The impact of restricted-data flows on China's digital healthcare solutions

With the advent of information technology in healthcare, there has been a sharp increase in digital solutions that simplify healthcare operations.

From storing electronic healthcare records (EHR) to developing solutions like telehealth that facilitate remote monitoring of patients, technology has been an influential factor in pushing innovation and delivering patient centricity.

That being said, from a holistic perspective, technology is just a driving medium for transferring information. If the flow of information is restricted through external policing or monitoring, healthcare architecture loses the advantage offered by disruptive technology.

That’s exactly what seems to be happening with China.

As patients across the world reap the benefits of personalised care through connected healthcare technologies, China seems to be missing out on the development due to its stringent data-flow and content restrictions.

These restrictions are deeply concerning, especially in the light of healthcare industry’s growing use of cloud technology for storing medical records, patient details, and other sensitive information.

Restricted access to healthcare services not only impacts healthcare providers, device manufacturers and Telehealth investors, but also patients in China, since they cannot access the global healthcare solutions in the digital space.

These data-flow restrictions in China are largely influenced by the government’s growing concerns over cybersecurity, data privacy, and protecting patient information.

However, healthcare providers in China need to be cautious about the implication of these restrictions, as they become a key challenge for business continuity in China and could limit the growth of Telehealth, mHealth and other technology driven healthcare solutions.

In the aftermath of these data-flow restrictions, Chinese manufacturers are already working on market replacements of western digital healthcare solutions with Chinese-developed devices. While that may solve the problem of providing connected healthcare in China, it limits the scope of globally designed solutions and discourages foreign participation.

“To encourage the development of data-driven healthcare solutions, China needs to create well-defined healthcare policies that provide clarity over the ownership and usage of patient sensitive information,” Liu Xiao, healthcare consultant at Deloitte, China, said.

According to Liu, who has also been actively involved in framing digital healthcare policies in China, data-flow restriction is a very complicated issue, especially for foreign players, since there’s not a clear-cut mandate that defines how patient-specific data can be accessed and shared between healthcare providers, pharma brands, payers and patients.

“Numerous foreign players have tried to tap into the billion-dollar Chinese healthcare market with digital solutions, but most of them have found the Chinese market challenging. It’s because China’s healthcare architecture is different and more stringent than its western counterpart. You have to deal cautiously, here.”

Take for instance, the five per cent market penetration of private payers in China, which is almost negligible, when compared to 40 per cent market stake in western economies.

Since the Chinese government holds most of the medical records and is reluctant in sharing them through regulatory and compliant channels, healthcare startups in China are finding it difficult to imitate the western healthcare system and develop personalised patient-centric solutions.

However, Liu believes that the Chinese government is trying to change the scenario by framing policies that would explicate the use of digital technologies like cloud, mobile, and Telehealth towards delivering better and improved healthcare to its rapidly increasing population.

“I cannot say how long it’ll take, since there are too many stakeholders involved. Maybe, it’ll happen in the next five years, or maybe, even more than that. It’s really hard to predict, but if China has to go ahead towards delivering better and connected healthcare, it has to happen.”

Just like China came up with it’s own version of Twitter (Baidu) and Amazon (Alibaba) to counter restrictions and penetrate the market, Liu hopes of something similar happening with disruptive healthcare technology, too.

“The advantage local players have over foreign brands is that they understand the Chinese healthcare segment really well. We have a different medical system and an altogether different patient mindset.

For example, an average Chinese citizen spends around $300US on healthcare every year, and consulting a specialist costs less than a cab ride. Unlike western countries, the problem for China is not affordability, but accessibility.

We have a larger population, and we need remotely accessible digital solutions that deliver scalable, reliable and personalised care, and focus on improving the efficiency of our healthcare system. However, the bigger challenge is to make such a model regulatory approved and sustainable in the long run.”

Moderation of data-flow restrictions in China could largely mitigate China’s healthcare budget, which is projected to grow to $trillion by 2020. It could help hospitals in delivering connected healthcare to patients with chronic ailments, since they account for 71 per cent of the total healthcare expenditure. It could also facilitate improved patient engagement, brand loyalty and personalised interactions.

However, even after the restrictions are moderated, the key challenge would be to modify patient behaviour towards leveraging digital solutions, and to test the equitability and efficacy of these solutions in China’s disparate healthcare system.

Posted in Asia Pacific Health IT

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