13 Chinese Government Departments Issue Joint Notice to Accelerate 'Streamlining, Regulation, and Service' Reforms in Elderly Care Sector and Encourage Social Capital Participation

VCBeat learned from the website of the Ministry of Civil Affairs that, in order to quickly break through the bottlenecks hindering the development of the elderly care service industry, stimulate market vitality and unlock the potential of private capital, and promote social forces to gradually become the mainstay in developing the elderly care service industry, the Ministry of Civil Affairs, the National Development and Reform Commission, the Ministry of Public Security, the China National Committee on Ageing, and other departments jointly issued the “Notice on Accelerating the Reform of Streamlining Administration, Delegating Power, and Improving Services in the Elderly Care Service Industry” (hereinafter referred to as the “Notice”).

The “Notice” requires further mobilization of social forces to participate in the development of the elderly care service industry, reduction of institutional costs for market entry, creation of a fair and standardized development environment, and cultivation and establishment of a group of branded, chain-operated, and large-scale elderly care service enterprises and social organizations.

The “Notice” requires strengthening efforts to streamline administration and delegate power. It mandates standardizing the approval and construction filing procedures for elderly care service investment projects, and simplifying and optimizing the relevant approval procedures for elderly care institutions.

“The Notice” requires a change in the method of distributing operational subsidies. Localities should gradually shift the distribution of operational subsidies for elderly care service institutions from subsidizing “bricks” (infrastructure) and “beds” to subsidizing “people,” with subsidies issued based on the actual number of elderly individuals served.

The “Notice” proposes encouraging localities to adopt models such as public construction with private operation, whereby elderly care service facilities owned by the government are entrusted to enterprises or social organizations for operation. It also encourages the establishment of elderly care investment funds that operate independently through market-oriented approaches such as equity investment, so as to attract non-governmental resources into the infrastructure and service sectors of elderly care.

Civil Affairs Departments (Bureaus), Development and Reform Commissions, Public Security Departments (Bureaus), Finance Departments (Bureaus), Land and Resources Authorities, Environmental Protection Departments (Bureaus), Housing and Urban-Rural Development Departments (Construction Committees, Construction and Transportation Committees, Planning Commissions, Municipal Administration Committees), Health and Family Planning Commissions, Administrations for Industry and Commerce, Food and Drug Administrations, Banking Regulatory Bureaus, and Offices on Aging of all provinces, autonomous regions, and municipalities directly under the Central Government; the Shanghai Head Office of the People’s Bank of China, its branch offices, Business Management Departments, central sub-branches in provincial capital (or regional capital) cities, and central sub-branches in sub-provincial cities; and the Civil Affairs Bureau, Development and Reform Commission, Public Security Bureau, Finance Bureau, Land and Resources Bureau, Construction Bureau (Environmental Protection Bureau), Health Bureau, Population and Family Planning Commission, Administration for Industry and Commerce, Food and Drug Administration, and Office on Aging of the Xinjiang Production and Construction Corps:

To expedite the removal of bottlenecks hindering the development of the elderly care service industry, stimulate market vitality and unlock the potential of private capital, and promote social forces to gradually become the mainstay in developing this sector, notice is hereby given on matters concerning the advancement of reforms to streamline administration, delegate power, strengthen regulation, and optimize services in the field of elderly care services.

I. General Requirements

Fully implement the spirit of the 18th National Congress of the Communist Party of China and the Third, Fourth, Fifth, and Sixth Plenary Sessions of the 18th Central Committee, in accordance with the State Council’s deployment requirements for deepening reforms to streamline administration, delegate power, improve regulation, and optimize services; adhere to a problem-oriented approach and innovate work methodologies,Further mobilize social forces to actively participate in the development of the elderly care service industry, reduce institutional costs for market entry, foster a fair and standardized development environment, and cultivate and build a group of branded, chain-operated, and large-scale elderly care service enterprises and social organizations.

The guiding principles for advancing the reform of streamlining administration, delegating power, and improving services in the elderly care service industry are:

— Streamlining and optimization of processes. Integrate the construction approval procedures for elderly care investment projects, optimize the approval conditions for elderly care institutions, simplify administrative steps, accelerate business process reengineering, and clarify standards and time limits. In principle, submission of application materials shall no longer be required if there is no basis in laws, regulations, or rules, or if the relevant application information can be obtained through information sharing with other departments.

——Lawful and Compliant Management. Strictly adhere to laws and regulations, uphold rule-of-law thinking and approaches, standardize the management of the elderly care service industry, ensure the quality of elderly care services and products, and foster a safe, convenient, and trustworthy service environment.

