UPMC to manage five hospitals in China
Skip to main content
MDHC_Logotype_white
Subscribe
  • My Account
  • Login
  • Subscribe
  • News
    • This Week's News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • People
    • Regional News
    • Digital Edition
    • 'Little old West Virginia' sets pace on vaccine rollout
      4 cyberscams for hospitals to watch out for
      COVID-19 hastens hospitals' revenue cycle outsourcing moves
      Operation Warp Speed Dr. Moncef Slaoui, Pfizer Group President Angela Hwang, Moderna CEO Stephane Bancel, CVS Health Executive Vice President Karen Lynch and McKesson CEO Brian Tyler participate in a panel discussion on the COVID-19 vaccine.
      Hospitals, drug companies strive to stand out virtually at JPM
    • 'Little old West Virginia' sets pace on vaccine rollout
      Dr. Bruce Siegel
      By protecting the healthcare safety net, Biden can put us on the path to a stronger country
      Joe Biden
      Revamp of the nation's vaccination effort may not be enough
      COVID-19 hastens hospitals' revenue cycle outsourcing moves
    • The Check Up: Trenda Ray
      The Check Up: Trenda Ray of the University of Arkansas for Medical Sciences
      Trenda Ray
      Q&A: Arkansas nursing leader looking for creative staffing solutions as COVID cases surge
      Cook Lydia 4x6_i.jpg
      Northeast Ohio health systems increase community benefit values in 2019
      Vaccine rollout hits snag as health workers balk at shots
    • CMS approves rule forcing insurers to ease prior authorization
      COVID-19 still a big uncertainty for insurers in 2021
      Health insurers' outlook boosted after Dems' Georgia win
      humana_i.jpg
      Humana supports Ohio not-for-profits with $500,000
    • 'Little old West Virginia' sets pace on vaccine rollout
      Joe Biden
      Revamp of the nation's vaccination effort may not be enough
      CMS will raise Medicare Advantage plan payments by 4.08% in 2022
    • Operation Warp Speed Dr. Moncef Slaoui, Pfizer Group President Angela Hwang, Moderna CEO Stephane Bancel, CVS Health Executive Vice President Karen Lynch and McKesson CEO Brian Tyler participate in a panel discussion on the COVID-19 vaccine.
      Hospitals, drug companies strive to stand out virtually at JPM
      Intermountain, Trinity, Memorial Hermann behind $300M private equity fund
      Operation Warp Speed to bump up McKesson's stock price
      Reporter's notebook: J.P. Morgan's 2021 health conference
    • A man in a room with servers.
      Momentum grows to outsource hospital tech functions in 2021
      5 things to know about Google's $2.1B Fitbit acquisition
      Providence bets on machine-learning, consolidating data centers
      Mental health treatment was most common telehealth service during COVID
    • Sticking to Mediterranean diet is good for the brain
      Chance of COVID-19 triage care looms over Arizona hospitals
      U.S. ramps up vaccinations to get doses to more Americans
      367146427.jpg
      Should businesses mandate that staff get the COVID vaccine?
    • Cone Health CEO, CFO to depart amid pending Sentara merger
      Tower Health's finance chief resigning after years of steep losses
      AHRQ director Gopal Khanna resigns in response to Capitol riot
      Brigham president stepping down after Moderna controversy
    • Midwest
    • Northeast
    • South
    • West
  • Insights
    • ACA 10 Years After
    • Best Practices
    • InDepth Special Reports
    • Innovations
    • The Affordable Care Act after 10 years
    • New care model helps primary-care practices treat obesity
      doctor with patient
      COVID-19 treatment protocol developed in the field helps patients recover
      Rachel Wyatt
      Project to curb pressure injuries in hospitals shows promise
      Yale New Haven's COVID-19 nurse-staffing model has long-term benefits
    • Dr. James Hildreth
      How medical education can help fight racism
      Modern Healthcare InDepth: Breaking the bias that impedes better healthcare
      Videos: Healthcare industry executives describe their encounters with racism
      Michellene Davis
      Healthcare leadership lacks the racial diversity needed to reduce health disparities
      Hospital divided into multiple pieces
      Health systems may be warming to offshoring, a mainstay practice for insurers
    • A woman with a wearable sensor talking to her provider.
      Wearable sensors help diagnose heart rhythm problems in West Virginia
      self service station
      COVID-19 pushes patient expectations toward self-service
      Targeting high-risk cancer patients with genetics
      A nurse holds up a phone with a message to a family member saying surgery has started.
      Texting, tablets help hospitals keep family updated on patient care
  • Transformation
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Highmark Health inks six-year cloud, tech deal with Google
      Study: 1 in 5 patients report discrimination when getting healthcare
      HHS proposes changing HIPAA privacy rules
      Android health records app launches at 230 health systems
    • California hospitals prepare ethical protocol to prioritize lifesaving care
      Amazon, JPMorgan Chase, Berkshire Hathaway disband Haven
      Digital pathways poised to reshape healthcare continuum in 2021
      Healthcare was the hardest hit by supply shortages across all U.S. industries
