Xiaoyusan Insurance and Zhibei Pediatrics Forge Strategic Alliance to Pioneer China's Kaiser Permanente Model with Child-Centric Insurance

Xu Han, Chairman of Xiaoyusan Insurance

On January 24, 2017, Xiaoyusan (Little Umbrella) entered into an exclusive strategic partnership with Zhibei Pediatrics. The two parties will collaborate to build a closed-loop ecosystem integrating medical insurance and healthcare services, exploring and establishing a Kaiser Permanente-style model in China.

Furthermore, Xiaoyusan is actively expanding into the broader health and wellness sector, integrating its high-quality resources and leveraging overall synergies to explore the Health Maintenance Organization (HMO) model for health management, thereby introducing a novel user service experience in the field of pediatric outpatient care.

Xiao Yusan, established in late 2014, was co-founded by Xu Han, a graduate of the Hong Kong University of Science and Technology, and Guang Yao, former Product Director at Tencent. Xu Han is a serial entrepreneur in the healthcare, finance, and sports industries; he was nominated as one of Hong Kong’s Top Ten Outstanding Young Persons and is a founding member of the Shenzhen Senior Business Administration Research Association. Guang Yao previously led teams to achieve industry-leading performance across multiple business sectors, including social networking, value-added services, and e-commerce.

Xiaoyusan has long focused on the life and health insurance sector, expressing strong optimism about the development of the broader health industry and making significant strategic investments in the integration of insurance and healthcare. For instance, it launched overseas vaccination insurance services in partnership with Zhuozheng Medical, and introduced corporate health check-up services in collaboration with Meinian Onehealth Healthcare. Such examples of internet-enabled insurance and healthcare integration are numerous. What new synergies will emerge from Xiaoyusan’s latest collaboration with Zhibei?

Given that the Xiao Yu San platform has a large number of corporate users requiring popularization of medical knowledge, we have partnered with Dr. Ou Qian to provide medical service training for the platform’s users, such as first aid training and child healthcare training.

Through repeated interactions, the Xiaoyusan team collaborated smoothly with Dr. Ou Qian and held her in high regard. In May 2016, when Dr. Ou decided to leave the online consultation platform to establish her own pediatric clinic, Zhao Qiang, a senior executive at Xiaoyusan, learned of her plans and chose to partner with her to create a pediatric clinic brand named “Zhibei Pediatrics.”

“During Ousi’s preparation for the ‘Zhibei Pediatrics’ clinic, we were already very familiar with the assembled physician team, having previously established a foundation of collaboration. As a result, subsequent discussions on the partnership between Xiaoyusan Insurance and pediatric medical services proceeded very smoothly,” Xu Han told reporters.

Zhao Qiang, founder of Zhibei Pediatrics, believes that integrating pediatric healthcare with internet insurance will surely generate significant synergy. His expertise in administration and marketing complements Dr. Ou Qian’s limitations in business operations, while Dr. Ou’s professional medical knowledge and healthcare management capabilities fill the gaps in his own skill set.

Leveraging the mutual understanding and strong collaboration between the two teams, matters such as insurance product design and pricing were completed in just three months.

Xu Han, Chairman of Xiaoyusan Insurance, stated that Zhibei Pediatrics represents a significant strategic move for Xiaoyusan Insurance in the broader health sector. Driven by their sustained optimism and focus on this field, both parties will leverage synergistic resources to better support Xiaoyusan’s overall health industry layout. Meanwhile, through deep collaboration with Xiaoyusan Insurance on insurance products, Zhibei Pediatrics can effectively address major healthcare supplementary needs, such as patient cost management and overseas medical consultations.

“Following this collaboration, we will launch our first pediatric insurance product that combines medical insurance with healthcare services. Through this product, we aim to explore the HMO (Health Maintenance Organization) model for health management. Specifically, it integrates internet-based insurance with outpatient pediatric medical services, intervening in users’ health management processes. By implementing differentiated pricing based on distinct user segments, we seek to provide comprehensive, closed-loop health management and protection services.” Xu Han expressed strong confidence in this initiative.

In fact, Xiaoyusan Insurance is a platform that leverages internet big data to design exclusive insurance products for groups with specific, similar attributes. It has consistently focused on person-centric insurance solutions, including personal health insurance, life insurance, and insurance products for children and adults. Since its inception, the company has developed hundreds of insurance products.

Therefore, Xiaoyusan Insurance boasts extensive experience and an outstanding team in both product development and sales. The company currently has a team of nearly 100 employees, including approximately 50 professionals with financial industry experience and around 40 with internet sector experience.

In terms of product design, Xiaoyusan Insurance has also assembled an actuarial team of more than 10 members. Led by Chief Actuary Zhang Xiaojie, the team collects user data from various sources to develop insurance products. Mr. Zhang holds a Master’s degree in Finance from Peking University and previously held senior executive positions in key departments at China Pacific Insurance, including actuarial services, underwriting, and claims adjudication.

“This collaboration with Zhibei Pediatrics is a bold attempt on our part, aiming to create a Kaiser Permanente model with Chinese characteristics,” said Xu Han.

As is well known, the Kaiser Permanente model in the United States integrates health insurance with healthcare delivery, emphasizing “prevention first and combining prevention with treatment.” It has demonstrated advantages in disease prevention and control, health management, and reducing healthcare costs, while also focusing on the supply costs of medical services, as well as the operational costs and efficiency of healthcare institutions. Furthermore, Kaiser Permanente uses medical professionals as its core management unit, integrating health management with clinical care, and has established strong collaborative relationships with the government.

Xiaoyusan Insurance has partnered with Zhibei Pediatrics. From the perspective of their partnership model, medical professionals serve as the primary management unit, integrating children’s health management with clinical diagnosis and treatment to help users reduce healthcare costs.

From the perspective of the Kaiser system, this is a highly integrated healthcare model that combines health insurance with medical services. As such, healthcare providers and insurers form a unified entity of shared interests, allowing surplus funds generated from service delivery to be redistributed within the group. This addresses the lack of financial incentive for cost containment inherent in fee-for-service payment models. Such integrated care enables the provision of comprehensive, one-stop health services to members, ensuring attentive medical support across the entire continuum of care—from disease prevention and diagnosis and treatment to post-illness rehabilitation.

Therefore, this collaboration signifies that Xiaoyusan Insurance and Zhibei Pediatrics will integrate into a unified entity, jointly upholding the concept of safeguarding user health through “insurance + pediatrics.” Consequently, such a partnership requires both teams to achieve alignment in cognition, values, and collaboration to ensure smooth operations in the subsequent stages.

In Ouyang’s view, healthcare institutions and insurance companies have become a unified interest entity, where surplus funds generated after service delivery can be redistributed within the group. This model addresses the lack of financial incentive for cost containment inherent in the fee-for-service payment system. Such integrated healthcare can provide members with comprehensive, one-stop health services, ensuring attentive care from medical professionals across the entire continuum—from disease prevention and diagnosis to post-treatment rehabilitation.

It is foreseeable that, no matter how arduous the road ahead may be, this team at least shares a common goal. As the saying goes, “When people are of one mind, they can move Mount Tai.”