Shenzhen Enacts China's First Local Medical 'Basic Law' with Sweeping Reforms and Patient-Centric Provisions

By Shen Xiaowei

On August 25, the Shenzhen Special Economic Zone Medical Regulations, which underwent four rounds of review over two years, were finally approved at the meeting of the Standing Committee of the Shenzhen Municipal People’s Congress and will come into effect on January 1, 2017. As China’s first local basic medical regulation, it will take the lead nationwide in integrating healthcare reform into the rule of law, using legal frameworks to safeguard Shenzhen’s healthcare reform as it enters its “deep-water zone.”

Basic medical services are part of healthcare servicesThe Most Fundamental and Coreof the section.

At the National Conference on Health and Wellness, General Secretary Xi Jinping explicitly stated: “We must adhere to the basic medical and health services as a public welfare undertaking.”Public Welfare. Li Keqiang also proposed “sharing medical and health resources among all citizens,” with the aim toEquitable AccessTo deepen healthcare reform with the goal of benefiting the public.

Government investment should be prioritized for basic medical and health services, with continuous efforts to improve systems, expand service coverage, and enhance quality, so that the general public has equitable access to systematic and continuous health services, including prevention, treatment, rehabilitation, and health promotion.

Where Is the Government’s Commitment to Basic Coverage Specifically Reflected?

The Regulations specify that the government shall strengthen organizational leadership, increase investment, promote the equalization of basic medical services, ensure the provision of basic medical services by public medical institutions, enhance the standardized development of community health service institutions, and improve their capacity to deliver basic medical services. Appropriate fiscal subsidies shall be provided for basic medical services delivered by various types of medical institutions in accordance with relevant provisions, and preferential policies shall be granted to non-public medical institutions that primarily provide basic medical services. Social forces are encouraged and supported to provide basic medical services to the public. Furthermore, the volume of basic medical services provided by public medical institutions shall account for more than 90% of their total annual medical service volume.

At the National Health and Wellness Conference, five major directions for future healthcare reform were proposed: establishing a tiered diagnosis and treatment system, a modern hospital management system, a universal health insurance system, a drug supply and guarantee system, and a comprehensive regulatory system. Among these,The Tiered Diagnosis and Treatment System Is the Top Priority of Healthcare Reform. The Regulations mark the institutionalization of the hierarchical diagnosis and treatment system reform in Shenzhen.

The Regulations clarify the functions of medical institutions at different levels:Tier 2 and Tier 3 HospitalsPrimarily responsible for providing diagnostic and therapeutic services for emergency, inpatient, and complex critical cases, as well as for the development of key medical disciplines, medical scientific research, and teaching.Primary Healthcare InstitutionsPrimarily responsible for providing basic diagnosis, treatment, rehabilitation, and nursing services for common, frequently occurring, and chronic diseases. It is stipulated that secondary and tertiary hospitals may appropriately restrict the acceptance of non-emergency and non-referred patients, and outpatient physicians may limit the number of appointments to ensure reasonable consultation time for patients.

This regulation helps address issues such as overcrowding in large hospitals, insufficient time for doctor-patient communication, and excessive workloads for healthcare professionals, thereby ensuring the quality of patient care.

After large hospitals implemented appointment quotas, many residents expressed concern that accessing medical care would become more difficult. Lu Yuping, Deputy Director of the Regulations Division of the Shenzhen Municipal Health and Family Planning Commission, stated that the government would also introduce a series of supporting measures to improve the tiered diagnosis and treatment system and build “Initial consultation at primary care level, two-way referral, separate management of acute and chronic conditions, and coordination between upper- and lower-level healthcare institutions” tiered diagnosis and treatment model.

For example, the government will increase investment in primary healthcare institutions and enhance subsidies for basic medical services, improve the family doctor contract service system, and strengthen primary healthcare. It will refine the guiding mechanisms of medical insurance policies to encourage healthcare institutions to shift their focus and resources downward to the grassroots level. Health authorities will establish referral standards and procedures; specialist appointment slots at tertiary hospitals will be prioritized for community health centers, ensuring that patients referred from these centers receive priority in consultation, examination, and hospitalization. In other words, this approach enables the public to enjoy higher medical insurance reimbursement rates and lower out-of-pocket costs when seeking care at primary healthcare facilities. It also ensures timely access to family doctors for initial consultations and facilitates prompt referrals to large hospitals for specialized conditions, thereby enhancing convenience.

Liao Xinbo, an inspector with the Guangdong Provincial Health and Family Planning Commission, stated that while restricting outpatient visits at secondary and tertiary hospitals may seem somewhat impersonal, the ultimate beneficiaries of implementing a tiered diagnosis and treatment system are the citizens of Shenzhen. However, this poses challenges to the Shenzhen municipal government and medical institutions.Need to Improve the Diagnosis and Treatment Capabilities of Primary Healthcare。

It is worth noting that this is aNon-mandatory, but permissiveThe provisions do not mandate that all secondary and tertiary hospitals restrict patient intake; rather, they provide a legal basis for the future implementation of such restrictions in these hospitals.

