When We Talk About Doctor Groups, What Are We Really Talking About?
On April 22, at the Second China Physician Group Conference, experts from various sectors of the healthcare industry shared their perspectives on “physician groups.” Some viewpoints were sharp and incisive, while others were relatively objective. The details are as follows.
In 1951, shortly after the founding of the People's Republic of China, the nation was embroiled in the Korean War. The wheels of war further devastated a domestic economy that was already struggling to recover from widespread destruction. In an era marked by pervasive famine, Premier Zhou Enlai foresightedly began contemplating the establishment of a “public healthcare system in China.” By 1955, systemic reforms were implemented, and the framework for state-run public hospitals was established. Former missionary hospitals, including Peking Union Medical College Hospital, Beijing Renai Hospital, and PLA General Hospital (301 Hospital), were uniformly restructured and converted into public hospitals. This marked the beginning of China’s public hospital system and its broader public healthcare framework.
From 1979 to 2009, China implemented multiple rounds of healthcare reform policies. The 2009 reform, also known as the “New Healthcare Reform,” primarily aimed to address the difficulties and high costs faced by the general grassroots population in accessing medical care. In 2015, the State Council and Premier Li Keqiang repeatedly emphasized the vigorous promotion of a “tiered diagnosis and treatment” system to rationally allocate medical resources and enhance basic medical and health services. The implementation of tiered diagnosis and treatment activated the “multi-site practice” model for physicians, releasing expert doctors and medical talent previously monopolized by tertiary hospitals, and legitimizing and marketizing practices such as “freelance consultations” and “visiting surgical procedures.” Consequently, “physician groups” emerged.
We are not intermediaries; we are midwives helping doctors realize their value.
“Physician groups” are alliance organizations formed, established, or participated in by multiple physicians. They typically practice medicine “independently” as a team, allowing physicians to engage in outside clinical activities at public hospitals transparently (“sunshine moonlighting”) and thereby earn higher income under greater flexibility. The physician group model is highly mature in the United States; renowned institutions such as the Mayo Clinic and the Cleveland Clinic are typical examples of physician groups.
According to statistics, there are currently over 100 physician groups in China. Since the establishment of the Wanfeng Physician Group and the Zhang Qiang Physician Group, physician groups in China have sprung up like mushrooms after rain, with many attracting favorable attention from the capital market and securing substantial investments. However, industry experts hold diverse views on the future of physician groups. The majority believe that physician groups represent the inevitable future model of healthcare delivery in China. Conversely, dissenting voices express concern over the conservatism and rigidity of China’s medical system and remain pessimistic about the prospects of commercial health insurance in the country.
1) Physician: Physician groups are like the apple in the Garden of Eden—appealing, yet feared to be toxic.
Physicians are the core of the healthcare system, and any healthcare reform that does not aim to liberate physicians is merely a sham. Some physicians have already “come out,” leaving the public system to establish physician groups. In addition to Wan Feng and Zhang Qiang mentioned earlier, such physicians include Yu Ying, Sun Hongtao, Liu Xingpeng, and Wu Kun. They are pioneers of the “physician group revolution.” As early adopters who dared to be the first to try something new, they provided the initial impetus for an industry whose various models were still in their infancy.
Among the more than 2.7 million physicians in China, those who have “come out” remain a drop in the bucket; the vast majority still operate within the state system, benefiting from the remnants of the planned economy. For them, this situation evokes a mix of longing and fear, apprehension and worry.
They yearn to break free from the constraints of institutional frameworks, to act at their own discretion, to achieve higher incomes, and to create greater commercial value. They fear being manipulated by capital; they worry that the policy environment is not yet mature, that commercial medical insurance remains underdeveloped, and that they lack a sense of security outside established institutions. They are also concerned that their brands lack sufficient influence, fearing that without the backing of major hospitals, they will lose patient followings and face dwindling patronage.
They are also concerned that, beyond their professional expertise, they lack proficiency in management and commercial operations. Even more worrisome is the medical risk associated with not having a large, established institution as a backer.
Therefore, many wise individuals are observing, preparing, and experimenting, hoping that doctors will carefully consider their career paths and make adequate preparations before making their move.
2) Hospitals: If you choose to leave, I respect your decision; please take care and cherish yourself on your journey.
Hospitals serve as incubators for physicians, fostering their professional development while shouldering the critical responsibilities of clinical care, medical education, and scientific research. High-quality hospitals provide a fertile ground for physician growth, boasting top-tier expertise, advanced equipment, and robust institutional systems. However, compared to their counterparts in developed countries, physicians in China’s public hospitals receive significantly lower compensation. This disparity has planted a seed of conflict in the hearts of many doctors: the stronger their professional capabilities, the more profound their inner turmoil and dilemma become.
As is well known, China’s healthcare system features an inverted pyramid structure, with a severe shortage of high-quality physicians. The concentration of resources has led to significant waste of the already scarce medical workforce. According to national statistics on healthcare service utilization by medical institutions, outpatient and emergency visits at private hospitals in China amounted to only one-tenth of those at public hospitals by 2015.
