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Trillions of new outlets!

 Last Update: 2021-11-15
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 Author: User

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At present, the big health industry has become a new engine leading China's economic development.
Under the combined effects of policies, markets and investment, it is ushering in a golden period of rapid development
.

Here, the author specially launches the "Big Health Industry-Real Estate Research" series of special topics to analyze and discuss the development status, investment layout and industry cluster mode of the popular sub-fields of the big health

Health insurance is one of the three pillars of China's medical security system.
In recent years, with the continuous deepening of China's social medical insurance system and the continuous improvement of residents' income levels, the industry has maintained a momentum of rapid development
.

In 2020, the China Banking and Insurance Regulatory Commission jointly issued the "Opinions on Promoting the Development of Commercial Insurance in the Field of Social Services" and proposed the development goal of "striving to achieve a market size of over 2 trillion yuan in commercial health insurance by 2025", a "trillion-billion market.

To this end, this article focuses on analyzing the development status of the health insurance industry and the development model of each link for the reference of local governments and industrial investors
.

01.
Industry definition and product classification

According to the "Health Insurance Management Measures" promulgated by the China Banking and Insurance Regulatory Commission in 2019, health insurance refers to insurance companies that pay insurance money to the insured due to health reasons or medical behaviors.
It mainly includes sickness insurance, medical insurance, and disability income.
loss insurance, health care insurance and accident insurance
.

Table 1: Classification of China's health insurance

Source: Flint Creations compiled according to public information

02.
Development history and policy evolution

With the gradual liberalization and regulation of the health insurance industry by national policies, China's insurance industry has resumed since 1979, and has gone through stages of initial development and professional operation, and is now gradually embarking on a road of rapid development
.

The first stage: the initial development stage (1978-2003)

In 1979, the country gradually resumed domestic insurance business.
The insurance market expanded from the exclusive operation of the People's Insurance Company of China to Ping An Insurance and Pacific Insurance
.

In 1983, the first health insurance business "Shanghai Cooperative Employee Medical Insurance" was born in Shanghai
.

In 1994, Zhenjiang and Jiujiang were designated by the State Council as pilot cities for the reform of the employee medical security system
.

In 2002, the Standing Committee of the Ninth National People's Congress passed a decision on amending the "Insurance Law of the People's Republic of China", proposing that property insurance companies can operate short-term health insurance from 2003
.

The second stage: professional operation stage (2004-2015)

In June 2006, the State Council issued the "Several Opinions on the Reform and Development of the Insurance Industry", requesting to strengthen support for professional health insurance companies and other professional companies, and the policy dividend greatly promotes the development of the industry
.

In August 2006, the China Insurance Regulatory Commission promulgated the "Health Insurance Management Measures", which became the first specialized regulatory regulation for health insurance, which unified the regulatory standards for property insurance companies, life insurance companies, and professional health insurance companies on health insurance business operations
.

In September 2013, the State Council issued the "Several Opinions on Promoting the Development of the Health Service Industry", which began to propose commercial health insurance as a separate policy requirement, and put forward feasible development suggestions for health insurance services
.

In 2014, the "Several Opinions of the General Office of the State Council on Accelerating the Development of Commercial Health Insurance" stated that social capital such as health service industry capital and foreign health insurance companies are encouraged to invest in the establishment of professional health insurance companies
.

The third stage: rapid development stage (2016 to present)

In December 2016, the State Council issued the "Thirteenth Five-Year Plan for Deepening the Reform of the Medical and Health System", which for the first time proposed "vigorously develop consumer health insurance" to promote the development of various types of health insurance and strengthen the protection attributes of health insurance
.

In January 2020, 13 departments including the China Banking and Insurance Regulatory Commission jointly issued the "Opinions on Promoting the Development of Commercial Insurance in the Field of Social Services" to support the investment of insurance funds in the fields of social services such as health and pensions
.

It is proposed that by 2025, the commercial health insurance market will exceed 2 trillion yuan and become an important part of the medical security system with Chinese characteristics

In June 2020, the "Law of the People's Republic of China on Basic Medical Care and Health Promotion" was formally implemented
.

