Fu Shan, Assistant Vice-President of Pactera Observes: Brief Talk about Differences of IT Service between China and USA
Source: pactera.com View: 213 Date: 2015-12-08

Actually speaking, this article is not country comparison of IT service, just news to introduce thinking about medical industrial information development between two countries. An information causes my attention is a bill that will importantly affect fate of outsourcing: at last week, United States Senate passed a bill to abolish main articles of “Obama Patient Protection and Affordable Care Act” (referred as to “ObamaCare”). It included forcing medical institutions to adopt HER, and enlarging scope of health care to whole boost outsourcing market related with medical industry in USA. On one hand, medical institutions have to upgrade information technology system to meet requirements of law; on the other hand, they also need control cost via outsourcing and deal with changes. In that year, Indian industrial analysis institution once estimated that “ObamaCare” will bring new outsourcing opportunities with tens of millions USD; after five-year’s development, Indian enterprises indeed have begun to enter into achieving stage. For example, Cognizant raised revenue forecast in quarterly results published in last month that was the third times in 2015; medical department has been the first one with 43% among all industries and has achieved quarterly total revenue with 1 billion USD, accounting for near 30% of total income. Although life science and medical industry of TCS don’t account for 10% of total income, its revenue was also near 300 million USD in recent quarter; and the industry also has become growth champion with 20% among all industries of TCS. Under big background of weak European and American traditional finance and manufacturing industry, medical industry makes people be surprised by such high growth.

Market with huge opportunities of course hinders high risk. The senate bill mentioned at the beginning of this article will be veto by Obama no accident; will also not bring any real influences for relative outsourcing market. However, since implementation of “ObamaCare”, because it involved complicated current systems, processes, and behaviors, it has been always disputed by the public. In aspect of actual effective, the preferential function of health care has not good results; technological investment can’t bring direct benefits for hospital and patient; on the contrary, it produces many negative experiences. In long term, whether Democratic Party can continually hold the power of next government, the political legacy from Obama also has possibility to face huge uncertainty; at that moment, although outsourcing of medical industry can’t be stopped, the industrial growth will be influenced without destination. What’s more, medical information and personal privacy also are two points focused by the public. Outsourcing industry frequently has become target of relative public opinions; additionally, outsourcing affecting this industry or employees in USA has been questioned in each industry. Outsourcing enterprises, especially big Indian IT outsourcing companies will have more tests when develop in medical industry in USA.

Informatilization of medical industry is a potential market in USA, beside the huge promoted element from “ObamaCare” mentioned above, because IT application maturity in whole industry and medical institutions is far away from finance and manufacturing industries, future development will still have big space. according to research data from IDC, in the year of 2014, medical IT market in USA excludes information system from medical insurance, the third-party payment and governmental regulatory was 46.4 billion USD. While based on statistics from Gartner, if accounted closely relative medical insurance, the total amount of medical IT service market in USA reached 20 billion USD in 2014. In spite of this, this market is still difficult for China to catch up with: complicated process, current systems, medical and political complicated relations mentioned above in American medical systems are difficult market thresholds for China to enter. We can see that surprising growth of Indian enterprises is a result of accumulation and investment for long time; the more important is that Indian enterprises have advantages to have relatively high political participation and stronger lobbying powers for government that is difficult to catch up with for easy personal and investments. In spite of this, all Indian IT service enterprises may only achieve 10% of share in American medical IT outsourcing market; in future, leap-type growth is afraid of accomplish only depending on huge amount of purchasing professional technology merchants in medical industry. In this aspect, Chinese enterprises can’t have enough resources and spirits to compete with enterprises in India and even in EU and USA.

There is no doubt that the real meaning of domestic IT service enterprises focusing on medical IT service trend in USA is more focusing on medical information market in China. Compared with USA, IT spending levels of medical industry in China still has gap. According to research data from IDC, in the year of 2014, medical IT industry only accounted 1.78% of whole IT market in China; while in USA, the proportion was 6.62% that was near 16 times or more of medical information investment in China per capita. Although China has different situations of population health and people’s health care consumption, the matured market information in USA can also provide some experiences for China to learn not only including microscopic and relative technology experiences of system design, development and operation in hospital management, clinical management  and medical science research management; also including the best practices of information management and governance among hospitals, and even from whole medical industry. Especially during the period of “13th Five-Year”, China will also face an important course—medical reform; thus experiences learnt from American health care are more precious. Insiders of medical informatalization deeply understand problems in China such as not enough investment in domestic medical IT department, difficult information sharing in medical industry and even internal hospital, locality separatist force of medical IT service market and fragmented competition and etc. However, under comparison between two countries, we can find that these problems like intercommunication and interaction of medical information also need to be solved in USA; while not enough information investment for hospitals may be only a stage trend for medical industry in process of development. The medical core is interaction between hospitals and patients that is naturally different from e-commerce business via platform to win; therefore, internet can’t change reality of lacking of medical resources in China. However, medical informatization in China also has some its own advantages meanwhile behind EU and USA: immaturity and weak bases also mean to have fewer burdens from remaining systems; governmental stronger administrative and planning & implementation abilities can play bigger functions in medical industry—the public utility; mobile, internet and data analysis can be applied in medical & health system with fewer resistances. According to China’s report from IDC, growth of residents’ wealth, population aging and continually promoting medical reform as well as emerging information technologies applied in medical industry – these big key elements are greatly promoting development of current medical informatization in China. I believe that in future China’s medical informatization will catch up with technological level and management level in EU and USA by quicker speed; medical IT service market will also have growth opportunities don’t lose the opportunities in USA and will get rid of current layout in next five or ten years to be centralized and nationalized.

Months before, I recommended an article that explains China has the most advanced medical system all over the world. Although this article has been supported by some classmates and friends living overboard based on their own experiences in friend circle, I still understand that this scientific and rational post can’t be public spread and accepted generally; it also can’t change the established impression of hospitals and health care in China from people’s brains. However on the December 7th of 2015, Li Bingbing, the famous star in China showed her drip picture in Weibo that is more useful than the article spread by me and let more people understand medical differences between China and foreign countries. Because of this, I think about the gap of medical informatization between China and USA, we may have many unconscious feeling and self-abasement only because “we are parts of this.” This over self-black is not only moral advantages of public opinions, but has limited function to improve current situation and to catch up with competitors and may produce misunderstanding in direction and method of hardworking. The most active way should admit deficiencies, at the same time make more and deeper research and understanding matured market and other countries that have similar situations. Only understand all competitors, can we orderly and efficiently distribute investment of medical informatization. For example, most hospitals in China may provide 10% of IT personal or less medical information investment to support medical burdens like dozens of times of in USA. Whether these professional and cautious medical information technological personal can be a fundamental support to adjust bright perspectives of China’s medical informatization.

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