Integration of Telemedicine and Commercial Insurance as a Breakthrough for Tiered Diagnosis and Treatment: Insights from Lu Qingjun of the National Health Commission

During its exploratory phase, the internet’s integration with healthcare followed a highly tortuous path. What was the reason? We conflated the concepts. What constitutes “medical care,” and what constitutes “service”? Although medical care falls under the health services industry, it is fundamentally distinct from general services.

Medical care is a proactive service provided by healthcare professionals to patients, guided by their scientific knowledge. Therefore, there must be legal boundaries for their qualifications and conduct, strict regulatory oversight, and a commitment to public welfare.

In contrast, services are tailored to patients’ needs and may become consumer commodities. Therefore, as a proactive care practice involving clinical decision-making authority, healthcare must not be driven by uninformed service demands lacking a knowledge base. This is the key distinction between healthcare and services.

Based on this concept, telemedicine carries its own distinct meaning. Over the past half-century, the development of communication technologies, combined with information technology methods, has given rise to an entirely new model—one that breaks through barriers of distance, space, and time. Therefore, telemedicine is not merely an internet-based medical technology; more importantly, it represents a fundamentally new model.

Patients look to the internet for more convenient access to medical care and health insurance coverage. Companies are primarily focused on market share and profit models, whereas physicians have different priorities. Physicians are concerned with improving work efficiency, serving more patients, ensuring the quality and safety of medical care, and safeguarding themselves against liability risks. The government’s perspective is entirely different: it focuses on how to invest in public welfare, whether the healthcare security system is sound, and how to provide the public with more robust social safeguards.

Supply and demand are inherently contradictory. To clarify the dynamics within this industry, in 2014, the National Health and Family Planning Commission issued Document No. 51, which strictly stipulated that telemedicine constitutes medical practice conducted between healthcare institutions and imposed rigorous regulations on all technical models.

Against this backdrop, numerous medical apps have emerged, only to quickly fade away. What is the reason? A lack of rationality. While ensuring legality, has consideration been given to whether top-tier experts have the time to provide patient care via apps? Is there awareness of whether these apps comply with healthcare regulatory requirements? Therefore, beyond mere legality, what matters more is rationality: adherence to medical principles, economic principles, and, most importantly, social principles, grounded in a realistic and viable sociocultural context.

Establishing a Telemedicine System: Since telemedicine is defined as a medical practice, it must adhere to strict technical standards. First, the information platform must comply with these technical standards to ensure data security and quality. More importantly, the management protocols for medical practices must conform to all applicable regulatory requirements. Only by establishing a telemedicine operational model that seamlessly integrates with the actual workflows of hospitals can we effectively enhance work efficiency, improve healthcare quality, and ensure patient safety.

Therefore, since the formal establishment of the telemedicine system in 1998, after extensive technological exploration, the National Health and Family Planning Commission officially established the Telemedicine Management and Training Center in 2012. Its primary objectives were to establish a national demonstration framework, develop and research medical standards and management regulations, implement a nationwide medical quality control system, and train grassroots physicians in clinical diagnosis and treatment capabilities. Currently, the telemedicine platform network covers 32 provinces and municipalities, more than 2,000 hospitals, and has enabled clinical services across over 60 medical specialties.

During the demonstration, the National Health and Family Planning Commission placed significant emphasis on guiding big data initiatives by establishing an integrated remote healthcare data management platform. This platform enables users to log in via web browsers anytime and anywhere, allowing medical experts to leverage their fragmented time to fulfill clinical duties. Furthermore, it integrates process management, quality control, and the three-tier ward round system into the remote healthcare platform.

Telemedicine is not merely about consultations and clinical visits, nor is it simply about providing guidance for patient referrals; more importantly, it represents an enhancement and integration across all hospital operational scenarios. Hospital disciplines—including medical care, education, scientific research, and disease prevention—must be implemented through telemedicine platforms. Only with such platforms can genuine disciplinary support and collaboration between lower-tier and higher-tier hospitals be achieved.

Commercial insurance has always played a vital role in healthcare. The national framework for medical expense coverage is structured around three parties: out-of-pocket payments by patients, partial government subsidies, and commercial insurance, which essentially leverages social pooling mechanisms to provide financial support for critical and chronic diseases.

However, commercial insurance faces significant bottlenecks, not only in China but also abroad. How can numerous commercial insurance products encourage patients to voluntarily pay out-of-pocket? When policyholders endlessly utilize their benefits after purchasing insurance, how can costs be controlled? For health insurance companies, effectively curbing resource waste and controlling expenses to ensure that premiums are spent where they matter most, as well as integrating health insurance with medical practices, are critical issues in the collaboration between healthcare institutions and insurers.

What Drives the Appeal of Commercial Health Insurance? The most straightforward factor is its flexibility, while the greatest challenge lies in developing high-quality resources—specifically, how to engage top-tier experts and how to leverage commercial insurance to cover substantial gaps left by basic health insurance. Commercial health insurance aims to address issues that basic medical coverage cannot, such as those involving advanced medical technologies, health management services, and innovative or specialty pharmaceuticals.

However, the disease coverage catalog of commercial insurance currently overlaps precisely with that of basic medical insurance. In this context, what strategic direction should commercial insurance pursue?

In terms of cost containment, commercial health insurance is lacking. Basic medical insurance can control the prices of major medications and services through government intervention, whereas commercial insurance cannot. When there is an overlap between the reimbursement lists of basic medical insurance and commercial insurance, it undermines the public’s incentive to purchase commercial health insurance.

