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Notice on improving medical liability insurance solutions

Updated: Aug 4,2014 11:33 AM     nhfpc.gov.cn

The Health and Family Planning Commissions (Health Bureaus), Justice Departments (Bureaus), Finance Departments (Bureaus) and Administrations of Traditional Chinese Medicine in the provinces, autonomous regions and municipalities; Health Bureau, Justice Bureau, Finance Bureau of Xinjiang Production and Construction Corps; Insurance Regulatory Bureaus:

To implement policy decisions made by the central government, to maintain orderly medical practices and to establish a good doctor-patient relationship, we put forward the following requirements in an effort to improve the mediation-insurance system that centers on people’s mediation. This is in coordination with court mediation and judicial conciliation to bring risk-pooling into full play (mainly through medical liability insurances) in settling medical disputes and managing medical risks. Another goal is to improve China’s medial liability insurance system while increasing insurance coverage and quality of services.

Full awareness of the importance of medical liability insurance to doctor-patient relationships

Medical care is a major livelihood issue that concerns hundreds of millions of China’s population. As a risk-pooling system with functions of mutual assistance and social management, medical insurance plays a significant role in protecting legitimate interests for both doctors and patients, preventing and settling medical disputes, and establishing a harmonious doctor-patient relationship. It helps:

1) protect legitimate interests for both doctors and patients and establish a good rapport between them. Medical liability insurance is a kind of insurance paid by medical institutions that are held liable for money damages. As a third party to help settle medical liabilities, it offers timely economic compensations to patients based on contracts, which largely avoids medical disputes and enhances doctor-patient relationships;

2) prevent and settle medical disputes to ensure properly functioning medical practices. Medical insurance as a third-party solution can get medical disputes settled legitimately outside of medical institutions that are thus able to refrain from getting involved;

3) improve risk-management capabilities and the entire medical-care system. Insurance is a basic risk-management tool in the market-economy system. Medical liability insurance that leverages both incentives and restrictions on medical institutions raises institutions’ desire to avert risks, jack up housekeeping efforts and improve the quality and management of medical services. This can majorly reduce medical disputes and strengthen the overall capacity for risk management.

Leading the efforts to expand coverage and improve services of medical liability insurance

Departments including the provincial health and family planning administration, the judicial administration, finance, insurance supervision, and traditional Chinese medicine management should be fully aware of the importance of developing medical liability insurance. They should also lead efforts to establish effective insurance that coordinates both with local governments and Party committees. Local support is crucial to the development of medical liability insurance as it can help establish a sustainable insurance system and settle medical disputes by creating a favorable political environment.

The departments of health and family planning and traditional Chinese medicine management must organize and mobilize medical institutions, especially public ones, to expand the coverage of medical liability insurance and not to miss anyone qualified. By 2015, tertiary public medical institutions need to make sure all medical workers are covered by the insurance, and secondary ones’ insurance coverage should reach at least 90 percent. Meanwhile, grass-roots medical organizations including government-run ones should pilot insurance to find a more suitable risk-pooling mechanism and reduce professional medical risks. Non-public medical institutions are also encouraged to do so. Various kinds of insurance should be introduced and developed in order to improve the nation’s risk-pooling mechanism.

Medical organizations of all categories must set up a liability-sharing program in case of incidents concerning medical quality and safety. Medical damages should be considered part of the overall performance ratings of medical workers. This is to enhance their awareness of responsibility.

Judicial administration departments must provide guidance in accordance with laws to mediating medical disputes before they are taken to the court. People’s mediation committees have to receive every petition for mediation in time and settle medical disputes according to the law. It’s unacceptable to refuse a petition simply because the medical institution is not covered by the medical liability insurance. The departments need to work out a good system and refine the workflow process, while standardizing the format of mediation protocols and establishing a viable mechanism to combine mediation and compensation. These protocols should be referred to by insurance companies in settling medical disputes.

Local finance departments must provide more support for medical liability insurance in order to bring its role in risk pooling into full play. Insurance premiums should be included on the expenditure list of medical institutions.

Insurance regulatory departments need to strengthen their supervision, management and assessment of insurance companies. They must make sure insurance contracts and clauses continually improve but also maintain reasonable premium rates, thus balancing payments and a narrow margin of profit. This will make the medical liability insurance more attractive.

Insurance companies are encouraged to invest more in developing medical liability insurance by cultivating more talented employees, thus better managing risks and providing more services. They must compete rationally and refrain from violating regulations or bringing harm to either medical institutions or their patients.

Insurance companies must review insurance cases regularly to adjust premiums according to the risk rating of medical institutions. Tailored insurance products are welcome, and so are innovations that are able to meet varied and multi-level demands from medical institutions. Insurance claims should be based on the people’s mediation protocol but with simplified procedures, simplified processes and upgraded services.

Enhancing the coordination between related departments to promote medical liability insurance

Medical liability insurance is an important part of the medical risk-pooling process in China. Departments of all levels should lead the efforts to steadily promote medical liability insurance in support of these policies and regulations.

Insurance companies are encouraged to get involved early in settling medical disputes as a complementary solution for mediations. Medical institutions should strengthen cooperation with insurance companies and third-party mediation organizations to avert medical disputes or to get them settled more smoothly. They should establish a seamless, long-term communication channel with them in order to be fully informed of details including feedback on medical quality and safety, insurance claims, etc., and be able to fix the problems in time. These solutions can put medical liability insurance well on track for a sound and sustainable development.

Exploring risk-pooling methods that suit China’s national conditions

Recent years have witnessed many kinds of localized risk-pooling systems including regulations that helped prevent or settle medical disputes and that called for a medical liability insurance system. A slew of supporting measures have been rolled out in a combined effort by the departments of health and family planning, the judicial administration, insurance regulation and traditional Chinese medicine management. They created a framework for medical liability insurance, set standards for insurance claims, encouraged medical institutions to seek insurance packages that underwrite both people and property with comprehensive solutions, and established a co-insurance system to share medical risks. These measures have led to various achievements over the years.

Provincial departments must go deeper into individual cases to learn from them with the goal of creating a risk-pooling system adapted to the local conditions of economic development, medical services and insurance management. They should coordinate with the ongoing reforms of the medical and health systems.

Boosting national insurance awareness and creating an amicable environment

Local departments must prepare to promote medical liability insurance and educate residents on policies concerning the settling of medical disputes and potential risks. These departments must take initiative in dealing with medical risks and disputes. Meanwhile, they must expand the coverage of medical liability insurance and build a favorable social environment for its implementation.

Strengthening supervision and evaluation of work related to medical liability insurance

Departments of all levels must take advantage of the “safe hospitals” program as they work out a detailed action plan to improve each supporting program as required. This is in order to ensure the orderly and steady progress of medical liability insurance.

Medical risk-pooling solutions, mainly in the form of medical liability insurance, should be factored into the performance evaluation of medical institutions in the “safe hospital” program as well as health and medical reforms. An appraisal mechanism needs to be established to boost the quality and efficiency of insurance services for medical institutions and patients.

Provincial departments of health and family planning administration, judicial administrations, finance, insurance regulation and traditional Chinese medicine management need to take initiative to put into practice each and every political measure. They must draw on past experiences and dig deeply into difficulties and problems, while reporting back in a timely manner to the National Health and Family Planning Commission, the Ministry of Justice, the Finance Ministry, the China Insurance Regulatory Commission, and the State Administration of Traditional Chinese Medicine.

National Health and Family Planning Commission

Ministry of Justice

Ministry of Finance China Insurance Regulatory Commission

State Administration of Traditional Chinese Medicine

July 9, 2014

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