Published by ChinaMNC · Penglai

China's Health Sector Reform: What Foreign Founders Need to Know

A national health conference chaired by Xi Jinping signals priorities for China's healthcare system during the 15th Five-Year Plan period, with implications for foreign founders in health-related industries.

China's Health Sector Reform: What Foreign Founders Need to Know

A national health conference held in Beijing on October 12–13, chaired by Xi Jinping, set out priorities for China's healthcare system during the 15th Five-Year Plan period. The meeting emphasized a health-first development strategy and outlined goals for building a "Healthy China" by 2035. For foreign founders registering or operating a company in China, these priorities may shape regulatory focus, market opportunities, and compliance expectations in health-related sectors.

Health as a National Priority

President Xi stated that the 15th Five-Year Plan period is critical for achieving the goal of a Healthy China by 2035. He called for steady progress along a health development path with Chinese characteristics, focusing on strengthening advantages, fixing shortcomings, and improving weak links. The overarching aim is high-quality development of health services and continuous improvement in public health.

Since the 18th Party Congress, the leadership has placed health security in a priority strategic position and launched major initiatives to build a Healthy China. According to the speech, China has established the world's largest systems for medical services, traditional medicine, disease prevention and control, and medical security. These achievements are presented as historic and comprehensive.

Key Goals and Principles

The Healthy China being pursued is described as balanced, inclusive, high-quality, and efficient. It should possess strong capacities in health management, disease control, medical services, medical insurance support, pharmaceutical innovation, and talent development. The goal is to meet growing public health needs and steadily improve major health indicators.

Health is characterized as having a foundational and overall role in development. The health-first strategy requires integrating health considerations into all policies and work areas. This includes prioritizing health impacts in planning, policy design, project evaluation, and construction.

Prevention and Public Health

Prevention is highlighted as the most economical and effective health strategy. The focus includes:

• Guiding society toward correct health concepts and effective health self-management.
• Helping youth develop good study and life habits for all-round development.
• Creating healthy ecological and living environments, and encouraging fitness and healthy leisure.
• Strengthening food safety supervision.
• Improving the disease control system and preventing large-scale epidemics.

Improving Medical Services

Raising the overall level of medical services is a key task. The plan includes:

• Implementing a foundation-strengthening project for healthcare, optimizing the layout and functions of medical institutions, and promoting tiered diagnosis and treatment so people can access care nearby.
• Enhancing comprehensive prevention and control of chronic diseases and improving the full chain of prevention, treatment, rehabilitation, and management services.
• Improving mechanisms for the inheritance and innovation of traditional Chinese medicine and strengthening integrated Chinese-Western medicine.
• Boosting basic research and original innovation in health, promoting technology transfer, and expanding the health industry.
• Improving patient experience and convenience.

For foreign founders in medtech, pharmaceuticals, or digital health, these points suggest potential opportunities in innovation, technology transfer, and service optimization, but also indicate closer alignment with national priorities.

Reform of Medical Insurance and Pharmaceuticals

Reform is described as a powerful driver. The main direction is coordinated development and governance of medical services, medical insurance, and pharmaceuticals. Specific measures include:

• Fully implementing reform plans for public medical institutions, deepening public hospital reform with a focus on public welfare, and strengthening operational support for county-level and primary care institutions.
• Building a multi-tiered medical insurance system, optimizing centralized procurement of drugs and consumables, medical insurance payment, and fund use policies to ensure fund safety, hospital operation, and reasonable patient burden.
• Improving drug supply and use mechanisms, the national essential medicines system, and drug quality and safety supervision.

Foreign companies involved in pharmaceuticals or medical devices should note the emphasis on centralized procurement and quality supervision, which may affect pricing and market access strategies.

Talent and International Cooperation

Strengthening the health workforce is another priority. This includes selecting strong leadership for health authorities and medical institutions, building a sufficient and well-structured team of medical personnel, improving medical ethics, and fostering respect for healthcare workers.

On international cooperation, President Xi called for building a global community of health for all, jointly addressing major health challenges, and enhancing the well-being of people in all countries. He emphasized deepening cooperation in health under the Belt and Road Initiative, innovating foreign health aid, and sharing China's health story to build international consensus. This suggests continued openness to international collaboration in health, which may benefit foreign firms seeking partnerships.

Implementation and Focus Areas

Premier Li Qiang, in his summary, stressed that the speech answers fundamental questions about health work and provides guidance for the new era. He called for conscious and active implementation of the health-first approach, balancing basic guarantees with quality improvement, and deepening reform, innovation, and opening-up. Specific focus areas include:

• Addressing pain points and public concerns in health.
• Major disease prevention and control.
• Building the tiered diagnosis and treatment system.
• Improving patient experience.
• Developing a multi-tiered medical insurance system.
• Leveraging the unique advantages of traditional Chinese medicine.
• Health services for the elderly and children.
• Technology empowerment in health.

These priorities may guide regulatory and funding directions, offering signals for foreign founders in health tech, elder care, and pediatric care.

Implications for Foreign Founders

While the article does not specify new rules for foreign investment, the stated directions suggest that health-related sectors will remain a focus of government attention. Foreign founders should monitor policy developments in areas such as:

• Public hospital reform and tiered diagnosis, which may affect market access and partnership models.
• Centralized procurement and insurance payment policies, which influence pricing and reimbursement.
• Encouragement of innovation and technology transfer, potentially creating opportunities for collaboration.
• International cooperation under the Belt and Road Initiative, which may open channels for partnerships.

As always, foreign founders should conduct due diligence and consult professional advisors to ensure compliance with evolving regulations.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.