    • A woman with a wearable sensor talking to her provider.
      Wearable sensors help diagnose heart rhythm problems in West Virginia
      New care model helps primary-care practices treat obesity
      How hospitals are building on COVID-19 telehealth momentum
      Researchers: Hospital price variation exacerbates health inequities
    • MedPAC votes to boost hospital payments, freeze or cut other providers
      Most Next Gen ACOs achieved bonuses in 2019
      Congress recalibrates Medicare Physician Fee Schedule after lobbying
      CMS approves rule to encourage value-based drug pricing
  • Data/Lists
    • Rankings/Lists
    • Interactive Databases
    • Data Points
    • Health Systems Financials
      Executive Compensation
      Physician Compensation
  • Op-Ed
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
    • Wellstar CEO calls adapting for the pandemic her bold move
      Howard P. Kern
      Recognizing the value of telehealth in its infancy
      Dr. Stephen Markovich
      A bold move helped take him from family doctor to OhioHealth CEO
      Dr. Bruce Siegel
      Why taking a hospital not-for-profit was Dr. Bruce Siegel’s boldest move
    • Barry Ostrowsky
      Ending racism is a journey taken together; the starting point must be now
      Laura Lee Hall and Gary Puckrein
      Increased flu vaccination has never been more important for communities of color
      John Daniels Jr.
      Health equity: Making the journey from buzzword to reality
      Mark C. Clement and David Cook
      We all need to 'do something' to fight inequities and get healthcare right, for every patient, every time
    • Dr. Bruce Siegel
      By protecting the healthcare safety net, Biden can put us on the path to a stronger country
      Healing healthcare: some ideas for triage by the new Congress, administration
      Dr. Sachin H. Jain
      Medicare for All? The better route to universal coverage would be Medicare Advantage for All
      Connectivity: a social determinant of health that can exacerbate all the others
    • Letters: Eliminating bias in healthcare needs to be ‘deliberate and organic’
      Letters: Maybe dropping out of ACOs is a good thing for patients
      Letters: White House and Congress share blame for lack of national COVID strategy
      Letters: VA making strides to improve state veterans home inspections
    • Sponsored Content Provided By Optum
      How blockchain could ease frustration with the payment process
      Sponsored Content Provided By Optum
      Three steps to better data-sharing for payer and provider CIOs
      Sponsored Content Provided By Optum
      Reduce total cost of care: 6 reasons why providers and payers should tackle the challenge together
      Sponsored Content Provided By Optum
      Why CIOs went from back-office operators to mission-critical innovators
  • Awards
    • Award Programs
    • Nominate
    • Previous Award Programs
    • Other Award Programs
    • Best Places to Work in Healthcare Logo for Navigation
      Nominations Open - Best Places to Work in Healthcare
      Nominations Open - Health Care Hall of Fame
      Nominations Open - 50 Most Influential Clinical Executives
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Top 25 Minority Leaders
    • Top 25 Women Leaders
    • Excellence in Nursing Awards
    • Design Awards
    • Top 25 COOs in Healthcare
    • 100 Top Hospitals
    • ACHE Awards
  • Events
    • Conferences
    • Galas
    • Webinars
    • COVID-19 Event Tracker
    • Leadership Symposium
    • Healthcare Transformation Summit
    • Women Leaders in Healthcare Conference
    • Workplace of the Future Conference
    • Strategic Marketing Conference
    • Social Determinants of Health Symposium
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Minority Leaders Gala (2022)
    • Top 25 Women Leaders Gala
  • Listen
    • Podcast - Next Up
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
    • Carter Dredge
      Next Up Podcast: Ready, set, innovate! Innovation and disruption in healthcare
      Next Up Podcast: COVID-19, social determinants highlight health inequities — what next?
      Ceci Connolly
      Next Up Podcast: How to navigate the murky post-election waters
      Next Up Podcast: Saving Rural Health
    • An older man wearing a mask receiving a vaccine.
      Beyond the Byline: Verifying information on the chaotic COVID-19 vaccine rollout
      doctor burnout
      Beyond the Byline: How healthcare supply chain struggles contribute to employee burnout
      Beyond the Byline: Covering race and diversity in the healthcare industry
      Beyond the Byline: How telehealth utilization has impacted investor-owned company earnings
    • Leading intention promote diversity and inclusion
      Introducing Healthcare Insider Podcast
    • The Check Up: Trenda Ray
      The Check Up: Trenda Ray of the University of Arkansas for Medical Sciences
      The Check Up: Dr. Kenneth Davis
      The Check Up: Dr. Kenneth Davis of Mount Sinai Health System
      The Check Up: Dr. Thomas McGinn
      The Check Up: Dr. Thomas McGinn of CommonSpirit Health
      The Check Up: Mark Ganz
      The Check Up: Mark Ganz of Cambia Health Solutions
    • Video: Ivana Naeymi Rad of Intelligent Medical Objects
  • MORE +
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Hospitals
October 28, 2019 06:15 AM

