must pay a visit to a doctor in a healthcare facility. Such limitations suggest that the Chinese telehealth industry will play a complementary, rather than a competing role with the traditional healthcare industry, at least for now.
Those entering the digital healthcare market are in for a fierce battle, where innovation in serving patients’ needs will be pivotal to success. Those that succeed in reaching the hearts, minds and smartphones of Chinese patients look set to stay.