Aged care and healthcare to China

Trends and opportunities

The market

China’s population is rapidly aging. The cumulative effect of decades of robust economic growth on rising life expectancy coupled with a history of strict population control policies, has resulted in a growing aging population. By 2020, China’s population is forecast to reach 1.4 billion, 248 million of whom will be aged over 60.[1] These changes to China’s demographics, in addition to existing pressures on the medical services industry has underpinned the governments plans to accelerate the development of an aged care system and promote construction of aged care facilities.

Recent national policy initiatives have sought to develop a system of services to address the escalating demands of China’s elderly population. The blueprint of this emerging system, as outlined in the thirteenth five-year plan, consists of three tiers of social services for the aged: home-based care, community-based services and institutional care. The Chinese Government has introduced policies to attract private capital from domestic and overseas investors and is encouraging the adoption of smart healthcare.

Healthy China 2030, is a national health strategy and details several government priorities for the aged care and health care sector.

These include:

  • The introduction of an integrated health care and aged care system
  • The integration of traditional Chinese Medicine in aged care services
  • Research and development into the prevention and treatment of chronic diseases
  • The development of health management services for the elderly
  • Increased awareness and prevention of dementia.

In recent years, the Chinese government has increased efforts to build residential aged care facilities and has actively promoted the construction of senior housing as part of its wider efforts to provide 35-40 beds per thousand elderly citizens, supported by a workforce of 10 million aged care workers by the year 2020.

National policy directives urging local governments to apply preferential policy treatments for private-sector development of elder care facilities, such as tax exemptions and subsidies for local companies, has further fuelled investment into the sector. As of September 2017, China was reported to have 28,000 registered aged care institutions and 7 million aged care beds. The fastest growth in China’s aged care sector has occurred in well-developed provinces and municipalities where the pressures of an ageing populations are more acute. These include municipalities and provinces such as; Shanghai, Beijing, Guangdong, Jiangsu, Zhejiang, Hunan, Hainan, Hubei, Shandong, and Sichuan, Hebei and Tianjin.

Favourable policy reforms, coupled with rising consumer demand and purchasing power, has bolstered entrepreneurial interest from abroad. Countries such as Australia, France, Japan, USA and the United Kingdom have sought to lead the way in pursuing investment opportunities in Western-style senior housing in China.

The provision of quality healthcare and aged care services requires the development of a highly skilled workforce, trained to industry standards. China’s aged care sector is largely characterised by a low-skilled nurses and casual care workers, often with little industry experience. The National Health Commission reported that only 50,000 aged care workers and 38,000 medical care workers in China had vocational qualifications.

Despite recent favourable policy developments, China’s aged care industry is still in its infancy. There remains a significant shortage in expertise and infrastructure to keep pace with demand from China’s growing middle class.

For more details, please download:

[1] Trends and predictions on China’s ageing population China National Committee of Ageing, http://www.china.com.cn/chinese/news/1134589.htm

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