UPMC to manage five hospitals in China

Tara Bannow
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    AP

    UPMC and a partner broke ground Monday on the first of at least five private hospitals they will operate in China, in what UPMC calls the largest presence of American academic medicine outside of the U.S.

    The Pittsburgh-based academic medical center is partnering with the Chinese conglomerate Wanda Group to open at least five hospitals in five major Chinese cities. The first, in Chengdu, is expected to open in 2022; dates for the others haven't been set.

    "No one has actually been successful in importing a truly American or Western style of medicine into China at the scale in which we are proposing here or planning to go forward with," said Chuck Bogosta, president of UPMC International.

    UPMC won't pay for any of the construction. The Wanda Group is funding both the hospitals' capital and operating costs. UPMC will manage the facilities under an agreement with Wanda, for which Wanda will pay the health system "significant" management fees, Bogosta said. He added Wanda will also play a management role.

    A handful of U.S. health systems and other types of U.S. firms have tried developing private hospitals in China, with varying degrees of success. The country's public hospitals are struggling to keep up with demand, and its government has encouraged the development of private hospitals to ease the pressure. In 2014, the government announced it would allow wholly foreign-owned hospitals, up from a maximum of 70% foreign ownership previously.

    But foreign operators still face a number of barriers. It's a highly regulated area, and developing private hospitals in China takes a long time.

    For one, several Chinese government ministries are involved in getting hospitals up and running, said Lawton Robert Burns, a healthcare management professor at the University of Pennsylvania's Wharton School.

    "It's so byzantine, and they don't necessarily work together," he said.

    Jeff Bernstein, senior vice president of UPMC International and its country manager for China, said the approval process for getting hospitals built in China is not unlike what happens in the U.S. In any case, Wanda Group will oversee regulatory approvals, he said.

    Boston-based Partners HealthCare announced in 2014 it was in preliminary talks with two Chinese partners to build a 500- to 1,000-bed facility. It declined to share an update on that project. ProMedica in Toledo, Ohio, has also worked aggressively to expand its business in China, and is currently advising on three healthcare projects there. Cleveland Clinic last year announced an advising relationship on a hospital in Shanghai.

    More importantly, it's tough to convince physicians to leave prominent posts at public hospitals to work in private ones. And once they do, it's hard to go back.

    "It's kind of a chicken and egg," Bernstein said. "If there aren't enough patients in the private hospital, the public hospital doctor does not want to leave his or her position at the risk of losing patient volume, losing the prestige of a professorship and then a lot of these private hospitals aren't surviving."

    Bogosta and Bernstein said they don't think UPMC will suffer the same fate because it will place its own specialists in the hospitals it's developing. The doctors UPMC recruits to work in the hospitals can come from outside the organization, too.

    "The ideal profile would be a physician who has come to the U.S. or come to another country with a Western style of medicine and wants to go back," Bogosta said. "There's a lot of physicians that fit that profile."

