VZCZCXRO2755
RR RUEHCN RUEHGH
DE RUEHGZ #0628/01 3130555
ZNR UUUUU ZZH
R 090555Z NOV 09
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 1088
INFO RUEHGZ/CHINA POSTS COLLECTIVE 0334
RUEHBJ/AMEMBASSY BEIJING 0867
RUEHGH/AMCONSUL SHANGHAI 0268
RUEHCN/AMCONSUL CHENGDU 0269
RUEHSH/AMCONSUL SHENYANG 0278
RUEAUSA/DEPT OF HHS WASHINGTON DC 0053
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC 0117
RUEATRS/DEPT OF TREASURY WASHINGTON DC 0197
RUEKJCS/SECDEF WASHDC 0007
RUEAIIA/CIA WASHDC 0317
RUEKJCS/DIA WASHDC 0313

UNCLAS SECTION 01 OF 03 GUANGZHOU 000628 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/CM, OES/IHA, MED 
STATE PASS TO ENVIRONMENTAL SCIENCE & TECHNOLOGY COLLECTIVE 
STATE PASS TO USAID FOR ANE AND GH 
HHS PASS TO OGHA, NIH/FIC, CDC/COGH 
BANGKOK FOR RMO, CDC, USAID 
BEIJING FOR HHS HEALTH ATTACHE AND RMO 
 
E.O. 12958: N/A 
TAGS: SOCI TBIO ELAB PGOV CH
SUBJECT: Fujian Officials Describe Rural-Urban Disparities in Health 
Care and Insurance Coverage 
 
(U) This document is sensitive but unclassified.  Please protect 
accordingly.  Not for release outside U.S. government channels.  Not 
for internet publication. 
 
¶1.   (SBU) Summary:  Public health officials in Fujian admit there 
are significant gaps in the level of medical care and health 
insurance protection available to Fujian residents.   Farmers, in 
particular, fare poorly in the type of government health insurance 
coverage and health care to which they have access.  Rural areas 
suffer from a severe shortage of doctors.  Urban workers, on the 
other hand, generally receive broader insurance coverage, and they 
have access to the best medical facilities and doctors.  Urban 
residents who are unemployed, work part-time, or who are migrant 
workers or students fare have more limited coverage.  End summary. 
 
Health Care Resources Concentrated in Major Cities 
--------------------------------------------- ----- 
¶2.  (U) To serve its population of approximately 36 million, Fujian 
Province has a total of approximately 20,000 medical care 
facilities, including hospitals, clinics and infirmaries.  Public 
health officials in Fujian frankly acknowledge that the existing 
infrastructure cannot adequately meet current demand and provide 
comprehensive medical care to all of Fujian's residents.  Currently, 
medical resources and personnel are concentrated in urban areas. 
Fujian's top-grade (Grade III, A Level) hospitals are all located in 
major cities.  In addition to major and specialized hospitals, the 
larger cities have a network of almost 9,000 community hospitals, 
clinics and infirmaries.  For example, public health officials in 
Xiamen noted that the city has over 1,100 hospitals, clinics and 
infirmaries at all levels. The city has three major hospitals and 
two specialized hospitals of the top grade.  In addition, the city 
has over 20 government-funded hospitals at the community level. 
Community hospitals, clinics, and infirmaries provide basic medical 
services to urban residents at a lower cost than the major 
hospitals. 
 
¶3.  (SBU) Because they provide advanced levels of care, facilities 
and expertise, major hospitals and medical centers in urban areas 
attract both urban and rural residents.  The outpatient department 
of the Fujian Provincial Hospital in Fuzhou reportedly treats over 
1.4 million patients on an annual basis. Officials estimate that 30% 
to 40% of the patients in Xiamen's general hospitals come from 
surrounding rural areas.  Public health officials told ConGenOff 
that due to heavy demand for medical services, all of Fujian's major 
hospitals are forced to operate at maximum capacity around the 
clock.  Patients face long waits before they see a doctor; although 
doctors spend only minutes on each patient, the doctors still must 
put in long hours to meet demand.  Many hospital wards are filled to 
overflowing with patients.  Hospital officials say that the 
challenge of meeting current demand imposed by an ever-growing 
number of patients makes it difficult and almost impossible to take 
steps to improve the quality of medical services provided. 
 
Doctors Avoid Rural Areas 
------------------------- 
 ¶4.  (SBU) Although Fujian has over 10,000 clinics and infirmaries 
that are located in rural areas, these clinics and infirmaries 
generally provide only basic medical care, i.e. treating minor 
ailments and injuries.  Serious cases are almost always referred to 
larger hospitals in urban areas.  Many rural residents are not 
covered by existing health insurance systems (see below) and, 
consequently, are reluctant to use the local clinics and infirmaries 
even for minor ailments and injuries.  According to a rural doctor 
in Fujian's Pingnan County, most rural residents do not receive 
adequate health care.  For cost considerations, they seldom visit a 
doctor or pharmacist, even if they do not feel well, and they almost 
never receive regular physical exams.  Rather, they generally try to 
"endure the pain" and hope that any discomfort will go away. 
Alternatively, they may go to a rural drug store and, without 
professional medical advice, select a medicine that looks like it 
may be useful.  This rural doctor noted that due to lack of adequate 
preventative medical care, many rural residents develop advanced 
stages of severe illnesses including cancer, diabetes or hepatitis 
 
GUANGZHOU 00000628  002 OF 003 
 
 
before they receive any medical treatment.  In many cases, by the 
time they receive medical care, it is too late. 
 
