Wang Hang, Founder and CEO of Haodf Online: The Next Critical Inflection Point for Internet Healthcare
On June 15, 2022, Wang Hang, Founder and CEO of Haodf.com, was invited to attend VCBeat’s “6th Future Healthcare Top 100 Conference” and delivered a keynote speech titled “The Next Key Point in Internet Healthcare” at the “Healthcare Leaders Summit.”
This year marks the sixth consecutive edition of VCBeat’s “Top 100 Future Healthcare Companies Conference,” themed “China’s Story.” The conference analyzes industry hotspots and interprets development trends in the future healthcare sector from five dimensions: policy orientation, technological frontiers, capital perspectives, industrial innovation, and market demand. Over the past six years, the conference has become a bellwether leading the transformation of China’s healthcare industry.
Wang Hang, Founder and CEO of Haodf.com, analyzed the achievements made in the development of the internet healthcare industry and the opportunities and challenges facing its next stage, based on the industry’s developmental phases. Wang believes that the internet is merely a tool, and its ultimate goal should be to drive qualitative changes in the healthcare sector and reshape traditional medical business processes. Only by focusing intently on resolving bottlenecks within the industry can the core value of internet healthcare be truly realized. Addressing the two most common complaints in the internet healthcare sector—“untimely responses” and “overly simplistic replies”—Wang shared Haodf.com’s recent practices and insights, offering the company’s solutions to these challenges.
Below is the full text of Wang Hang’s remarks (abridged):
Thank you to VCBeat for the renewed invitation. Participating in the Top 100 Forum has become an important annual task for us, as it also drives us to conduct summaries and reflections. Next, I will report on some of the progress and insights made by Haodf.com in practice.
First, let us review the developmental stages of the industry. Prior to 2014, the internet healthcare sector was in its early exploratory phase. The widespread adoption of mobile internet brought internet healthcare applications into households across the nation; however, this stage was primarily characterized by information provision and consultative services, without involving critical clinical processes such as diagnosis and treatment.
From 2015 to 2017, many regions initiated localized pilots for internet-based medical consultations. For instance, the Second Provincial Hospital of Guangdong conducted trials in Guangdong, 39 Health Network in Guizhou, WeDoctor in Wuzhen, and Haodf.com in Yinchuan, all carrying out pilot programs focused on internet-based healthcare services.
In 2018, the pilot program in Yinchuan achieved success, primarily because it aligned internet-based medical consultations with the demand for high-end specialist resources lacking in western China, thereby gaining support from regulatory authorities. In 2018, two Premiers of the State Council conducted field research in Yinchuan and fully recognized the value of the “Yinchuan Model.” Driven by the State Council, the door to internet-based diagnosis and treatment was opened, marking a highly significant and critical policy breakthrough.
In 2020, the pandemic further accelerated the development of the industry. On the regulatory front, multiple policies were introduced to promote industry growth; on the supply side, public hospitals, as the mainstay of the sector, rushed to establish their own internet hospitals; on the capital front, many investors viewed this as a significant innovation opportunity and poured substantial funds into the industry; meanwhile, society at large began to develop a basic understanding of online medical consultations. However, after opening its doors, many industries tend to enter a phase of rapid, and even disordered, growth. By the end of 2020, some irregular “early signs” emerged within the industry, such as the spread of pharmaceutical kickbacks from offline to online channels.
In early 2021, the Government Work Report delivered at the Two Sessions explicitly called for “promoting the standardized development of the Internet + Healthcare industry,” marking the first time that “standardized development” was formally proposed. This issue has also garnered widespread attention across society. In April, some media outlets began to focus on non-compliant practices within the industry; for instance, an article published in Ban Yue Tan magazine exposed the practice of prescribing medications before issuing formal prescriptions, which spurred industry-wide reflection and self-regulation. At the end of October, the Detailed Rules for the Supervision of Internet-Based Diagnosis and Treatment (Draft for Comments) were released. We have observed a significant curtailment of irregular practices in the industry. This is a highly positive trend, conducive to the formal and standardized development of the sector.
