Each designated area will permit a maximum of two foreign-owned hospitals. The key economic zones include the free trade zone, the Lingang Special Area, the Hongqiao business district, and the eastern hub for international business cooperation.
A document released on the municipal government's website indicates that this pilot program aims to further open the healthcare sector, diversify healthcare services, and enhance the overall business environment in the city.
This initiative aligns with a national policy introduced in late November, which allows wholly foreign-owned hospitals in major cities such as Beijing, Shanghai, Guangzhou, Shenzhen, and five other regions.
Experts anticipate that this initiative will draw foreign investment, foster high-quality development in medical services, and better address the diverse healthcare needs of the public.
The Shanghai document outlines that foreign investors must showcase advanced hospital management practices, models, and service standards. They are also expected to provide state-of-the-art medical technologies and equipment, enhance local healthcare capabilities, and broaden the range of healthcare services available.
Approved categories for hospitals include general hospitals, specialized hospitals, and rehabilitation hospitals, all classified as tertiary medical institutions. However, foreign investors are restricted from establishing hospitals focused on psychiatric diseases, infectious diseases, hematology, traditional Chinese medicine, integrated TCM and Western medicine, or those catering to minority ethnic medical practices.
Foreign-invested hospitals are restricted from participating in high-risk medical and ethical practices, such as organ transplantation, assisted reproductive technologies, prenatal screening and diagnosis, inpatient psychiatric care, and experimental treatments involving tumor cell therapy.
These hospitals are permitted to recruit expatriate physicians and healthcare professionals from Hong Kong, Macao, and Taiwan. However, it is required that at least 50% of the hospital's management and healthcare staff originate from the Chinese mainland.
This policy was collaboratively issued by the Shanghai Municipal Health Commission, the Shanghai Municipal Commission of Commerce, the Shanghai Administration of Traditional Chinese Medicine, and the Shanghai Municipal Bureau for Disease Control and Prevention.
Experts in the industry view this initiative as a pivotal advancement in expanding Shanghai's healthcare framework, encouraging medical innovation, and establishing a dual medical system. In this system, public hospitals provide essential services, while foreign-owned hospitals cater to local and expatriate residents seeking tailored, high-quality treatment options.
John K. Hsiang, chairman of the Jiahui Health executive committee, expressed a desire for the government to facilitate short-term work permits for overseas nurses and technicians. He also suggested that the process for expatriate doctors to obtain professional title recognition could be made more efficient.
Jiahui Health operates the Jiahui International Hospital in Shanghai, which is owned by Hong Kong interests and opened in 2017. The organization also manages outpatient clinics in Shanghai and other cities.
Recently, Parkway Shanghai, the mainland entity of IHH Healthcare, celebrated its 20th anniversary in the Chinese market. Prem Kumar Nair, group CEO of IHH Healthcare, one of the largest private healthcare networks globally, remarked on the impressive vitality and potential of the market.
The local government is progressively implementing new policies to encourage foreign investment in the healthcare sector, which gives us confidence that Parkway Shanghai will encounter even more significant growth opportunities. This statement was made during the announcement of the upcoming flagship ambulatory care center in downtown Shanghai, set to launch in 2025.
This development comes on the heels of the 2023 inauguration of Parkway Shanghai Hospital, a project that required an investment of 1.61 billion yuan ($220 million) and covers an area of 84,400 square meters.