Therefore, under these circumstances, the only option available to commercial insurers is to leverage all commercial sales strategies to expand insurance coverage. Integrating disease-specific or single-disease insurance with telemedicine to achieve cost containment for individual conditions may present an innovative opportunity for the industry.

In the United States, physicians undergo rigorous standardized training, resulting in a largely homogeneous level of competence regardless of whether they practice in rural areas, urban centers, or academic institutions. In contrast, in China, there is a world of difference after twenty years between medical school graduates assigned to county-level hospitals and those assigned to provincial-level hospitals.

The heterogeneity in physician training has led to educational deficiencies for many primary care doctors during their professional development, resulting in misdiagnoses, inappropriate treatments, and even ineffective therapies. This erodes patients’ trust in primary healthcare institutions and physicians. More importantly, the absence of a rational referral system—unlike the family physician model in the United States—means that patients seek care wherever gaps exist, inevitably leading to significant amounts of redundant and excessive medical services. Consequently, mutual recognition of test results remains difficult, making duplicate testing unavoidable. Furthermore, there is a lack of effective guidance for seeking medical care; patients tend to distrust doctors and hospitals, placing their confidence instead in friends and relatives. This reflects a broader deficiency in proper patient navigation and an orderly healthcare-seeking process.

The integration of commercial insurance with telemedicine, further combined with health insurance and critical illness insurance, enables orderly healthcare management, referrals for severe cases, and structured medical consultations based on level, hierarchy, and disease progression. This constitutes a core component of the tiered diagnosis and treatment system.

For critical care referrals, many critical illness insurance products market this feature as a commercial selling point; however, its true significance lies in safeguarding lives. Establishing a critical care referral system is not merely about addressing discharge issues, but more importantly, about ensuring access to life-saving channels. Another role of telemedicine is third-party assessment. In the context of medical insurance claims and beneficiaries, remote experts have no vested interests. Consequently, their decisions are based solely on medical knowledge and scientific judgment, allowing them to conduct impartial and fair evaluations as independent third parties. This makes telemedicine a crucial basis for cost containment.

Beyond the redistribution of physicians and appointment slots, tiered diagnosis and treatment fundamentally involves the allocation of financial resources according to its hierarchical structure. By leveraging a telemedicine collaboration platform to establish specialized medical consortia, hospitals can integrate other collaborative entities, extending their reach from provincial and municipal regional centers down to primary care facilities. This model also directly engages public health institutions and private hospitals. Crucially, such platforms integrate social resources, basic medical insurance, commercial insurance, and public charitable funds. This creates a multi-dimensional collaborative framework that underpins the three-tier referral system.

When managing patients with chronic diseases, initial care can be provided by general practitioners at primary healthcare facilities. In case of emergencies, patients are transferred to secondary hospitals for the treatment of common and frequently occurring diseases; those with more severe conditions are referred to large tertiary Grade A hospitals. Beyond acute-phase treatment and emergency care, patients can be transferred to secondary hospitals or community health centers for rehabilitation during the recovery phase. This approach not only conserves medical resources but also reduces the burden on patients, particularly non-medical costs associated with healthcare access, such as travel expenses, family caregiving time, and lost wages. The establishment of this collaborative care system should be driven by disease-specific programs. Interdisciplinary collaboration is less critical; the priority lies in addressing the full continuum of care for patients with a single specific disease.

According to WHO statistics, the ratio of healthcare expenditure in China on prevention, treatment, and emergency critical care is 1:8.5:100. How should this figure be interpreted? By implementing effective health management and chronic disease management, and by prioritizing disease prevention to enable early detection and early treatment, every yuan invested upfront can save 8.5 yuan in hospitalization costs and 100 yuan in emergency critical care expenses, yielding significant benefits.

Technology can reshape human behavior. Telemedicine will inevitably establish a collaborative framework and build an information superhighway for healthcare security. Only through the synergy of medical care, pharmaceuticals, and health insurance—the “Three Medical Systems”—can we establish a tiered healthcare delivery system based on patient needs and quality standards. With the support of this tripartite coordination, patients will be more willing to seek medical attention early and at primary care facilities. As patient volume at the grassroots level increases, government investment in infrastructure will follow. In particular, commercial insurance can penetrate the primary care sector through this collaborative system, thereby encouraging patients to change their healthcare-seeking habits, prefer primary care settings, and truly implement a tiered diagnosis and treatment system. Therefore, commercial insurance must focus on chronic disease insurance and health insurance, using these products to underpin and support critical illness insurance.

Therefore, only when such a system is established and telemedicine along with the three-tier linkage mechanism achieves a certain scale can hierarchical diagnosis and treatment be truly realized. This will enable primary care institutions to assume greater responsibility for public health services, chronic disease management, and health maintenance. County-level secondary hospitals will handle common and frequently occurring diseases as well as the promotion of new technologies, thereby allowing specialists at large tertiary Grade A hospitals to devote more time to researching and developing new technologies, diagnosing and treating complex and critical conditions, and training high-level medical professionals.

Only by establishing such a system can medical resources, social security funds, and medical insurance funds be utilized effectively. By adhering to the principle that basic medical insurance should cover basic needs, we can ensure that basic medical insurance truly reaches the grassroots level and extends into households, thereby allowing commercial insurance to naturally find its place. The collaboration between telemedicine and commercial insurance, particularly through single-disease partnerships, will undoubtedly elevate the entire healthcare system to new heights, thus realizing a new paradigm of coordinated reform among medical care, health insurance, and pharmaceutical supply, along with a tiered diagnosis and treatment system.