China’s leaders, HSPH experts unite in health reform effort

Spring 2009 ]

At the height of China’s SARS outbreak in the spring of 2003, with Beijing reporting hundreds of new cases a day, Yuanli Liu woke up at 3 a.m. in Boston to a ringing telephone. On the line was a senior Chinese government official who had recently been a visiting scholar at the Harvard School of Public Health (HSPH), where Liu is a senior lecturer on international health. After months of avoiding the SARS issue, the country’s leaders had finally decided to take action. “We have $200 million to spend in the next two weeks,” the official said. “What should we do?”

On the advice of Liu and his HSPH colleagues, the Chinese government abandoned plans to build “fever hospitals” around the country and instead spent the money on preventive efforts. Meanwhile, the Chinese embassy in Washington, D.C., approached Barry R. Bloom, then the School’s dean, for advice on how to strengthen the country’s public health system. These discussions sowed the seeds for forging, in 2005, a formal collaboration between China and the School known as the HSPH China Initiative, which Liu directs.

Today, as China launches major efforts to improve public health and provide universal health care for its 1.3 billion citizens, the Initiative is playing an important role in shaping the country’s policies. In January 2009 the central government unveiled a $124 billion plan to provide health insurance to 90 percent of the population by 2011, and to close the gap completely by 2020. Currently, 89 percent of rural Chinese and 70 percent of urban dwellers are covered, reports William Hsiao, the K.T. Li Professor of Economics at HSPH and a senior member of the Initiative’s faculty.

The announcement came just one day after the government disclosed an economic growth rate of 9 percent, its slowest in seven years. China’s universal insurance scheme offers a way to boost the economy, observers say, by freeing up money consumers have been squirreling away for health care emergencies. The scheme is also a strategy for mitigating social unrest as millions of workers who migrated from rural areas to cities lose their factory jobs.

The reforms, which aim to rein in costs by controlling profits reaped by physicians on prescription drug sales, incorporates key recommendations from an Initiative study, says Liu. School faculty members also contributed public health policy advice on such issues as tobacco controlenvironmental health, mental health, and chronic disease control to the government’s “Healthy China 2020” plan, which is expected to be finalized later this year.


With one-fifth of the world’s population, China does everything on a grand scale. In the 30 years since it transitioned from a planned to a market-driven economy, the country has made enormous strides in improving the health and wealth of its people. More than 200 million residents have risen out of poverty. Housing, education, and health care all have seen dramatic improvements.

But challenges remain. Vast disparities in income and access to health care have left China with the infectious disease burdens of a developing country. Meanwhile, rates of diabetes, heart disease, and other chronic conditions have begun to resemble rates in developed countries. And as China’s struggle to clear Beijing’s smog before last summer’s Olympic Games made evident, the economic boom has taken a harsh toll on the environment and, consequently, the people’s health.

Amid these changes, improvements in health care have stagnated, according to Hsiao, who has studied China’s health system for nearly 30 years. Costs are spiraling out of reach for the average citizen, and the system is mired in waste and inefficiency. These problems took root in the 1980s, Hsiao says, when government-funded health care, with its emphasis on public health, was dismantled in favor of a profit-driven system.

Now, doctors’ incomes are tied to the drugs and tests they administer, which leads to unnecessary treatments. Out-of-pocket expenses for patients who lack insurance are crippling. This transition has been hardest on China’s 730 million rural farmers, for whom a single doctor visit can be astronomical, costing 83 percent of one month’s income in 2003, says Hsiao.

Yuanli Liu recounts that, under the socialist system, “Everyone had access to basic medical care. After reform it became, ‘Look after your own affairs.'”

Liu, an expert in health financing and health systems analysis, has advised governments, international bodies such as the United Nations and the World Bank, and nongovernmental organizations. Growing up in China’s Hubei province, Liu helped his military-physician father care for soldiers as well as impoverished local farmers. The experience fueled his desire to champion health care as a basic right within China and globally.

