Ministry of Health of China is to ban hospitals from buying expensive medical equipment on their own, a move that is part of a widening campaign against corruption in the health sector, the Finacial Times reported Monday.

The imposition of a system of "collective purchasing" for medical devices costing more than 2m yuan ($250,000) is also intended to prevent foreign suppliers from selling relatively untried equipment in China, according to state media. The new rules could hurt local sales of international suppliers such as GE Healthcare and Philips Medical Systems, which see China as a strategically important growth market, the report said.

The report said that China's medical equipment market has been forecast to grow from $1.2bn in 2005 to more than $12bn by 2010, but officials have grown concerned about widespread corruption among those involved in purchasing decisions.

Doctors and administrators have been accused of taking kickbacks for ordering equipment that is not needed or that is priced artificially high. Many hospitals are thought to use advanced medical equipment to charge patients high rates for unnecessary tests.

The official Xinhua news agency said collective equipment purchasing, which would be organised by provincial-level governments, represented an ¡°attack¡± on corruption and bribe-taking. It quoted ministry officials as saying they planned to authorise a national medical equipment association to review equipment and issue standards for consideration by provincial purchasers.

"The first [goal] is to prevent hospitals from becoming 'test sites' for some foreign medical equipment companies by taking equipment that has only recently been registered overseas," Xinhua said.

The equipment reviews were intended to encourage hospitals only to buy devices that were really needed, and thus to "naturally reduce" the number of unnecessary tests ordered for patients, it said. But there is no guarantee the rules will reduce corruption.

Courtesy of Mure Dickie, the Financial Times