WeDoctor Launches 'Partner Program' Emphasizing Standardization, Localization, and Asset-Light Strategy
After the tumultuous year of 2021, the digital health industry showed signs of recovery at the beginning of 2022, with leading companies taking frequent actions. According to media reports, WeDoctor, a company focused on digital healthcare, recently launched its “Regional Digital Healthcare Community Partner Recruitment Plan” (hereinafter referred to as the “Plan”) internally and openly across the organization, seeking regional digital healthcare community partners nationwide. This indicates that WeDoctor will open up its core standardized capabilities in areas such as expansion, construction, and basic operations of the healthcare community to external parties, potentially shifting from its previous “direct operation” model to a “joint operation” model.
This move is regarded as a strategic follow-up on the business front, following WeDoctor’s completion of its organizational structure upgrade at the end of last year. Media reports indicate that WeDoctor had previously integrated its various business units, capability modules, and regional operations to establish four business hubs centered around the core capabilities of “medical care, pharmaceuticals, insurance, and data.”
It is evident that this organizational restructuring aims to solidify, focus, and enhance core standardization capabilities, while also laying the organizational groundwork for the launch of the “Plan.” Industry experts point out that the shift from a “direct-operated” to a “joint-venture” model reflects WeDoctor’s strategy to leverage localized advantageous resources, accelerate the expansion of its Health Community Consortium model, and transition toward an “asset-light” operational mode. “Standardization,” “localization,” and “asset-light” are likely the key terms underpinning this round of strategic and organizational upgrades at WeDoctor.
Prior to this, WeDoctor had been vigorously promoting the nationwide implementation of its Digital Health Community across provinces and cities in China through self-initiated expansion, self-built infrastructure, and self-operated models.
As early as 2017, WeDoctor launched a pilot project in Jia County, Henan Province, leveraging its internet hospital platform to support the local establishment of an intelligent tiered diagnosis and treatment system spanning county, township, and village-level medical institutions.
In 2019, WeDoctor established a Chronic Disease Health Community in Tai’an, Shandong Province, leveraging its internet hospital platform. This initiative became the first digital chronic disease management service directly procured by a municipal medical insurance authority. Subsequently, Shandong Province promoted the rollout of this model across all 16 prefecture-level cities in the province.
In early 2020, the “Tianjin Primary Care Digital Health Consortium,” led by Tianjin WeDoctor Internet Hospital and involving 267 primary healthcare institutions across the city, commenced operations, establishing a health maintenance system characterized by unified management, shared responsibility, shared benefits, and standardized services.。
In the same year, the Shandong Internet Medical Insurance and Health Service Platform, with WeDoctor as its primary initiator and operator, was launched. It established a comprehensive medical security service system integrating “Internet + medical insurance + healthcare + pharmaceuticals,” and pioneered trials and explorations in Jinan in areas such as medical insurance payment reform, intelligent supervision of medical insurance, and convenient, benefit-oriented medical insurance services for the public.
From grassroots levels to prefecture-level cities, and from provincial capitals to municipalities directly under the Central Government, the implementation of Health Community Consortia (HCCs) faces extremely high barriers, and the requisite standardized capabilities cannot be established overnight. The launch of this “Plan” signifies that standardized pathways have been established for the expansion, construction, and operation of HCCs, while core capabilities on the payment and supply sides have also achieved standardization.
Liao Jieyuan, founder of WeDoctor, once stated that the value of digital healthcare lies not only in its ability to “deliver” medical service capabilities to grassroots levels but also, against the backdrop of global bundled payment systems and medical consortia serving as the primary pathway for healthcare reform, in becoming a driving force for the development of medical consortia, thereby facilitating the achievement of the goal of being “health-centered.”
An analysis of WeDoctor’s exploratory path in building Digital Health Communities reveals that its successful implementation requires not only robust capabilities in healthcare, pharmaceuticals, insurance, and digitalization, but also close collaboration with medical institutions at the level of medical insurance pooling areas, with construction and operations tailored to local conditions.
This necessitates leveraging localized resources to support its expansion and basic operations, a point also evident from the “plan” released by WeDoctor. The plan explicitly states that partners must “possess abundant resources in government public service projects and operational experience within their respective regions.”
Recruiting local partners can effectively address the aforementioned issues, accelerating expansion and implementation across more regions while enabling more efficient construction and operational management.
From another perspective, the “Plan” will also accelerate the conversion of the potential energy generated by WeDoctor’s core standardized capabilities into the kinetic energy driving the implementation of Health Communities.
Public data shows that by the end of 2021, WeDoctor operated more than 30 internet hospitals, 18 of which were integrated with medical insurance payment systems. As essential infrastructure for delivering digital healthcare services, the quantity and quality of these internet hospitals clearly reflect WeDoctor’s accumulation of standardized capabilities in recent years, far outpacing the rollout speed of its Health Community initiatives.
Evidently, if WeDoctor seeks to further expand its market presence, relying solely on the “self-built” model will make it difficult to meet expectations in the short term. The innovative “partnership” model may better incentivize external participation, providing a corresponding mechanism for converting its potential energy into kinetic energy and accelerating the efficient implementation of Digital Health Communities across various provinces and municipalities.
“The Plan” reveals that, for eligible partners, WeDoctor will fully open up the core standardized capabilities developed through its benchmark Digital Health Community cases, supporting partners in designing and implementing localized Digital Health Community models. Meanwhile, it will provide on-demand access to brand resources, corporate public services, and operational management capabilities, helping partners further reduce expansion costs and enhance scientific operational management standards.
From an empowerment perspective, in terms of "insurance," WeDoctor has enabled medical insurance payments across its 18 existing internet hospitals, implemented global budget management and diagnosis-related group (DRG)/capitation payment models in multiple regions, and explored integrated medical insurance-commercial insurance products as well as commercial health insurance offerings such as cancer insurance. In terms of "medical care," WeDoctor operates more than 30 internet hospitals, with revenues from regional internet hospitals in many areas reaching or even surpassing those of large tertiary hospitals. In terms of "pharmaceuticals," WeDoctor owns platforms such as the Haixi Pharmaceutical Trading Center, which supports the Sanming healthcare reform, and has established a pharmaceutical supply system through coordination with both the supply side and payers of medical services. Meanwhile, WeDoctor has developed a comprehensive digital product ecosystem integrating software and hardware, including internet hospital infrastructure, intelligent medical insurance monitoring, digital chronic disease management systems, and smart terminals.
For partners, in addition to gaining standardized capabilities, they will also receive support in areas such as branding and management, thereby addressing the challenge of “having resources but lacking experience” during the implementation of Health Communities. For WeDoctor, this allows the company to focus on building core standardized capabilities, avoiding excessive asset-heavy investments, and ultimately achieving a win-win outcome.
Publicly available data shows that in 2020, WeDoctor’s sales and marketing expenses and general and administrative expenses accounted for 26.6% and 49.4% of its revenue, respectively. The “partnership model” based on an “asset-light” approach not only enhances expansion efficiency but also undoubtedly alleviates capital pressures associated with growth, improves capital utilization efficiency, reduces book losses stemming from market expansion, and optimizes financial statements. This is particularly crucial for WeDoctor as it races toward an initial public offering.
Regarding WeDoctor’s current round of strategic and organizational upgrades, industry insiders have pointed out that, as China’s largest digital healthcare platform, WeDoctor not only needs to continue deepening its core business operations at this juncture, but also must break new ground in organizational design and business models. This will also provide new insights for breakthrough innovation and development within the industry.