Hsiao, who left China for the United States with his family as a child following a civil war that broke out in the wake of World War II, predicts that his native country’s one-party, authoritarian state will likely succeed in bringing insurance coverage to all except people in very remote areas. Power and decisions flow from the central Communist Party to the National People’s Congress, the President, and the State Council, which includes the government ministries, on down to provincial and local governments.

For a decade Hsiao has worked with China’s central government to get insurance to rural dwellers. As of 2006, peasant-farmers comprised 56 percent of the total population-down nearly 20 percent since 1990 due to the migration of young people en masse to cities. In 2003, Hsiao piloted a subsidized, community-governed basic health care system in two provinces that has helped shape the national plan.

Spending huge sums of money in China won’t be enough, Hsiao says. “If cost inflation and inefficiencies are not carefully tackled, much of the new money injected into the system will most likely end up as profit and income for providers,” he wrote in Health Affairs last year.

The HSPH China Initiative builds on more than 20 years of collaboration in teaching and research between HSPH and China’s government. At a time when many major universities are working with China, the Initiative’s approach remains unique, Liu notes.

“This initiative was founded on the premise of matching China’s emerging needs with what HSPH is good at providing: training public health leaders,” he says. “Pretty quickly, we decided that a major component would be leadership development.”

Since 2005, more than 200 government officials and health care executives have enrolled in the Initiative’s China Senior Health Executive Training Program. The most recent session, in November, attracted the most highly placed individuals yet, Liu reports. Attendees included directors of departments of the Chinese Ministry of Health and provincial bureaus of health, as well as hospital CEOs.

Following one week at Tsinghua University in Beijing, attendees study intensively for three weeks at HSPH. Coverage of topics from environmental and occupational health to regulating the pharmaceutical industry is based on priorities set by China’s leaders and its Ministry of Health. Taught by HSPH faculty and instructors from Harvard Medical School, the Harvard Kennedy School, Harvard Business School, and the Harvard Asia Center, students analyze real-world cases. They also build on their capacity to solve problems back home.

Participants have “the luxury of time to get out of their daily environment to think creatively,” Liu says. “When they go back, their policy recommendations are more informed and substantive.”

David Christiani, a professor of occupational medicine and epidemiology at HSPH, recently completed a study lasting more than 25 years on the health of Chinese textile workers. He has led training sessions on environmental and occupational health since the program began. Participants “increasingly feel a sense of urgency to make progress in areas that are costing lives, impairing well being, and exacting a toll on the economy,” Christiani says. “There’s a trend towards more open, critical thinking and challenges rather than quiet acceptance.”


Public health is part of a broader discussion in China about balancing economic progress with social reforms, says Liu, who organized a policy forum in Beijing in 2007 together with Barry R. Bloom, Anthony Saich, the Daewoo Professor of International Affairs at the Harvard Kennedy School, and William Kirby, the T.M. Chang Professor of China Studies at the Harvard Business School. At the forum, which was held at the Central Party School, where all government officials receive training, speakers addressed social development from all angles, including health and education. A second forum is planned in Boston for the summer of 2009.

Liu and his colleagues also are engaged in research, including a study on the feasibility of imposing a tobacco tax to fund health care reform. Tobacco control in China is a thorny issue given that the industry is run by a lucrative state monopoly. Despite having ratified the World Health Organization’s Framework Convention on Tobacco Control in 2004, China remains the world’s largest tobacco producer and consumer. The Initiative is also advising public health officials who are struggling to rebuild the health care infrastructure in Sichuan province after last spring 2008’s devastating earthquake.

“While remarkable progress has been made, difficult challenges remain,” notes Liu, who visited the area in January. “Seventy percent of the families whose homes were destroyed in the earthquake still live in make-shift houses.”

Amy Roeder is the development communications coordinator in the Office for Resource Development at HSPH.