In 2022, the most critical issue of concern to society was the pandemic. During the outbreak in Shanghai, we observed that nearly all public hospitals in Shanghai, while announcing restrictions on offline outpatient services, would state, “Our internet hospital remains open for normal consultations.” This actually represents a significant achievement in the development of online diagnosis and treatment, indicating that the entire system of remote medical care had become fully operational. However, new challenges emerged: although many prescriptions could be issued online, medications could not be delivered smoothly to residents’ homes. This phenomenon prompted our reflection.
Online prescriptions are merely the first step in internet-based healthcare delivery; it is a grave misconception to assume that issuing an online prescription signifies the completion of all tasks associated with such services. The internet serves solely as a tool, with its ultimate objective being to drive qualitative transformation across every industry. Therefore, the pivotal mission of digital health lies in reengineering traditional medical business processes.
Where lies the next breakthrough for such a critical mission?
Whether it is third-party internet healthcare platforms or the internet hospitals affiliated with public hospitals, they all face “two ultimate complaints”: untimely responses from physicians and overly brief replies. If these two issues can be resolved, I believe the entire industry will take a significant step forward.
What are the underlying reasons for these two issues? First, it is not a problem of systems or tools. In 2021, our company completed 682 improvement projects of varying scales, yet these two critical issues remained unresolved. Second, it is not a matter of funding. The public-welfare nature of basic healthcare dictates that the growth rate of medical service fees will not be rapid. Given the current state of China’s medical insurance system, a substantial increase in basic medical service fees cannot be achieved overnight. Meanwhile, medical insurance authorities have a fundamental concern: if such convenient online consultation services were covered by medical insurance, utilization would surge dramatically, leading to exorbitant costs for the insurance fund. This core concern inevitably means that medical insurance will continue to adopt global budget controls to manage expenditures on online services.
If the path of medical insurance proves unviable, is it feasible to rapidly increase medical service fees for self-paying patients? I believe this is also unrealistic. The healthcare sector continues to be characterized by its public-welfare orientation, and society at large still regards medical care as a public-service endeavor.
I believe the core issue remains the allocation of physicians’ time and energy. For a competent physician, time and energy are always in short supply. Particularly against the backdrop of an increasingly aging population, China’s medical resources—especially high-quality medical resources—will remain insufficient.
How, then, can such a problem be solved?
Haodf Online has devised a solution: teams. We have been pursuing the path of alleviating the shortage of physician resources through team-based approaches for over three years. Yet, to this day, we are still grappling with issues related to tools and systems. As I mentioned earlier, we implemented more than 600 system-level improvements last year alone. Paradoxically, these enhancements have resulted in increasing system complexity, making it progressively more difficult for physicians to use the platform effectively. The core competitive advantage of physicians lies in the clinical diagnosis and treatment phase, where they deliver high-quality care solutions. However, meeting patients’ growing demand for premium services requires more refined division of labor. Based on this analysis, the key solution becomes clear: we must not only provide technological systems but also assist physicians in establishing a collaborative workflow system that enables effective division of labor, thereby providing them with dedicated assistant support.
Who will serve as the physician assistant?
First, I believe it is unlikely to find such solutions within the existing system; they can only be found outside of it. As the mainstay of the current healthcare landscape, China’s public medical system, by virtue of its status as public institutions, cannot expand rapidly. Therefore, it is necessary to seek new individuals across society who are capable of undertaking this task. In fact, there is no shortage of such candidates. The centralized volume-based procurement policy has forced approximately 3 million pharmaceutical sales representatives to undergo collective career transitions. Each year, a large number of medical graduates enter the workforce, while doctors and nurses in the primary healthcare system also need to transition their roles. All these factors provide a continuous influx of new service capabilities for the physician assistant workforce.
In the next phase, the role of internet healthcare platforms should be to assist physicians in recruiting and training assistants, providing them with professional certification, and evaluating their performance throughout the process. By building medical teams around each key medical decision-maker and improving the efficiency of healthcare resources through task specialization, we can promote high-quality development of healthcare services. This is the key point we have identified for the next stage.
Finally, I hope to reflect with my peers on a critical question: In the development of internet healthcare, what are the key issues for society as a whole? Delivering core value and providing meaningful services to society is precisely what we must strive to achieve in this industry, which is closely tied to life and health.