Private players offer new treatment

Beijing United Family Hospital invested $32 million in the expansion of the main hospital two years ago. It also spent $38 million to build its Beijing rehabilitation hospital. Provided to China Daily

Besides the Beijing United Family Hospital, a joint venture between Chindex International and the Chinese Academy of Medical Sciences, as well as Beijing United Rehabillitation Hospital, Shanghai United Family Hospial and Tianjin United Family Hospital, four other hospitals are in the design or construction stage in Guangzhou, Qingdao, Shanghai and the western part of Beijing.

Chindex's expansion is in accordance with China's advanced regulatory environment. The State Council (China's cabinet) guidelines released last October set a target for the health industry of 8 trillion yuan ($1.31 trillion) by 2020.

"The government said that it wants the private sector to account for about 20 percent of the total industry. Right now, I think it is probably more than 10 percent," Lipson said.

The government's new policies in support in the development of the private sector isn't only for the high end."I think most of the investment will go to the mass market. We are targeting the top 5 percent to 10 percent of the population in terms of income," said Lipson, who has been in China for about 30 years.

In the past 16 years, since the establishment of the Beijing hospital, Lipson has witnessed great changes in the Chinese market. One of the reasons for the company's continued investment in the sector is that Chinese consumers have become more educated about the choices offered by private medical care.

"The economic ability of Chinese patients to pay for private health treatment has also developed," she said. Still, as an early mover in the industry, it faces difficulties. "About half of the doctors at United Family are foreigners. We have to meld the teams from China and outside China," she said.

Further, when Chinese patients decide to pay out of their own pocket for a private hospital, their expectations are very high. For example, Chinese patients usually get scant time from doctors at busy public hospitals. So when they come to private hospitals, they deserve a lot of attention.

"They're comparing our services with those in a five-star hotel," said Lipson.

For delivering a baby, public hospitals charge about 4,000 yuan to 5,000 yuan. It's about 10 times that much at a United Family facility. "I think they deserve our best," Lipson added.

United Family began to make profits in the third year of operations, and the average growth of its business has been over 20 percent annually in the past eight years. The company invested $32 million in the expansion of the Beijing hospital two years ago. It cost $38 million to build its Beijing rehabilitation hospital.