Breaking: Starting April 1, Practicing Doctors Are Allowed to Open Hospitals and Clinics

Just now, the National Health and Family Planning Commission issued "Order No. 12 of the National Health and Family Planning Commission of the People's Republic of China," announcing the adoption of the Decision on Amending the Detailed Rules for the Implementation of the Regulations on the Administration of Medical Institutions, which shall come into force on April 1, 2017.

The "Detailed Rules for the Implementation of the Regulations on the Administration of Medical Institutions" serve as a crucial instrument for health and family planning administrative departments at all levels to fulfill their supervisory and managerial duties over medical institutions in accordance with the law, and constitute an important basis for the lawful establishment of medical institutions and the standardized practice of medical institutions at all levels and of all types.

In accordance with the decisions and arrangements made by the CPC Central Committee and the State Council in recent years, structural supply-side reforms in the medical field have been continuously deepened. Reform measures such as streamlining administration and delegating power, and combining deregulation with regulation have been implemented. The National Health and Family Planning Commission issued the "Decision on Amending the Detailed Rules for the Implementation of the Regulations on the Administration of Medical Institutions," which requires further adjustments to provisions concerning the classification of medical institutions, eligibility criteria for applicants establishing medical institutions, architectural design review of medical institutions, and information management of medical institutions.

The specific adjustments to the new version of the "Detailed Rules for the Implementation of the Regulations on the Administration of Medical Institutions" are as follows:

First, the "Implementation Rules" have added categories of medical institutions.

To advance the development of a tiered diagnosis and treatment system and promote regional sharing of medical resources, from late 2016 to February this year, China’s National Health and Family Planning Commission successively issued basic standards and management specifications for various types of medical institutions, including medical laboratory testing centers, pathological diagnosis centers, medical imaging diagnosis centers, hemodialysis centers, and palliative care centers. These measures aim to further improve the healthcare service system and actively broaden channels for social forces to participate in healthcare provision.

Accordingly, Article 3 of the Implementing Rules has been amended to add a provision that includes additional categories of medical institutions, namely “medical laboratory testing centers, pathology diagnosis centers, medical imaging diagnosis centers, hemodialysis centers, and palliative care centers.”

Furthermore, in accordance with the Guiding Opinions on Optimizing and Integrating Resources for Maternal and Child Health Care and Family Planning Technical Services (Guo Wei Fu You Fa [2013] No. 44), municipal- and county-level maternal and child health care institutions shall, in principle, be merged with family planning technical service institutions to establish “Maternal and Child Health Care and Family Planning Service Centers” at the municipal and county levels. Accordingly, Item 2 of Article 3 of the Detailed Implementation Rules has been amended to include “Maternal and Child Health Care and Family Planning Service Centers.”

Second, the Implementation Rules have relaxed the eligibility requirements for applicants establishing medical institutions, allowing in-service medical personnel to establish such facilities.

The Implementation Rules have deleted the provision in Article 12, Paragraph 1, Item 3, which stated that “medical personnel who are currently employed by medical institutions, have retired due to illness, or are on unpaid leave shall not apply to establish medical institutions.” Following this amendment, the eligibility criteria for applicants seeking to establish medical institutions under the Implementation Rules will focus primarily on medical quality and safety, with an emphasis on reviewing the applicants’ conditions and qualifications for operating medical facilities. This change is conducive to fully leveraging the professional expertise of physicians and stimulating their enthusiasm for entrepreneurial ventures; promoting private investment and accelerating the development of privately run medical institutions; and further improving the healthcare service system to foster a diversified landscape of medical service provision, thereby better meeting the public’s diverse healthcare needs.

This change means that in-service medical personnel can now apply to establish medical institutions. The state has finally "relaxed" restrictions on in-service physicians applying to set up medical facilities, and further encourages doctors to start their own businesses, leveraging their professional expertise. As public hospitals gradually transition from a traditional staffing quota system to a record-filing system, medical personnel are regaining their status as free agents. Coupled with the national promotion of multi-site practice, the day when doctors can simultaneously hold hospital positions and operate their own clinics is just around the corner.

Third, "The architectural design of medical institutions must be reviewed and approved by the approving authority before construction can commence."

Article 18 of the original Implementation Rules stipulated that “the architectural design of a medical institution must be reviewed and approved by the approving authority responsible for its establishment before construction may commence.” Given that the architectural design of medical institutions involves multiple departments, including planning, housing and urban-rural development, environmental protection, fire safety, and health and family planning, and in accordance with the requirements for reform of the administrative examination and approval system, each department shall assume its respective responsibilities, promote parallel processing of approvals, and not impose mutual preconditions for approval. Therefore, Article 18 of the Implementation Rules has been amended to read: “The architectural design of a medical institution must be reviewed and approved by the relevant examining and approving authorities in accordance with the requirements of laws, regulations, and rules before construction may commence.”

Fourth, implement the electronic license system

Article 38 of the “Detailed Implementation Rules” is amended to read: “Health and family planning administrative departments at all levels shall adopt information-based measures, such as electronic licenses, to implement full-process management and dynamic supervision of medical institutions. Relevant administrative measures shall be formulated separately.”

The National Health and Family Planning Commission has launched pilot programs for electronic licenses for medical institutions, physicians, and nurses in the Beijing-Tianjin-Hebei region. These initiatives aim to explore improvements to registration models, streamline approval processes, and promote the establishment of a comprehensive, dynamic, and efficient management system, yielding initial successes. The next step involves establishing a nationwide electronic licensing system to further advance this work.