— Convenient and efficient services. Expand service channels, innovate service methods, and establish and improve systems such as first-inquiry responsibility, one-time notification, parallel processing, and time-limited completion. Promote the seamless integration of approval and services among administrative departments to make it more convenient for the public to handle affairs and smoother to start businesses.

— Effective policy alignment. Strengthen service orientation, promote the mutual integration and practical implementation of various support policies, enhance the targeted nature and operability of policies, effectively address key and difficult issues, and improve service innovation capabilities.

II. Intensify Efforts to Streamline Administration and Delegate Power

(1)Standardize the approval and construction procedures for investment projects in elderly care services.

1. Integrate the approval process. The approval process for investment and construction projects of elderly care service facilities shall be integrated into four stages: project approval (or project verification, filing), land use approval, planning application, and construction permit.

2. Clarify the lead departments. The development and reform department is responsible for leading the project approval (or project verification and filing) stage. The land and resources department is responsible for leading the land use approval stage. The urban and rural planning department is responsible for leading the planning application stage. The housing and urban-rural development department is responsible for leading the construction permit stage.

3. Implement parallel approval. Break down departmental barriers, reduce and streamline the prerequisites for approval items. In each approval stage, the lead department shall centrally accept application materials, organize other approving departments to conduct parallel approvals, supervise and coordinate the approval progress, complete the approvals within the time limits specified by the process, and uniformly notify the project construction entity of the approval results.

4. Explore the implementation of regional assessments for elderly care service construction projects. For areas that comply with already-approved regulatory detailed plans, individual elderly care investment projects within these areas will no longer be subject to assessment and review regarding traffic impact, water impact, seismic safety, and other related aspects.

(II)Simplify and optimize the approval procedures for elderly care institutions.

5. Streamline the application materials for establishing elderly care institutions. When applying for a license to establish an elderly care institution, if the applicant can provide proof of property rights for the service facilities, it is no longer required to submit the completion acceptance certificate from the construction unit.

6. Food business operations are subject to the “business license first, permit second” policy. Elderly care institutions engaging in catering services shall first obtain a business license and other legal entity qualifications in accordance with the law, and then apply for a Food Operation Permit.

7. Streamline Environmental Impact Assessments. Implement classified management for environmental impact assessments of elderly care institutions, and apply a filing-based management system to those with minimal environmental impact that are required to submit an Environmental Impact Registration Form.

8. Exemption from fire protection design review and acceptance procedures for certain institutions. For buildings constructed and put into use before September 1998 that have not undergone any alterations or expansions (including interior and exterior decoration, building insulation, or change of use), there is no need to undergo fire protection design review, fire protection acceptance, or filing procedures. Elderly care institutions and facilities with a construction area of less than 300 square meters or an investment of less than RMB 300,000 are exempt from the filing procedures for fire protection design and completion acceptance. Other elderly care institutions shall handle fire protection review, acceptance, or filing procedures in accordance with the law.

9. Support accelerating the improvement of property rights registration procedures for service venues.For newly established elderly care institutions, or for applications to establish such institutions using existing buildings that involve real estate registration, the real estate registration authorities shall accelerate the handling of real estate registration procedures in accordance with the law. By implementing measures such as “first-inquiry responsibility” and “one-stop service,” these authorities shall provide efficient and convenient real estate registration services to support the application for establishment and construction of elderly care institutions. For cases where relevant procedures are incomplete and real estate registration cannot be processed temporarily, support shall be provided to expedite the completion of the necessary procedures in accordance with the law, thereby enabling subsequent registration.

III. Strengthening Supervision and Management Capabilities

10. Enhance administrative regulatory capacity. Civil affairs departments at all levels shall strengthen guidance, supervision, and management of elderly care services, while other relevant departments shall implement oversight in accordance with their respective responsibilities. Strengthen regulatory capacity building, integrate and augment workforce resources, and enhance professional training to ensure that all matters are properly managed and responsibilities are clearly assigned.

11. Standardize administrative law enforcement practices. Implement the “double random, one public” regulatory model, formulate guidelines for administrative law enforcement in the management of elderly care institutions, and strictly handle administrative violation cases involving elderly care institutions in accordance with statutory authority and procedures. Proactively disclose the procedures for handling violation cases, and clearly inform the parties involved of the facts, reasons, legal basis, and their legally entitled rights regarding administrative penalty decisions. Information on administrative penalties imposed on elderly care service enterprises shall be publicly disclosed through the National Enterprise Credit Information Publicity System and the “Credit China” website in accordance with the law.

12. Establish a social evaluation mechanism. Leverage the roles of industry self-regulation, public reporting, and media oversight. Encourage the government to purchase services from third-party institutions to conduct regular comprehensive evaluations of elderly care service providers, covering aspects such as personnel, facilities, services, management, and reputation. The evaluation results shall be made public.

