Ping an Insurance Group Company of China, Ltd. (hereafter "Ping An," the "Group," or "Group") has invested in a holistic strategy to digital healthcare to address China's rapidly increasing population, rising health care costs, and shortage of healthcare professionals.
According to Jessica Tan, Ping An Group co-CEO of Ping An Group, digital healthcare was only 7% of total Chinese healthcare spending. The COVID-19 pandemic has increased the acceptance of online healthcare services by regulators and consumers.
"We think maybe 20% to 25% [of Chinese healthcare services] could go online. Or even a part of it. But the bulk will still be offline. However, you still need to solve offline problems and technology can help these professionals," Ms. Tan explained.
Ping An has used its financial and technological expertise to create an open-loop healthcare system with 12 Group entities supporting the government, healthcare service providers, and medical professionals, as well as social and commercial insurers and consumers.
Ms. Tan explained that healthcare services are an essential and distinctive part of our insurance. Therefore, we have bundled our insurance with healthcare services. "We are one the largest online providers of healthcare services, and we believe that the digitization of healthcare services will soon be common. We wish to be one the top players in this field."
She indicated that China's healthcare industry is expected to grow by RMB6 trillion in 2019 and RMB16 trillion in 2030. With a growing population of elderly and more affluent citizens, there is a rapid increase in demand. There are, however, major problems: With 3.8million doctors and 4.4million nurses for a population of 1.45 billion, there may be a shortage of up to 700,000. Doctors and millions of nurses in China, as compared with Western countries. It is essential to control rising costs. Chinese consumers can spend up to 10% of their disposable income, compared to US consumers who only pay 7%. Ms Tan noted that the government's social health insurance spends are increasing faster than the income. Therefore, commercial insurance, which is only 7% of total payments, could be expanded to ease the burden of out-of-pocket spending.
Ping An Good Doc, the first pillar of Ping An's healthcare strategy, has become China's most comprehensive online healthcare service portal. You can access Ping An Good Doctor 24/7 for online consultations, prescriptions, second medical opinions, and drug delivery. Ping An Good Dr had 373 million users as of December 31, 2019, and was partnered by more than 3,700 pharmacies and 151,000 hospitals.
The second pillar aims to support offline medical professionals using tools such AskBob Doctor. An artificial intelligence (AI)-driven clinical decisions support system and medical imaging and analysis. AskBob Doctor has already supported 250,000 medical establishments and 750,000 physicians, allowing for more accurate diagnosis and better treatment recommendations. These tools were developed and affiliated with Group subsidiary Ping An Smart City. Ping An Smart Healthcare helps China develop its health care system. This includes improving the management of institutions by medical authorities and doctors, assisting doctors with diagnosis and treatment, supporting public health systems to manage epidemics, chronic diseases, and facilitating pharmaceutical research.
Ping An Group believes that the healthcare industry plays a crucial role in the Group's core financial business. For the past four years, between 15% and 20 percent of Ping An's financial customers came from the healthcare system. These customers had an average of 32.9 financial contracts and RMB39.100 per capita in AUM, compared with 2.1 financial agreements for people who did not use the health care ecosystem and RMB17,000.00 per capita.