Multi-site practice, particularly by distinguished specialist physicians, is an urgent imperative. However, senior physicians in public hospitals are largely past their prime, while the core cohort of outstanding doctors is typically around 40 years of age—a highly sought-after resource fiercely competed for by various medical institutions. Although hospitals are reluctant to release these talents, most hospital presidents demonstrate broad-mindedness and respect physicians’ autonomous choices, thereby placing themselves in a relatively passive position.
3) Pharmaceutical Companies: Playing Along with You, Leading the Game for You, and Outplaying You at Your Own Game
Due to excessively stringent compliance requirements, joint-venture pharmaceutical companies are constrained from expanding their operational reach, limiting their role to providing moral support and ideological encouragement without the ability to take more substantive actions. Although they are deeply involved in China’s healthcare sector, they have been relegated to the status of mere spectators in these advanced explorations.
Taking Yibai Pharmaceutical as an example, domestic pharmaceutical companies have begun to explore the “physician group” model more extensively, leveraging their resource and capital advantages to vigorously develop physician groups through a “capital-intensive” approach.
Other wealthy and well-resourced “nouveau riche” listed pharmaceutical companies are also observing and experimenting, seeking to invest in more valuable “physician groups” to bet on the future. These affluent bosses can also gain more conversational capital and prestige within their circles.
4) Government: Pay attention to risk control and do not cause any trouble.
Regarding the role of “physician mobility” in activating medical resources, the National Health and Family Planning Commission (NHFPC) has been considering this issue for the past decade. However, due to the need to weigh pros and cons and assess risks, it has struggled to find an effective solution. The formulation and implementation of a policy require coordination among various “relevant departments,” which is no easy task. As a result, the policies introduced over the years have been relatively conservative.
The government actually supports the “physician group” model and recognizes its role in promoting tiered diagnosis and treatment. It further aims to leverage this model to channel high-caliber physicians down to the primary care level, genuinely enhancing the service capacity of grassroots medical institutions. This will enable the 900 million rural patients to access high-quality healthcare, receive excellent diagnostic and treatment services close to home, and have 95% of their diseases effectively managed.
In the practice of expanding physician groups, greater risk control is required; prioritizing safety to prevent incidents is sufficient. After all, maintaining stability remains the primary objective.
5) Capital: Reform Creates Abundant Opportunities for Rapid Market Entry and Beachhead Establishment
Looking back to 1984–85, when China’s reform and opening-up had just begun, most people were employees of state-owned enterprises (SOEs), while the few self-employed individuals were widely looked down upon. Later, these self-employed individuals became entrepreneurs, whereas SOE employees transitioned into workers in profit-driven private enterprises, losing their job security in the process. The few pioneers who explored the future were often met with scrutiny and wait-and-see attitudes, yet the abundant opportunities created by the reforms allowed those who were bold and astute to amass wealth from all directions.
Looking further back, the “physician group” model already existed in the era of Bian Que, who established China’s first physician studio in history. In ancient times, physicians practiced independently; the current trend is neither an innovation nor a mere repetition, but rather a “spiral ascent,” adapting healthcare models to better suit the contemporary era and society, while leveraging the Internet for rapid growth.
Looking ahead, we are entering the era of vertical healthcare. The capital market believes that future physicians will invariably work within physician groups, with hospitals serving merely as platforms for treatment. Concurrently, as medical resources decentralize, the patient care system is gradually shifting from a centralized model to one that is community-based, home-centered, and personalized. This transition will inject significant momentum into the development of physician groups. Currently, China’s healthcare industry remains a valuation lowland, progressively moving toward marketization and industrialization. Amidst this evolution, abundant opportunities are emerging; it is crucial to enter the market swiftly to secure resources and establish a dominant position.
However, sacrifices and bloodshed are inevitable on the path toward the future. The capital market tends to favor physician groups with the following advantages:
① The founder possesses a strong personal brand, demonstrating leadership and medical expertise;
② The physician group possesses unique (preferably monopolistic) technology;
③ Comprehensive commercial medical insurance solutions;
④ A strong operations team and management team;
⑤ Possess strong business operational capabilities;
⑥ A replicable model with high barriers to imitation for peers.
Where Does the Future of Physician Groups Lie?
Like most experts, I believe that the future of physician groups is an inevitable trend; this is the future model of medical care in China.
But that is the future; the path ahead remains fraught with constraints. Physicians’ hesitation, insufficient momentum for advancement, and the lack of openness in healthcare delivery models are all immediate challenges.
Medical system reforms in military hospitals are set to be implemented as early as June this year, seemingly initiating a major restructuring led by these institutions. Reports suggest that new policies aimed at “dismantling the established system” may also be introduced within the next two years. These measures reflect the state’s emphasis on the healthcare sector and its assessment of emerging trends, with the ultimate goals of liberating physicians and benefiting patients. We look forward to these developments.
Whether you are still employed by an institution or have embarked on the path of becoming a social or market-oriented professional, the ultimate core objective for physicians is to provide patients with better, more convenient, and higher-quality medical services. Regardless of the platform you work on, as long as you treat your patients with sincerity and compassion, you will be regarded as “renowned physicians” in the hearts of the public!
When every doctor upholds a strong sense of professionalism and contractual spirit, there will be no more incidents of medical violence.
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Text | Tianfu Luo Personal WeChat ID: 664116645