¶5.  (U) For lack of business, many of the rural clinics and 
infirmaries operate at a deficit.  Because doctor salaries depend 
heavily on the number of patients a doctor sees, most of the rural 
clinics and infirmaries are unable to offer competitive salaries. 
Consequently, many rural areas are unable to attract skilled medical 
personnel.  Public health officials in Xiamen noted that in order to 
help remedy this problem, they have begun to link job promotion 
opportunities at urban hospitals with a requirement that candidates 
seeking promotion serve for specified periods of time in rural 
areas.  Nonetheless, rural areas continue to experience a severe 
shortage of skilled medical personnel. 
 
Limited Health Insurance for Farmers 
------------------------------------ 
¶6.  (U) Government health insurance coverage varies from locality to 
locality.  Most of the government plans are based on a complex 
tiered system offering varying levels of coverage for outpatient and 
inpatient care depending on whether an individual is an urban or 
rural resident, or a migrant worker.  Rural residents, in general, 
receive very little coverage.  Farmers who are able to pay a small, 
fixed premium annually receive coverage for some inpatient expenses 
but not for outpatient costs.  In Xiamen, average annual income for 
rural residents is approximately US$ 1,240 and the annual premium 
for farmers and migrant workers is 200 RMB (US$ 29), of which the 
individual must pay 50 RMB (US$7) and the Xiamen government 
subsidizes the remaining 150 RMB (US$ 22).  When it comes to 
hospitalization costs, insured rural residents, like urban 
residents, still must pay the first 1,000 RMB (US$ 146) of inpatient 
costs.  Afterwards, the government covers 70% of the costs up to 
5,000 RMB (US$ 732).  If expenses exceed 5,000 RMB, rural residents 
must cover the expenses on their own-unless they qualify for 
government funding available for specified, severe illnesses or 
become the beneficiary of an NGO that helps individuals with severe 
cases. 
 
¶7.  (U) Throughout Fujian, the outpatient expenses of rural 
residents are not covered by the government medical insurance.  As 
noted earlier, because rural residents must pay all of the cost of 
outpatient treatment on their own, many opt not to go to the clinics 
or infirmaries to receive preventative or primary medical care. 
When rural residents do seek outpatient medical care, they try to 
avoid the larger hospitals-the very hospitals possessing advanced 
diagnostic capabilities- where outpatient charges are higher than at 
smaller clinics and infirmaries. 
 
Better Coverage for Urban Workers, But Still Gaps 
--------------------------------------------- ---- 
¶8.  (U) Urban residents with employers who contribute to the 
government health insurance plan qualify for both outpatient and 
inpatient health insurance coverage.  Subject to certain limitations 
and a co-payment requirement of 20%, outpatient medical charges are 
generally covered in full.  Medical insurance reimbursement rates 
depend, in part, on the category of hospital the patient visits. In 
order to encourage more people to visit smaller, community level 
hospitals, the reimbursement rate provided for medical expenses at 
the smaller hospitals is higher than the reimbursement rate provided 
for expenses at major hospitals.  Urban workers' inpatient medical 
expenses up to 5,000 (US$ 732) RMB are covered in the same manner as 
they are for rural residents (described above).  HoweQQQfaQeP~ urban 
residents.   No government insurance is available to cover costs in 
excess of RMB 50,000.  Individuals may subscribe to private 
insurance plans to cover these catastrophic health costs. 
 
¶9.  (U) Urban residents who work only part time must pay an annual 
premium of RMB 300 (US$ 44), of which the Fuzhou government offers a 
subsidy of 150 RMB (US$ 22).  Students pay a premium of RMB 100 
 
GUANGZHOU 00000628  003 OF 003 
 
 
(US$15), of which 60 RMB (US$ 9) is subsidized by the city 
government.  This provides insurance coverage for limited inpatient 
treatment only.  Outpatient coverage is not provided.  The 
government will provide full reimbursement for accident-related 
expenses of students.  The government also will fully reimburse 
allowable fertility-related medical expenses.  Part-time workers, 
like rural residents and migrant workers, are not eligible to tap 
into the government's medical insurance pool to cover inpatient 
costs in excess of 5,000 RMB (US$ 732).  To help patients with 
financial hardships, some hospitals have offered lower-cost options 
including "low cost beds" that are often placed in corridors and 
"zero profit" medicines. 
 
¶10.  (SBU) Although employers are obligated to make contributions to 
the government insurance plan on behalf of migrant workers, migrant 
workers generally receive coverage that is limited to inpatient 
medical care.  Even though contributions have been made to the 
locality (where the migrant laborers are working) medical insurance 
pool on their behalf, migrant workers are not eligible to tap into 
the pool for inpatient expenses that exceed 5,000 RMB (US$ 732). 
This is because the migrant workers are not officially registered as 
living in the locality.  Comment:  The inability of migrant workers 
to tap into the local insurance pools means that contributions made 
on the migrant workers' behalf become de facto "donations" to the 
locality's insurance pool.  Although a number of individuals have 
raised complaints about the unfairness of this system, the insurance 
pool system continues to operate in a manner that exploits migrant 
workers.  End comment. 
 
Looming Need for Medical Care and Insurance Reforms 
--------------------------------------------- ------ 
¶11.  (SBU) Comment:  Despite China's supposed socialist 
underpinnings, health care today is not provided to the masses in an 
egalitarian manner.  The current system favors the urban workers 
whose contributions fund the system; even these residents often feel 
compelled to save substantial sums to cover catastrophic health care 
expenses.  Rural residents, often of limited economic means, are 
largely neglected by the insurance regime.  Among the beggars and 
panhandlers on China's streets, it is not unusual to see 
individuals, pleading for donations, who bear placards detailing 
circumstances describing urgent medical needs for which the 
individual and her/his family are unable to pay.  Of the myriad 
possible sources of discontent on the part of China's rural 
population, lack of access to adequate health care remains a leading 
possibility.  End comment. 
 
GOLDBECK