A Study On Health Industry Regulation In China

In the modern civilized society, the health care industry becomes more and more important, this can be proved by a simple fact that the national health expenditure proportion in GDP rises year by year. People choose to spend more income to purchase medical services, not only because the life and health is important. On the other hand, health care providers choose more expensive means to provide medical services, not only because of its own advantage trade status. The choice of producers and consumers, are depend on the existing production system and market environment. While the regulation system develops, the character of health care market develops, the problems of health care costs, problems of fairness, problems of convenience and quality of the medical treatment, are all result from improper regulations.This paper reviews the evolution of China’s medical system, analyzes the four main stages of medical service system in China, and explains the problems and its reasons in the system, and analyzes China’s current medical service industry market concentration, product competition characteristics, barriers to entry, industry structure and area distribution characteristics by industrial organization approach. Combining with the typical international comparison of national medical service system, we find the medical service industry in China regional market concentration is too high, the government owned hospital’s monopoly power is too large, barriers to entry is strong. Those market character and Urban-rural dual structure led to a insufficient competition health market.In order to find the cause of those problems, this article deeply analyzes our country government on medical service industry access, layout planning, price and quality regulation system, study the statistical and survey data on the regulation of regulation effect, and discovered access system is not perfect. The government direct investment into health care, distorted price system, and ineffective quality supervision system are causes of the problem. To solve the current problems existing in medical service industry, some areas have implemented many policy test. In recent years, the nation government has implemented basic drug system, public hospital reform programs. Some policy have been proved successfully, while some policy failed. Based on policy effect and we can conclude that to increase finance aid to patient, to withdraw from directly investing into medical industry, to adjust regulation system of medical industry, to reduce direct pricing, to reform physician training system and to transform payment rule from item payment system to prospective payment system will make our health care industry well.