13. Unimpede Complaint Channels. Relevant departments shall establish a system for reporting and lodging complaints regarding elderly care services, and shall promptly verify and address such reports and complaints upon receipt.

IV. Enhancing Government Service Standards

(1) Strengthen the disclosure of government information.

14. Timely Release of Supply and Demand Information. All localities shall proactively and promptly publish information regarding the supply and demand of local elderly care services, to facilitate access, inquiry, and utilization by social forces and the public.

15. Enhance the Disclosure of Licensing Information. Innovate methods for government transparency. Localities should generally disclose, at service counters and on government affairs websites, all matters related to administrative licensing for the establishment of elderly care institutions as stipulated by laws, regulations, and rules, including the legal basis, conditions, quotas, procedures, time limits, list of required materials, and model application forms. Administrative licensing information concerning elderly care service enterprises shall be publicly disclosed in accordance with the law through the National Enterprise Credit Information Publicity System and the "Credit China" website.

16. Strengthen policy publicity and guidance. Local authorities shall effectively publicize and explain relevant laws, regulations, and policy measures to natural persons, legal entities, or other social organizations intending to establish elderly care institutions or develop community-based home care services. Localities may develop standardized preparatory guidelines to facilitate applicants in completing relevant administrative licensing procedures with the appropriate departments.

17. Achieve information sharing for registration. In accordance with the principles of centralized collection, timeliness and accuracy, and shared utilization, actively carry out the unified collection and public disclosure of information on for-profit elderly care institutions, specify the detailed content of the data to be collected, establish a data verification mechanism, and promote collaborative supervision and credit-based constraints.

(2) Enhance the government’s capacity to precisely promote the development of elderly care services.

18. Reform the method of distributing operational subsidies.The method of issuing operational subsidies to elderly care service institutions across various regions should gradually shift from subsidizing “bricks” (infrastructure) and “beds” (capacity) to subsidizing “heads” (individuals), with subsidies distributed based on the actual number of elderly individuals served.Subsidy standards should be appropriately skewed toward services for disabled elderly individuals, and for-profit elderly care institutions providing the same services should enjoy subsidy policies equivalent to those granted to non-profit elderly care institutions.

19. Innovate the supply models of service facilities.Secure funding through multiple channels and strengthen the construction of integrated community-based service facilities for the elderly. In existing residential (sub)districts lacking supporting elderly care service facilities, local authorities shall provide such facilities through measures such as asset swaps, leasing, or purchase. Localities are encouraged to adopt models such as publicly built and privately operated arrangements, entrusting the operation of government-owned elderly care service facilities to enterprises or social organizations.

20. Increase the intensity of preferential support measures.Systematize the scope of government-procured community-based home care services for the elderly, include them in the Government Procurement of Services Guidance Catalog, and cultivate and support qualified suppliers to enter the market.

21. Promote Chain Operations. Further improve systems and standardize processes, encourage elderly care institutions and service enterprises to establish branches in accordance with the law, and achieve chain-based, large-scale, and branded development.

22.Encourage the establishment of pension investment funds that operate independently through market-oriented approaches such as equity investments, to attract social capital into the infrastructure and service sectors of elderly care.

V. Work Measures

(1) Strengthen organizational leadership. All regions and relevant departments must attach great importance to the reform of streamlining administration, delegating power, and improving services in the elderly care service industry. Principal leaders shall take personal charge and promptly coordinate to resolve major issues arising during the reform process. Departments including development and reform, civil affairs, public security, housing and urban-rural development, and industry and commerce administration shall fulfill their respective responsibilities and collaborate closely to ensure the smooth advancement of the reform. Fully leverage the organizational, coordinating, guiding, and supervisory functions of agencies responsible for aging-related work. Departmental rules and policy measures that are inconsistent with the spirit of the reform shall be revised and improved in a timely manner.

(II) Strengthen Supervision and Inspection. All regions and relevant departments shall conduct timely supervision and inspection of the progress in the reform to streamline administration, delegate powers, improve regulation, and upgrade services in the elderly care service industry, and ensure smooth channels for public oversight. Regions that demonstrate proactive engagement and achieve significant results shall be commended and incentivized; those with inadequate implementation or delays in advancing the reform shall be held strictly accountable.

(III) Strengthen publicity and guidance. All regions and relevant departments must fully recognize the significance of advancing the “decentralization, regulation, and service” reforms in the elderly care service industry, actively promote effective practices, promptly address and respond to public concerns, and foster a favorable social atmosphere of understanding and support for the reforms.