China's medical rehabilitation market likely to see significant growth potential, five key sub-sectors identified, finds KPMG report
HONG KONG,May 25,2020 -- With increasing importance placed on medical rehabilitation,KPMG has identified five out of eleven rehabilitation sub-sectors with the highest potential in terms of their market attractiveness and market entry abilities. These are neurological rehabilitation,orthopaedic and joint rehabilitation,cardiac rehabilitation,elderly rehabilitation and child rehabilitation,according to KPMG's recent analysis.
Titled Medical Rehabilitation: Trends Driving A New Blue Ocean,the new report jointly published by KPMG and the Chinese Non-government Medical Institutions Association (CNMIA) – the sole association of private hospitals and a national tier-one industry body in China –explains in detail the current status and future development trends. In recent years,China's medical rehabilitation service capabilities continue to strengthen in both public general hospitals and private specialist hospitals. According to the report,as of 2018,the number of rehabilitation specialist hospitals in China has reached 637,of which 24% are publicly run and 76% operated by private institutions.
As the population ages at an ever-faster pace,it is expected that the number of patients with chronic diseases will increase. Also,as the living standard in China improves,patients are now looking for higher quality rehabilitation services.
Mr. Hao Deming,Executive Vice President,Secretary General and Legal Representative of the CNMIA,said: "China's rehabilitation medical service institutions are currently facing issues including small in scale,low number of beds,low talent allocation,decentralised resources and limited service scope,leading to unfulfilled potential needs for rehabilitation. With the aging population and the increasing number of chronic patients,China's rehabilitation medical services are facing severe challenges,but also significant development potentials."
Data of the China Public Health Statistical Yearbook and KPMG analysis show that China's medical rehabilitation expenses per capita are much lower than those of the US,with a lower number of beds for rehabilitation per capita. This implies that there is a gap between medical rehabilitation spends in China compared to major developed countries,and the gap in supply-demand in the market is creating significant potential.
Jenny Yao,Partner,Head of Healthcare,KPMG China,says: "Medical rehabilitation is an important social service that affects people's livelihood. Service providers are actively planning to capture the huge potential in this market. However,new entrants are currently facing difficulties in making decisions on market entry strategies,specialist service focus selection,business model creation,and target patient groups positioning. Strategic choices and clear market positioning become the keys to success in this competitive market."
All the five key sub-sectors identified in the report have a significant patient base.
The first sub-sector identified is neurological rehabilitation,which treats mainly patients with cerebral stroke,brain damage or spinal cord injury. Cerebral stroke has become the lead reason for death or disability among China's adult population. The report suggests that,in the future,robot treatments can be introduced to perform simple and repetitive motion tasks to provide patients with more choices; low-cost and immersive virtual reality (VR) technology can also be an effective tool for cognitive research,evaluation and rehabilitation treatments; while artificial intelligence applications (AI) are expected to be more widely used in the field of rehabilitation too to provide personalised rehabilitation programs for patients and for rehabilitation physicians' reference.
Secondly,the orthopedic rehabilitation market in China has a large patient base,but at present,only a few hospitals in China can achieve early intervention in orthopedic rehabilitation,and most medical institutions still emphasize only on surgery but enough on rehabilitation. In the future,orthopedic rehabilitation specialist hospitals may consider setting up specialist hospitals within in general hospitals which have little rehabilitation capability,or supplementary units nearby surgical hospitals with strong technical capability to establish a standardized integrated system to cover from outpatient,surgery to post-operative rehabilitation. Also,hospitals can consider building a remote orthopedic rehabilitation guidance platform.
Thirdly,it is recognised that cardiac rehabilitation can significantly reduce recurrent cardiovascular events and effectively improve patients' body function and quality of life. However,the main challenge is that the actual referral rate in China is still low. In recent years,the guidelines and setting requirements for cardiac rehabilitation in China have become clearer. KPMG believes the industry can consider increasing the participation rate of cardiac rehabilitation through professional cooperation and home-based artificial intelligence services.
Fourth on the list is elderly rehabilitation. With the aging population increasing,elderly rehabilitation may become the next rigid demand in the market. Different from the other rehabilitation sub-sectors,elderly rehabilitation involves multiple disciplines. KPMG believes that the entry strategy for the elderly rehabilitation market can be community-based and through establishing community pilot medical institutions. It is anticipated that many new integrated service models and online "service supermarket" platforms will emerge.
Lastly,the number of child rehabilitation patients is rapidly increasing too,mainly because of wider recognition by the society. The current difficulties faced by children's rehabilitation institutions include the lack of clarity in the business model,the incompleteness of the business field,and the need to cope with the dual challenges from both the medical and education aspects. The report suggests that children's rehabilitation institutions can cooperate with foreign institutions to adopt their systematic child rehabilitation technology and mature operation and management models,in order to provide integrated medical and educational rehabilitation services at international standards to better meet the needs of parents of children.
With the integration of information technology and rehabilitation,as well as the development of clinical science,the quality of rehabilitation treatment in China is also likely to improve.
A key issue which remote rehabilitation needs to address is customising rehabilitation solutions for patients,as well as a reasonable follow-up and monitoring mechanism,so that patients can maintain and follow the plan,as well as complete their routines continuously and regularly,thus achieving the desired results.
Meanwhile,public hospitals and institutions can also consider setting up high-end rehabilitation centres,with reference to the models of the international medical centres and VIP medical centres at public hospitals,in providing customized rehabilitation solutions to patients in demand,leveraging top-tier medical resources.
The core factor for smart rehabilitation to succeed is the seamless interaction and integration of evidence-based rehabilitation solutions and smart technology that connects hospitals,communities and households. During the process of rehabilitation at home,doctors can continuously check in and advise patients on their recovery process via the smart network and ensure that they strictly follow the requirement and routine of the programme design.
Yaosays: "Patients' awareness and understanding of medical rehabilitation directly impact on the outcome of the rehabilitation. It is crucial to educate patients at early stage,which could help them grasp the best opportunity for recovery and would reduce incidences of dysfunction and disability,as well as improve patients' ability to care for themselves and sustain a higher quality of living. Rehabilitation therapists directly operate rehabilitation treatment plans and training measures,and they play an important role among rehabilitation professionals. The training of rehabilitation therapists is a key driver of the development of rehabilitation. In addition,in offering more educations and accelerating the training processes in rehabilitation professions,institutions can also consider appropriately increasing the treatment of rehabilitation practitioners to maximise the motivation and retention of professions to ensure the stability of the rehabilitation medical team."
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