A Blog by Jonathan Low


Oct 25, 2020

How Covid Is Boosting Chinese Telemedicine, Which Could Become Global Model

Convenience, speed and cost are driving patients online just as they have with other consumer services. JL

Martin Mou reports in the Wall Street Journal:

For Chinese consumers, one of the biggest draws has been the use of messaging apps to communicate with doctors. Doctors can review previous medical tests, inspect photos of conditions and prescribe medicines for patients of chronic diseases, then communicate with patients via messaging apps, phone calls or video chat. Consultation fees  range from the yuan equivalent of a few U.S. dollars to several dozen depending on doctors’ credentials. WeDoctor has connected 7,200 hospitals across China to its online platform, which also allows users to book in-person appointments.

As the Covid-19 pandemic swept across China in late January, the country’s telemedicine platforms raced to roll out free coronavirus-related services and the once wary government moved to ease regulations on providers, giving new life to a fledgling industry that has largely been losing money.

The effort, involving some of China’s largest technology companies, has introduced millions of people to online medicine in what industry analysts say could mark a watershed moment in the way the country of more than a billion people delivers health care.

It also could serve as a model for the growth of telemedicine around the globe. China already has the world’s most advanced digital health-care system, says Vikram Kapur, a Bain & Co. consultant specializing in health care in the Asia Pacific region, and “most health systems world over are looking to China as the primary source for future virtual-care delivery innovation.”

Between late 2019 and the summer of this year, the number of telemedicine providers in China jumped to nearly 600 from fewer than 150, according to official data reported by Chinese state media. And many of the biggest names in the business expanded their services.

Ping An Good Doctor, a leading telemedicine service founded in 2014 by Chinese conglomerate Ping An Insurance, 2318 2.31% opened an online portal for pandemic-related consultation services on Jan. 21, two days before the lockdown of the city of Wuhan, the epicenter of the pandemic. The portal garnered more than a billion visits in three weeks, the company says, with many users linking up for the first time with its network of some 1,800 full-time medical and nursing personnel and 10,000 part-timers.

On Call

The coronavirus pandemic has led more people in China to seek medical advice from doctors online.

Average daily consultations at Ping An Good Doctor










(First half)





Source: Ping An Healthcare & Technology Co.

Alibaba Health, a unit of e-commerce giant Alibaba Group Holding Ltd. BABA 1.19% , launched a real-time map to pinpoint places visited by confirmed Covid-19 patients, such as shopping malls and homes, and introduced free online medical consultations for residents of China and Chinese nationals overseas. And JD Health, the health-care unit of Nasdaq-listed Chinese online retailer JD.com Inc., in August expanded further from online drug retailing into telemedicine consultations, launching an online family-doctor service. The unit is now planning an initial public offering in Hong Kong that could raise at least $3 billion, The Wall Street Journal has reported.

The pandemic is an “unprecedented major opportunity” for telemedicine providers, says Fang Weihao, chief executive of Ping An Healthcare & Technology Co., the company that runs Ping An Good Doctor. Ping An Healthcare & Technology went public in Hong Kong in 2018, raising $1.1 billion in its initial public offering, and earlier this month it raised an additional $1 billion through a private placement of shares to fund an expansion of its business, noting the industry is entering a “new phase of rapid growth.”

Quicker service

For Chinese consumers, one of the biggest draws has been the use of messaging apps to communicate with doctors and circumvent long lines at the country’s highly ranked hospitals.

Li Yuexi, a 35-year-old financial professional in Shanghai, made use of telemedicine for the first time in July after he was gripped by intense back pain in the middle of the night and rushed to the emergency room at Ruijin Hospital. A doctor there found Mr. Li had a kidney stone and asked to carry out follow-up consultations via WeDoctor, a telemedicine provider founded in 2010, saying that doing so would be easier than scheduling appointments at Ruijin, one of the country’s best hospitals.

Over the next month, Mr. Li revisited the hospital twice for tests and extracorporeal shock-wave therapies for kidney stones. To get his results and advice, he linked up with the doctor four times on a WeDoctor platform running on WeChat, China’s most widely used social-media app. WeChat is owned by internet giant Tencent Holdings Ltd. TCEHY 1.15% , which is an investor in WeDoctor.

