Chen Weiguang: Passion and Innovation Are Essential for Internet Healthcare Success

 Chen Weiguang’s Brilliant Insights:

1. Entrepreneurship shouldHow to ThinkRestructuring the Existing IndustryChainArticle

2. Clearly define the company’s product model

3. By collaborating withPatient、Profit Model of Collaboration Between Pharmaceutical Companies and Insurance Companies

4. It takes time for mobile health to gain recognition



Startups Should Reconstruct the Existing Industry Chain

While investors can articulate the business models of e-commerce and other sectors with great clarity, the profitability model for mobile health remains in a phase of trial-and-error and exploration.

We all tend to optimize existing ecosystems and processes. However, entrepreneurial success is often not about improving the old “horse-drawn carriage,” but rather about disruption. Jack Ma’s success stemmed from breaking free from traditional business models and value chains.

My greatest insight is that while many entrepreneurs recognize the abundant opportunities within the healthcare ecosystem, most still adhere to traditional mindsets, focusing on optimizing the existing industry chain. However, since the current chain is inherently distorted, this approach inevitably encounters significant challenges.

It is difficult to achieve success by merely improving upon the existing hospital infrastructure. While appointment registration systems can enhance hospital efficiency, they fail to address the fundamental underlying issues. Although data from appointment registrations can be leveraged to offer additional services, such systems remain confined within the traditional framework. Moreover, given the regional nature of the healthcare market, rapid nationwide replication across China is challenging.

Ganji.com essentially reconstructed the entire classified advertising value chain, leaving print media with no viable path forward.

A carriage may not necessarily have horses. Why do doctors lack motivation in hospitals? A doctor spends only two minutes seeing a patient. The problem is that human incentives are not linked to profitability. Why has O2O become so popular? Because it directly aligns interests with service providers. Similarly, physicians are a key link; if their incentives are not ultimately tied to the outcome of successfully treating patients, this chain will remain perpetually distorted.

Regardless of the project, it is essential to address physicians' motivation, and this motivation must be relevant to the physicians you serve.

For instance, light consultation breaks away from the traditional healthcare system, while appointment registration optimizes the existing medical care process.

Whether you can create an ecosystem outside of hospitals is what I value most. Public hospitals, whether due to systemic or historical issues, are difficult to marketize. When your company is small and lacks bargaining power, it is actually very difficult to make changes within their existing system. If you want to create more user value, you need to create new service models.

Clearly Define the Company's Product Model

Regardless of the project undertaken, it is essential to first accurately define the company’s positioning. Evaluating specific metrics will provide a clearer understanding of the enterprise’s positioning and help explore more suitable business models.

Patient-to-patient interactions follow a community model, doctor-to-patient interactions follow a clinic model, and doctor-to-doctor interactions follow a referral model; different combinations yield different models.

Patient communities are platforms where individuals with the same medical condition can gather to communicate, share their treatment journeys, or recommend reputable physicians. However, whether in the United States or China, patient communities still face significant challenges. First, patient engagement is relatively low, with only a subset of patients willing to participate. Second, it remains difficult to establish a viable business model for sustainable profitability.

Profit Model Through Collaboration with Pharmaceutical Companies and Insurance Providers

Many mobile health ventures rely on third-party payers to sustain their business models. Pharmaceutical companies have already begun advertising in the mobile health space, but their overall spending remains relatively modest. Whether they will significantly increase their advertising outlays or shift toward targeted advertising remains to be seen.

In addition to pharmaceutical companies, insurance companies are also major partners for many mobile health firms.

The advantage of insurance companies lies in actuarial science, but they do not necessarily have precise user data; therefore, Oscar needs to obtain relevant data from third parties. Moreover, such data must be sufficiently large in volume; otherwise, it holds no value.

Furthermore, smart hardware can also be leveraged to collect data for patient health management; however, the critical success factor for smart hardware lies in customer acquisition capabilities. Many companies developing smart hardware must focus on how to acquire users at a relatively low cost, encourage high-frequency usage of their devices, and maintain a certain level of user engagement.

Oscar Health in the United States offers insurance services at lower prices than traditional insurers. First, it uses smart hardware to monitor users’ behavioral patterns; consistent patterns can lead to reduced insurance premiums. Second, it partners with the telemedicine platform Teladoc to estimate users’ potential medical expenses through data from smart devices and virtual consultations.

The HMO model in the United States is similar to an insurance model. Patients pay $1,000, which can be used to see doctors at designated hospitals or for online consultations. The medications prescribed by doctors are also from a specific formulary. A portion of this $1,000 goes to the doctor as income. If a doctor can cure a patient with only one type of medication, they receive higher compensation. Thus, physicians’ income is directly linked to patient treatment outcomes.

If your user base and physician network are not sufficiently large, you cannot adopt the HMO model. Furthermore, domestic insurance companies lack complete or accurate data; historically, all data has been sourced from hospitals. Due to various factors, hospital data is often of limited value, making it impossible to achieve cost-containment objectives. This constitutes a major challenge for commercial insurers.

It Takes Time for Mobile Health to Gain Recognition

Currently, online consultation platforms such as DXY and Chunyu Doctor are generating revenue. However, achieving significant profitability in the short term remains uncertain, largely due to long-standing perceptions among Chinese consumers, who are reluctant to spend RMB 100–200 on a single online medical consultation. Conversely, setting prices too low fails to attract high-quality physicians to provide services on these platforms. Therefore, short-term profits are unlikely to reach RMB 1 billion, and scaling this business model will require considerable time.

Gaining acceptance for mobile healthcare takes time; at this stage, the primary barrier remains user mindset. Patients seek out the best doctors, yet these top-tier physicians may not be motivated by a modest fee of 50 yuan. In summary, three currently trialed models have demonstrated profitability: collecting user data to recommend medications and deliver advertising on behalf of pharmaceutical companies; the Health Maintenance Organization (HMO) model; and monetizing doctor-patient relationships through patient-side fees.