To address the shortage of medical resources, Shenzhen has further fully liberalized its healthcare sector, encouraging and supporting non-governmental entities to establish medical institutions in accordance with the law.

For private medical institutions, the Regulations feature several key highlights:

First,More Convenient Healthcare Facility Establishment. Streamline the approval process for medical institutions by eliminating pre-establishment approval and practice registration requirements. All restrictions on the quantity, classification, bed capacity, and location distance of privately-run medical institutions are fully abolished, allowing sponsors to independently handle preparatory work. The former two-step approval process, comprising pre-establishment approval and practice registration, is replaced by a single, one-time approval procedure. Furthermore, the previous regulation requiring that clinics be established only by physicians with at least five years of clinical practice experience is revised to permit citizens, legal persons, or other organizations to apply for establishment.

Second,Fairer Market. The Regulations stipulate that medical institutions, regardless of their investment entities or operational nature, shall enjoy equal rights in accordance with the law in areas such as access to medical services, designation as providers under social medical insurance programs, professional title evaluation, institutional grading and assessment, scientific research and teaching, and discipline development.

Third,Encourage the Maintenance of Basic Coverage. The Regulations stipulate that appropriate fiscal subsidies shall be granted to basic medical services provided by various types of medical institutions, based on their functional positioning, service quality, service volume, and the implementation of relevant special programs.

Previously, inconsistent naming rules for for-profit medical institutions and commercial entities resulted in discrepancies between the names listed on their business licenses and their Medical Institution Practice Licenses. Many departments and agencies mistakenly regarded these as two separate legal entities, hindering the smooth conduct of related procedures with industry and commerce, taxation, social security, and banking authorities, thereby severely impairing the normal operations of medical institutions. The new regulations explicitly stipulate that entity qualification registration shall be conducted directly under the name “Shenzhen ** Hospital,” thereby thoroughly resolving the issue of inconsistent naming.

Furthermore, the Regulations establish a registration system for the legal entity status of medical institutions, thereby removing obstacles to future capital operations such as equity transfers and initial public offerings by privately run medical institutions.

The Regulations also provide robust protection for patients’ rights; notably, they require medical institutions to disclose complete medical records to patients within a specified timeframe.

The emergence of doctor-patient disputes often stems fromInformation Asymmetry Between Doctors and Patients, patients and their families often suspect that subjective medical records, such as resuscitation records and progress notes—which are not required to be disclosed to patients under current regulations—have been tampered with by medical institutions. To resolve this conflict, the Regulations explicitly grant patients or their agents the right to consult, photocopy, or reproduce medical records, and medical institutions shall provide such access within six hours during normal working hours.

Lu Yuping, Deputy Director of the Regulatory Affairs Division of the Shenzhen Municipal Health and Family Planning Commission, stated that medical records eligible for copying by patients include both objective and subjective records. This measure not only safeguards patients’ right to information but also helps standardize medical practices and medical record documentation. “In fact, once a medical dispute enters judicial proceedings, hospitals must disclose all medical records to demonstrate the compliance of their medical conduct. So why not disclose them from the outset?” Failure to do so will only exacerbate patients’ distrust of hospitals; therefore, the Regulations have made provisions in this regard.MandatoryRegulations.

“In fact, many medical institutions in China have already made patients’ complete medical records accessible to them, even in the absence of mandatory regulations. ‘Medical institutions in Shenzhen should also be able to do this,’ said Lu Yuping, noting that such transparency helps foster mutual communication and understanding between doctors and patients.”

At the National Conference on Health and Wellness, it was proposed to severely crack down on illegal and criminal activities related to healthcare in accordance with the law, particularly violent crimes against medical personnel, so as to ensure their safety.

Previously, medical institutions were classified as internal security units. The Regulations explicitly stipulate that the premises of medical institutions are public spaces where medical services are provided, and require public security organs to maintain public order within these institutions, prevent and crack down on criminal acts that infringe upon the personal safety of medical personnel, other staff members, and patients, or disrupt the normal operational order of medical institutions.

What is the difference between “public places” and “internal security units”?

Under the provisions of the Public Security Administration Punishments Law regarding disturbances to public order, penalties imposed on “internal security units” must meet the criterion of “disrupting order to the extent that work, production, business operations, medical services, teaching, or scientific research cannot proceed normally”; whereas for “public places,”Merely constituting "disruption", penalties may be imposed without any additional conditions.

Furthermore, the Regulations explicitly prohibit activities such as “medical disturbances,” “scalping of appointment slots,” “medical touting,” and “malicious avoidance of medical payments,” thereby enhancing the prevention and crackdown on healthcare-related illegal and criminal acts, safeguarding patients’ legitimate rights to seek medical care, and ensuring the rational utilization of medical resources.