The service cut in half the time it would have normally taken to get treatment and advice from a physician, Mr. Li says. In the end, his condition stabilized and no surgery was required.

“It did turn out to be very convenient,” Mr. Li says.

Consultation fees on WeDoctor typically range from the yuan equivalent of a few U.S. dollars to several dozen depending on doctors’ credentials. WeDoctor has connected over 7,200 hospitals across China to its online platform, which also allows users to book in-person appointments at some facilities.

Second opinions

Others have found telemedicine helpful in finding a second opinion.

Ms. Wang, a working mother of two in Beijing who asked to be identified only by her surname because of privacy concerns, was pregnant when the coronavirus hit the Chinese capital and was reluctant to visit a hospital for fear of infection.

When she experienced hearing loss in both of her ears in May, however, she decided she had no choice but to go in for testing. But for a second opinion, she logged on to Haodf.com, another Tencent-backed telemedicine site.

Work In Progress

Ping An Good Doctor makes more than half of its revenue from selling over-the-counter drugs and health-care products, but online consultations are surging.

Revenue breakdown

Online medical services*

Sales of drugs and other products and services

$800 million










(First half)

*The data for online medical services revenue for 2015-2017 were referred as family doctor services.

Source: Company filings and IPO prospectus

There she found a doctor from Shanghai Huadong Hospital, whose otolaryngology department was highly rated among Haodf.com users. She detailed her symptoms in a text message, uploaded results of the tests she’d done at Beijing hospitals and paid 260 yuan ($38) to be able to communicate with the doctor for the next 48 hours.

The next day, the chosen physician texted back and told her to rest for two weeks, as he believed her issue was linked to her mental state. Ms. Wang asked whether her test results indicated a worsening condition. A few hours later she was reassured when the doctor told her that the differences in the results were marginal.

“The doctor was right,” she says. “I still have hearing loss from time to time, but it usually disappears in a couple of days.”

On Ping An Good Doctor, fees can start at 9.9 yuan ($1.50) to speak with junior physicians, while a neurology specialist at the prestigious Peking Union Medical College Hospital, founded in 1921 by the Rockefeller Foundation, might charge 500 yuan ($74). Doctors can review previous medical tests, inspect photos of conditions and prescribe medicines for patients of chronic diseases like hypertension, and then communicate with patients via messaging apps, phone calls or video chat.

Government support

China has taken steps to promote telemedicine in recent years, hoping it could help beef up the country’s relatively weak primary-care system and ease traffic at its best hospitals. In 2019, for example, China amended its Drug Administration Law to legitimize the sale of prescription drugs online.

But the industry has long been held back by limited consumer exposure, a preference for in-person physician consultations, lack of insurance coverage and other factors. “All of these factors were upended at zoom speed during the pandemic,” says Mr. Kapur, the Bain consultant.

In March, the country’s national health authority issued guidance encouraging reimbursement for online consultations and drug dispensing for common illnesses—such as colds or respiratory infections—and chronic diseases by the state-run universal health-care insurance scheme that covers 95% of the Chinese population. The move is widely viewed as a big boost to the telemedicine industry, as it could reduce patients’ out-of-pocket expenses.

In July, China’s State Council pledged to further expand the menu of services internet health-care providers can offer. Current regulations limit telemedicine operators to advising on common illnesses, follow-up consultations for chronic diseases and family-doctor services. Doctors are also restricted from making initial diagnoses via online consultation alone.

For now, most of China’s internet health-care firms are still losing money. Providers struggle to balance the often very high customer-acquisition costs with small, if growing, revenue streams from online consultations, Mr. Kapur says. In the past six months, the equation has changed slightly due to the surge in users.

Most of China’s large telemedicine providers currently make the bulk of their revenue from online sales of drugs and health products.

Ping An Good Doctor says revenue from online medical services more than doubled to 695 million yuan ($102 million) in the first half of this year. That made up just a quarter of the company’s sales; the bulk came from an online marketplace it operates that sells drugs, health supplements and even food.

Mr. Fang, its CEO, says there’s no rush to make the business profitable. The industry has gotten an unexpected boost from “explosive growth in online consultations and user traffic” and the company plans to focus on scaling up and growing its market share, he says.


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