    UPMC plans to recruit through professional associations like the Chinese Association of Orthopaedic Surgeons.

    Private hospital operators also struggle with the fact that Chinese patients don't trust their facilities and still largely view public hospitals, especially tertiary hospitals, as delivering the highest quality care, Burns said.

    "They eschew the smaller hospitals and the private hospitals because they don't trust them as much," he said. "That's a huge hurdle."

    The vast majority of people in China have public insurance, but there's also a growing commercial insurance market and large middle- and upper-class populations who view private insurance as a way to see doctors faster and in cleaner environments, Bernstein said.

    The average doctor visit at a public hospital in China lasts less than five minutes, he said. They will be much longer at UPMC and Wanda's hospitals, which will have roughly 400 to 500 beds, compared with roughly 1,500 beds at the typical public hospital.

    The first hospital under the agreement will be called the Chengdu Wanda-UPMC International Hospital. UPMC will be in charge of hiring the hospital's administrative team and clinical leaders. It will also train the staff. The other hospitals will be in "first-tier" cities like Beijing and Shanghai, Wanda Group wrote in a news release. The company, which did not return a request for comment, characterized those hospitals as the "first batch."

    The acute-care hospitals will be highly specialized in areas like oncology, heart and vascular, neurology and orthopedics, Bernstein said.

    This is the Wanda Group's first foray into healthcare, Bogosta said. Most of its business is in real estate, film, children's entertainment, sports and travel. The company generated the equivalent of $30.3 billion in 2018, according to its website.

    UPMC has been working in China for about eight years now, Bogosta said. Last year, the health system announced a five-year contract to help plan and operate a cancer center at a private hospital in Beijing. The health system signed its first medical services agreement in China in 2011, when it agreed to provide second-opinion pathology consultations to a diagnostic laboratory. UPMC also helped create an international medical center in Changsha and partnered with a women's hospital to raise its standards of care.

    UPMC is among the country's largest health systems, having drawn $18.8 billion in operating revenue in 2018. But like other health systems, it has struggled in recent years with a slim operating margin and has focused on building up its non-hospital businesses, like its enterprise arm. Bogosta said UPMC wouldn't be in the Wanda partnership if it didn't think it could generate margins to help offset the declining U.S. reimbursement market.

    But Burns, of the Wharton School, said he's seen many U.S. health systems announce international hospital operations over the decades—not just in China—and it's not clear that any have been successful.

    "I've seen this stuff come and go repeatedly," he said. "I'm not sure people get the message."

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Mihaljevic discusses COVID-19 and Cleveland Clinic's future in State of the Clinic
    Mihaljevic discusses COVID-19 and Cleveland Clinic's future in State of the Clinic
    Georgia could take back vaccine from slow-moving providers
    Georgia could take back vaccine from slow-moving providers
    Sponsored Content
    Get Free Newsletters

    Sign up for free enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today

    The weekly magazine, websites, research and databases provide a powerful and all-encompassing industry presence. We help you make informed business decisions and lead your organizations to success.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS
    • Instagram

    Stay Connected

    Join the conversation with Modern Healthcare through our social media pages

    MDHC_Logotype_white
    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • This Week's News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition
    • Insights
      • ACA 10 Years After
      • Best Practices
      • InDepth Special Reports
      • Innovations
    • Transformation
      • Patients
      • Operations
      • Care Delivery
      • Payment
    • Data/Lists
      • Rankings/Lists
      • Interactive Databases
      • Data Points
    • Op-Ed
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Awards
      • Award Programs
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top 25 Innovators
        • Top 25 Minority Leaders
        • Top 25 Women Leaders
      • Nominate
      • Previous Award Programs
        • Excellence in Nursing Awards
        • Design Awards
        • Top 25 COOs in Healthcare
      • Other Award Programs
        • 100 Top Hospitals
        • ACHE Awards
    • Events
      • Conferences
        • Leadership Symposium
        • Healthcare Transformation Summit
        • Women Leaders in Healthcare Conference
        • Workplace of the Future Conference
        • Strategic Marketing Conference
        • Social Determinants of Health Symposium
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Minority Leaders Gala (2022)
        • Top 25 Women Leaders Gala
      • Webinars
      • COVID-19 Event Tracker
    • Listen
      • Podcast - Next Up
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • MORE +
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing