Six facts about Aging China and its Health Care system
China has a large unmet needs concerning the older population, creating a sizable market potential.
There is a genuine buzz in the world about the staggering number of aging population, either as entrepreneurs, investors, health care pros, or as people influenced by personal experiences with ailing parents and grandparents. It is a key area of industry most underserved and most in need.
China, as a high population country, also steps into the ranks of the aging society. Though “steps into” might not the correct phrase, it is much rather like “taking a high-speed” train into the aging society. China recognizes that the aging population is a major threat to its future, and its actively working towards reversing the track. Still, the policy change alone is not going to take effect and bring relief to the population aging problem until 2035.
China recognizes that the aging population is a major threat to its future, and its actively working towards reversing the track. Still, the policy change alone is not going to take effect and bring relief to the population aging problem until 2035.
Here are our findings about the topic through a “GLOCAL” (Global-Local) perspective. We hope it can provide more context for designers and clients who are interested in understanding the senior segmentation in China.
1) The Big number: Nearly 35% of the Chinese population will be 65 years old and above in 2050
By the end of 2018, China had 249 million people aged 60 or above, accounting for 17.9% of the total population. (1) That is ten times the population of Australia. This demographic has increased by 8.59 million since 2017, which equals the entire population of Switzerland. At that rate, the aged population is expected to reach 300 million by 2025. By 2050, it is likely to peak at 487 million, accounting for 34.9% of the total population. (2)
2) The byproduct of one-child policy
In order to suppress the excessive population growth rate, the one-child policy was published in 1979, valid until the mid-2000s. Therefore, the birth rate and population growth rate decreased, resulting in the current 4–2–1 family structure (four elderlies, one couple & one child). (3) Between traditions, which expect the younger generation to take the responsibility of their parents by default and the dwindling numbers, the younger generation is burdened with the obligation of caregiving. It also causes many “empty-nest” elderlies (lonely seniors live by themselves without offspring) in urban settings.
3) The reform of Senior care: an un-displaced, home-based with community support.
Current 90–7–3 senior care mode launched by government means 90% of senior people could be aging at home, 7% of senior people could be taken care of with support from community and 3% in institution, e.g., nursing home. The majority of seniors are unwilling to relocate from their homes as it puts their family’s reputation at stake. However, this mindset is changing with the millennial generation. The limited resources of nursing homes also deter seniors from choosing that option. (4)
Ministries and commissions of the State Council have made many efforts in senior care, meanwhile encouraging all kinds of private enterprises to participate in the reform of senior care. For example, Aizhaohu (iCare)(5), founded in 2015, has set up senior care stations within different residential areas across Shanghai with support from the government, aims to improve senior life quality through big data, AI and IoT, etc. These senior care stations are often combined with community hospital/clinic centers that not only provide intelligent home service, basic physical examination, and pharmacy but also provide activity rooms and beds for short-term stay after seniors’ discharge from hospital. The vision from the government about home-based senior care is that seniors do not need to move out of their apartment; meanwhile, they can enjoy all the services at home or within 15 mins walk.
4) Focus on “disease prevention” rather than “disease treatment.”
180 million of elderly people suffer from chronic diseases in China. It brings about a substantial economic burden. According to the Forward industry research institute, the expenditure on chronic diseases accounts for about 70% of the total health expenditure, which was about 3,244.15 billion yuan in 2016. (6) The CPC Central Committee (Central Committee of the Communist Party of China) and the State Council issued an outline of the “healthy China 2030” plan. (7) It entails different directions to improve citizens’ health status, including building digital health information systems, increase in public fitness programs, improved medical insurance system, etc.) All the above indicates that there is a significant market potential in China around chronic disease management and disease prevention.
5) Growing number of senior internet users.
China has a rapidly developing online infrastructure. Platforms like WeChat/QQ (Social) and Alipay/Taobao (Payment and e-commerce) are integrated into everyday life. According to a report published by CNNIC, by the end of 2018, China had 54 million internet users aged 60 or above, accounting for 6.6% of the total internet user population. China saw a 35% yearly growth of senior users online since 2017. (8) With the advent of time, current netizens aged 40–50 will enter the senior domain, leading to a boom in online presence in the next 20 years.
6) Shanghai pilot solutions for the aging society
Uneven economy development and healthcare resources make Shanghai the fastest aging city in mainland China. Stepping into the aged society in 1979 makes the city the first as well. By the end of 2018, the population of registered citizens aged 60 or above in Shanghai had reached 5.0328 million, accounting for 34.4% of the total registered population (~ 15% higher than average of China mainland). (9) Being the city with the highest rate of aging, Shanghai carried out a series of initiatives, hoping to alleviate some of the challenges.
One such initiative saw the launch of a new policy that allowed nurses (typically working in public hospitals) to register online and provide private healthcare services in seniors’ homes. (10)Other senior care initiatives included home-based long-term care services, senior care communities, etc.
China has a large unmet needs with regards to the senior population, creating a sizable market potential. China’s senior care market is expected to reach 22 trillion yuan by 2050 compared to 960 billion yuan in 2014. (11) The country is working towards building an elderly-friendly environment to cater to the rapidly aging population. It is vital to tackle these challenges keeping in mind local culture, history, and policy.
China’s aging society has increasingly diverse and multi-level needs. “Smart” senior care products have a massive potential in disease prevention and long-term care within the home environment.
Article References: (1) Data source: National Bureau of Statistics
(3) XIAO Yejing, LIU Chang, et al. An analysis of the problem of senior care within single child family in the new era [J] Labor Security World, 2019(15):36–36.
(4)JI Jingyao. A study on the effect of caregiving time length to offspring’s parents on their care performance [J]. The World of Survey and Research, 2018, (2):14–19.
(5) Official web: http://www.izhaohu.com/
(6) GUO Xuyang. A study on the design of chronic disease management service for the elderly based on user behavior model [D].Wuxi: Jiangnan University, 2017.10–11.
(7) Full text: http://www.gov.cn/xinwen/2019-07/15/content_5409694.htm
(8)The 40th statistical report on the development of Internet in China: http://www.cnnic.cn/hlwfzyj/hlwxzbg/hlwtjbg/201708/P020170803598956435591.pdf
(9)GUO Yaotong, Yao Hui. Research on the Current Situation and Influential Factors of Smart Senior Care — — Analysis of Living Patterns of the Elderly in Shanghai [J]. Scientific Research on Aging, 2018. 6(7)
(10)CHEN Hao, LIU Ziwen. Enjoy “Internet + nursing services” at home [J]. Shanghai Informatization, 2019(04):50–53.