This law is the first basic and comprehensive law in the field of health in China

03.
Status Quo of Industry Development

(1) Market scale: The health insurance industry is developing rapidly, and the market scale is expected to exceed 2 trillion yuan by 2025

From the perspective of premium scale, the premium scale of China's health insurance has increased from 69.
2 billion yuan in 2011 to 817.
3 billion yuan in 2020, with a compound annual growth rate of more than 30%
.

At the same time, according to the "Opinions on Promoting the Development of Commercial Insurance in Social Services" issued by the China Banking and Insurance Regulatory Commission in 2020, the scale of the commercial health insurance market will strive to exceed 2 trillion yuan by 2025

Figure 2: 2011-2020 China's health insurance original premium income (unit: 100 million yuan) and growth rate changes Source: China Banking and Insurance Regulatory Commission, Firestone Creation

From the perspective of commercial health insurance compensation expenditures, the annual compensation amount of insurance companies has increased from 36 billion yuan in 2011 to 292.
1 billion yuan in 2020.
Health insurance compensation expenditures have maintained an average annual growth rate of about 30%, becoming China's insurance compensation expenditures.
One of the fastest growing insurance types
.

Figure 3: 2011-2020 China's health insurance compensation expenditure (unit: 100 million yuan) and changes in growth rate Source: China Banking and Insurance Regulatory Commission, Firestone Creation

In terms of insurance depth and density, China's health insurance depth (health insurance premiums as a percentage of GDP) maintained a rapid growth momentum, rising from 0.
04% in 1999 to 0.
71% in 2019, an increase of 16.
75 times
.

Health insurance density (per capita health insurance premiums) has increased significantly, from 2.

(2) Industrial structure: Eastern China has become the largest premium income region in my country, with the original premium income of the four major provinces all exceeding 50 billion yuan

China's health insurance consumption has obvious regional characteristics.
In economically more developed regions, such as East China, Central China, and South China, it maintains a relatively high premium income
.

In terms of provinces and cities, Guangdong, Shandong, Jiangsu, Henan and other provinces have developed strongly.

(3) Industrial technology: Patented technology focuses on ten hot areas, the Shanghai area has the most applications, and technology companies are accelerating the layout

Patent applications in China's health insurance industry are currently active
.

From the perspective of the distribution of patented technology fields, according to Wisdom Bud data, the top 10 hot technology words in the health insurance industry in 2021 include medical information, head-mounted and composition
.
Further segments, the technology popular words include medical data, health information, health data, patient data, big data, headsets, compounds, extracts
.

From the perspective of the distribution of patented technology fields,

From the perspective of the distribution of regional patent applications, as of August 2021, the number of patent applications in the health insurance industry in Shanghai has reached 120, making it the province with the largest number of patent applications in the health insurance industry in China
.
The second is Guangdong, which currently has more than 80 patents in the health insurance industry
.

From the distribution of regional patent applications,

From the perspective of patent application subjects, Apple has the largest number of patent applications in the health insurance industry, with 273; Ping An Health Insurance Co.
, Ltd.
ranks second with 76 applications; United Health Insurance Company ranks third with applications.
40 items
.

From the perspective of the subject of the patent application,

04.
Analysis of industrial development and investment characteristics

Through a systematic study of the current development status of the health insurance industry in product supply, channel sales, underwriting and claims, asset management and investment, and health service intervention, the author believes that China’s health insurance industry will present a diversified and development model for the industry in the future The development trend of integration, platformization of sales methods, and chainization of investment methods
.

The development trend of diversification of industrial entities, integration of development models, platformization of sales methods, and chainization of investment methods
.