“Designating hospitals as public spaces is beneficial for handling doctor-patient disputes, providing us with a clear legal basis for law enforcement. The regulations explicitly require public security organs to handle such cases promptly and in accordance with the law,” stated Wu Jianjun, Deputy Director of the Lianhua Police Station in Futian District. He noted that in the past, public security authorities mostly relied on mediation between both parties to resolve incidents of medical disturbances at hospitals. With the nature of hospitals clarified as public spaces, individuals who disrupt order can now be detained in accordance with relevant regulations.

Physicians’ multi-site practice has become an administratively endorsed and supported measure in China; however, it is regrettable that our laws and regulations have not kept pace.

The Regulations legalize multi-site practice for physicians from a legal perspective. The Regulations clearly state that,Physicians Registered in Shenzhen，Filing with the Municipal Physicians Association is sufficient., they may practice at multiple medical institutions;Physicians from Outside Shenzhen Practicing in ShenzhenNo change in practice registration is required., they may practice in Shenzhen medical institutions upon completion of the filing procedures.

This facilitates Shenzhen’s recruitment of outstanding medical professionals from outside the city. By streamlining the filing procedures for physician practice registration and abolishing caps on the number of practicing physicians, Shenzhen can fully mobilize and optimize its physician workforce, thereby enhancing the overall quality of medical care in the city.

The Regulations also stipulate the specific advance notice period required for physicians to obtain informed consent from patients. This provision provides robust safeguards for protecting patients’ rights and interests, ensuring that patients have adequate time for careful consideration before undergoing medical procedures. Furthermore, the Regulations clearly define the specific measures and procedures for patients to request copies of their medical records, thereby addressing previous legislative gaps in this area of medical practice.

At the National Conference on Health and Wellness, Xi Jinping emphasized the need to comprehensively establish a health impact assessment system, improve the construction of population health information service systems, and promote the application of big data in health and medical care.

Electronic medical records (EMRs) can be disseminated and shared via the internet, forming the foundation of “Internet + Healthcare.” The “Internet + Healthcare” model facilitates the advancement of universal health information services and smart healthcare services. By leveraging population health information platforms to establish and refine electronic health record (EHR) and EMR databases, it provides big health data and information technology support for the development of remote services, mobile healthcare, family doctor services, and other initiatives.

Under the Electronic Signature Law, the use of electronic signatures requires mutual agreement between the parties involved. However, it is impractical for medical institutions to reach such agreements with every patient, and there is a lack of clear legal basis regarding the legal validity of electronic medical records.

The “Regulations” break new ground through legislation, explicitly stipulating that electronic medical records meeting the specified requirements are equivalent to medical records in other forms.have equal legal effect; reliable electronic signatures in electronic medical records and handwritten signatures or seals on other medical recordsHave Equal Legal Effect; and authorize the municipal health administrative department to formulate measures for the administration of electronic medical records.

The implementation of these provisions provides a legal basis for medical institutions to create and use electronic medical records and electronic signatures, which can significantly reduce the workload of physicians and will alsoThe Development of "Internet + Healthcare"Break through key bottlenecks to usher in a spring of leapfrog development.

“The Regulations” stipulate the establishment and improvement of a credit system for the medical industry, recording the professional conduct of medical institutions and health professionals, and regularly disclosing such information to the public.

《Regulations》Drawing on the cumulative demerit point system for motor vehicle driversBy implementing a cumulative point system for medical institutions and physicians, and linking these points to administrative penalties, the supervision of professional conduct is transformed from isolated “points” into a continuous “line.” Medical institutions and physicians are akin to holding a “driver’s license”; in addition to administrative penalties imposed in accordance with the law for violations, demerit points will be recorded. When accumulated points reach a specified threshold, administrative penalties such as warnings or orders to suspend practice will be imposed, with the most severe penalty being revocation of the practicing license.

The Regulations stipulate that physicians practicing in Shenzhen shall apply to the Shenzhen Medical Doctor Association for practice registration, a provision that replaces the previous requirement of registration by administrative authorities and leverages the role of self-regulatory industry organizations.

The Regulations explicitly outline the characteristics of management by industry self-regulatory organizations and encourage medical institutions and health professionals to join such bodies. The Regulations clearly define the responsibilities of these self-regulatory organizations, including regulating physicians’ clinical practice and conduct, facilitating professional exchanges, conducting public science education, and imposing disciplinary actions on members. This progressive approach represents a positive step toward strengthening physician oversight by transitioning from purely administrative management to a collaborative model involving both administrative and industry-based governance.

In fact, countries that implement industry organization registration internationally all require physicians to join professional associations; the "Regulations" also draw on the system of "mandatory association membership" for lawyers and certified public accountants. According to a legislative public opinion survey, 74.10% of medical personnel believe it is necessary to join professional association organizations.