(1) Product supply link: Traditional health insurance companies present the characteristics of echelon development, and new types of health insurance companies are accelerating the emergence of

Traditional health insurance companies present the characteristics of echelon development, with the insurance premium income of the three major insurance companies exceeding 200 billion yuan
.
According to data from Oriental Wealth.
com, the original premium income of life insurance companies in China is 3.
33 trillion yuan in 2020, of which health insurance premium income is 817.
2 billion yuan.
The performance of insurance companies varies.
The premium income of the first-tier companies exceeds 200 billion yuan.
There are China Life, Ping An Life, and China Pacific Insurance
.
Among them, China Life's premium income was the highest with 612.
9 billion yuan, a year-on-year growth rate of 8.
08%; Ping An Life ranked second, with a premium income of 476.
087 billion yuan, a year-on-year growth rate of -3.
61%; CPIC Life ranked third, with a premium income of 208.
46 billion Yuan, a year-on-year growth rate of -1.
91%
.
The premium income of the second-tier companies is between 100 billion and 200 billion yuan, mainly including Xinhua Insurance, Taikang Life, China Life Insurance, and Taiping Life Insurance
.
The rest are third-tier companies, with insurance premiums below 100 billion yuan
.

Traditional health insurance companies present the characteristics of echelon development, with the insurance premium income of the three major insurance companies exceeding 200 billion yuan
.

The emergence of new types of health insurance companies is accelerating, and the three types of investment entities such as real estate developers, Internet companies, and medical institutions have different entry methods
.
Among them, real estate developers mainly enter by buying shares in traditional insurance companies, and their business layout uses traditional business development channels; Internet companies mainly enter through self-construction, acquisitions, etc.
to increase investment layout and carry out Internet health insurance sales nationwide And service business; medical and health institutions are mainly established in cooperation with external investors to actively create a closed-loop health, improve the payment ability of customers through insurance products, release customer needs, and improve the competitiveness of the medical service market
.

Table 2: Layout of investment entities of new insurance companies

Source: Flint Creations compiled according to public information

(2) Channel sales link: the diversified development of sales entities, and the sales manifestation presents the characteristics of online and offline integration and platform development

From the perspective of channel sales, the main body of health insurance sales is mainly composed of insurance agents, official self-operated platforms of insurance companies, professional agencies, third-party platforms, and online part-time agency platform companies
.

Table 2: Types of sales entities and sales manifestations of health insurance channels

Source: Flint Creations compiled according to public information

(3) Claims payment link: from traditional offline claims to online one-stop information-based claims payment methods

From the perspective of claims settlement, health insurance claims gradually realized an offline settlement system consisting of traditional insurance companies, medical institutions, and users to an online one-stop claims settlement system consisting of insurance companies, medical institutions, claims platforms, and users.
Change
.

The transformation of the online one-stop claims payment system composed of insurance companies, medical institutions, claims platforms, and users
.

For example, Le Yue Information Technology (Shanghai) Co.
, Ltd.
, through the "Internet + Medical Health" commercial insurance direct payment platform, provides medical institutions and insurance institutions with the development and operation and maintenance of one-stop online fast settlement services for commercial insurance, online real-time Claim settlement, promote the deep integration of medical + insurance, and become a pioneer in the domestic commercial insurance direct payment industry; Shanghai Meixin Health Technology Co.
, Ltd.
is a multi-party assembly that connects the insurance industry, patient population, medical institutions, pharmaceutical company R&D, payment systems, and health departments Through the creation of an innovative payment and patient welfare platform "Yokangfu", "Kangfu Internet Hospital" and a health insurance solution platform "Pay Zhibao", a business system covering patient services, commercial insurance services and pharmaceutical enterprise services has been built.
Has developed into China's largest medical payer outside of social security
.

(4) Industrial investment link: presenting the investment development trend of "health insurance + healthy real estate"

From the perspective of investment, domestic insurance companies mainly adopt the "health insurance + health real estate" investment development model to build a complete medical-care-insurance industry chain
.
For example, Taikang Insurance focuses on investing in hospitals, clinics, rehabilitation centers, health management centers, community management centers and other health industry real estate products by building elderly care communities + self-built hospitals, investing in holding hospitals + establishing direct payment hospital networks, etc.
, in order to improve medical care- The insurance-insurance industry chain
.

For example, Taikang Insurance adopts methods such as building elderly care communities + self-built hospitals, investing in holding hospitals + establishing direct payment hospital networks, etc.

Investment in the retirement community + self-built hospital model
.
Taikang Insurance has deployed medical and nursing communities in first- and second-tier core cities such as Beijing, Shanghai, Guangzhou, Chengdu, Suzhou, Wuhan, Sanya, and Hangzhou
.
Self-built hospital in Beijing, Shanghai, Guangzhou and other core cities, such as Beijing Yanyuan Kang Tai hospital complex, Shanghai Taikang Shenyuan Kang Hospital Complex, Guangzhou, Guangdong Taikang Park Rehabilitation Hospital
.
Through real estate projects in the health industry, we will build a model of combining medical care and elderly care, promote the sales of endowment insurance products, and extend it to medical services and health care services
.

Investment in the retirement community + self-built hospital model
.

Invest in holding hospitals + establish a direct payment hospital network model
.
Taikang Insurance has invested in secondary and tertiary hospitals such as Nanjing Gulou Xianlin Hospital, Xi’an Angel Obstetrics and Gynecology Hospital, Beijing Jingdu Children’s Hospital, and has established direct access to health insurance covering 28 provinces, municipalities, and autonomous regions, and 189 prefecture-level cities.
Payment network to integrate insurance claims and medical services to promote the sales of medical insurance products
.

Invest in holding hospitals + establish a direct payment hospital network model
.

(5) Health intervention link: the development model of "Internet + health insurance + health management" emerges

From the perspective of health service intervention, the domestic health insurance industry has mainly formed a development model of "Internet + health insurance + health management".
It has gradually transformed from a traditional expense reimbursement type to a managed care.
Service resources, medicines and information, etc.
, meet the health needs of patients and provide integrated health and medical services
.

Case 1: Ping An Insurance

Ping An Insurance established a health cloud data operation service platform, and formed Ping An Health Internet Co.
, Ltd.
to create a "Ping An Health" APP.
With the support of Internet technology and big data platform, it opened up online and offline medical and health service channels, and built a closed loop of the whole process The medical service platform provides multiple services such as diagnosis and treatment, interaction, management, education, talents, health insurance, finance, and health management
.
At the same time, since Ping An Life combined the "Ping An run" health management plan with Ping An Fu insurance products in 2017, it has transformed ex post compensation into ex ante management
.
In 2021, we will successively launch insurance products of "Enjoy RUN, Enjoy RUN, and Enjoy RUN Plus" to build a "new critical illness + new service" system, starting from health services, with private doctors + health, medical treatment, chronic diseases, and severe illnesses.
The four scenarios of disease services provide customers with a full-cycle and accompanying health management experience
.

Case 2: PICC Health

The health industry chain resources of PICC Health and medical maintenance have created an online and offline health management service platform, relying on strong medical resource advantages, technical platform advantages, service experience advantages and health data advantages to build "Internet + health insurance + health management "The new healthy ecology
.
In terms of technology platform, it focused on building the leading intelligent health management service platform in the insurance industry, with the "People's Health App" as the core entry, through the health management service system, all-in-one card interconnection system, health management center system, customer file system, and health management business The powerful support of the system provides customers with full life cycle health management services
.

05.
Promote the full integration of the health insurance industry into the "digital life era"

In general, the current health insurance industry in China has entered a period of rapid development, with continuous enrichment of the industry content, continuous innovation in the development model of various links in the industry, and continuous deepening of the collaboration and cooperation of industrial ecological participants
.
Facing the future, the author believes that health insurance must be compatible with the "Healthy China" strategic incentives, not only to provide medical protection, but also to take the initiative to achieve new value creation, and actively promote the full integration of the health insurance industry into the "digital life era", focusing on Create a data-driven industrial development model, empower the transformation and upgrading of the traditional health insurance industry, urge new formats and new models of the production industry, and further promote the formation of "health management and medical services + health care big data + social insurance and commercial insurance" in all provinces and cities across the country Macro-closed loop of the big health industry
.

Focus on creating a data-driven industrial development model, empowering the transformation and upgrading of the traditional health insurance industry, urging new formats and new models of the production industry, and further promoting the formation of "health management and medical services + health care big data + social insurance and commercial insurance in all provinces and cities across the country.
" "The macro-closed loop of the big health industry
.
"

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