Before I dived into Ping An health care ecosystem, I will share my experience of medical treatment in hospital recently.
Last week, I have my throat stuck by fish bone, and went to hospital immediately. After registered, I went to Otolaryngology, the doctor give the suggestion to have X ray for my throat. They are at different places, and the doctor can not give the exact answer when got the X ray result.
After all the process, I have spent 3 days and a lot of money for this. Actually, this is coincidence with my opinion about the difficulties of medical treatment in China: the complex process, inadequate medical service, and high cost.
Luckily, there are many Chinese companies will to solve the problems of the medical treatment, such as Tencent, Alibaba, JD, Ping An, etc, which set up the medical service subsidiary and grew very quickly, especially during the COVID-19 pandemic.
On Sep 23, 2020, Ping An has released its health care strategy in Investor Day in Shenzhen, and showed Ping An dedication to invest in heath care ecosystem.
As Jessica Tan said, the health care ecosystem is one of Ping An Group’s long-term core strategies. With more than 20 years of effort and investment in the health care sector, Ping An has developed into a leading health care enterprise in China. Ping An aim to establish strong technological competition entry barriers by building a closed loop ecosystem of health care services. Ping An is committed to supporting the development of a healthy China; improving people’s health, seizing market opportunities, and creating greater value.
Ping An heath care ecosystem strategy is based on the deep study of market, the immense healthcare market in China is expected to grow from RMB6 trillion in 2019 to RMB16 trillion in 2030, due to significant demand and a supportive policy and regulatory environment.
The challenge of dealing with the aging population in China has revealed a number of pain points in the health care ecosystem. For example, the patients has inconvenient and expensive medical services, there are insufficient medical staff support and sub-standard medical care quality, the hospital has huge pressure to provide quality medical service, social health care insurance is under big pressure.
Ping An is developing a closed-loop health care ecosystem to create a new growth engine for the Group. The five components in the strategy of Ping An’s health care ecosystem encompass government, patients, medical service providers, social and commercial health insurers and technology. Ping An Smart Healthcare serves the government and offline health care service providers. Ping An Good Doctor focuses on patients and online health care service providers. Ping An Life, Ping An Annuity, Ping An HealthKonnect and Ping An Health serve payers, and Ping An Health Technology Research Institute provides world-class artificial intelligence technology to continuously improve health care service quality and efficiency.
Ping An health care ecosystem has three synergy advantages: 1) to expand user traffic, managing organizations for the insurers, and empowering service providers to maximize value; 2) to pursue vertical integration through serving the government, harnessing the resources of hospitals, doctors, and pharmaceutical companies, and empowering members of the ecosystem with technology to create competitive barriers; and 3) to create synergies with Ping An’s core financial businesses to acquire customers, enhance customer stickiness, and increase average value per customer.
For example, Ping An’s health care ecosystem plays a key role in growing the Group’s core financial business. Between 15% and 20% of Ping An’s new financial customers are acquired from the health care ecosystem every year. Contracts per financial customer that use the health care ecosystem services is 3.1, compared to 2.0 for non-users. The assets under management (AUM) of financial customers served by the health care ecosystem is approximately RMB10,000, compared to RMB5,600 for non-users. The synergy between Ping An’s health care ecosystem and its core financial business will be further enhanced through products, traffic, services and technology.
Ping An Good Doctor is a pillar of Ping An’s health care ecosystem, with a mission to create the largest and most advanced internet health care service platform in China. Since mid-2020, Ping An Good Doctor has been focused on a strategic upgrade, especially online health care services and its integration with offline services. During the Investor Day, Ping An Good Doctor launched its new service brand “Ping An Doctor Home“, a professional doctor-patient communication channel.
Ping An Good Doctor provides diagnosis and treatment for over 3,000 common diseases, the largest proprietary doctor service community in China and has also established a huge offline service network. As of June 30, 2020, Ping An Good Doctorhad 346 million users, with more than 1,800 medical and nursing practitioners and nearly 10,000 health care experts across the country. It has the largest offline service network, partnering with 110,000 pharmacies, 49,000 clinics and over 2,000 medical examination centres. In the first half of 2020, Ping An Good Doctor’s operating income increased by 21% year on year to RMB2.75 billion, of which revenue from online health care surged by 107% to RMB695 million.
Ping An Smart Healthcare, affiliated to Group subsidiary Ping An Smart City, focuses on four core areas to support the rapid development of China’s health care system: improving institutional management by empowering health and medical authorities; assisting doctors in diagnosis and treatment; supporting the public health system to manage epidemics and chronic diseases; and facilitating pharmaceutical research. The deployment of its smart image reading system has helped to substantially shorten diagnosis times from 15 minutes to 15 seconds. Currently, Ping An Smart Healthcare services are available in 90 Chinese cities and are expanding in overseas markets, serving a total of 20,000 medical organizations and 450,000 doctors.
Why Ping An Good Doctor and Smart Healthcare were very successful so far? because Ping An has Built A World-Leading Technology Health Care System
As we can see from the above graph, Ping An has built world class health care database with five libraries: diseases, health care products, prescription treatment, medical resources and personal health. The disease library contains 100,000 disease concepts and 420,000 disease terminologies. The health care product library contains 180,000 drug manuals and 84,000 Chinese medicine prescriptions. The prescription treatment library contains 150,000 prescription formulas and 30 million medical documents. The medical resource library contains 500,000 Chinese doctors and 2.2 million scientific researchers. The personal health library contains 1 billion diagnoses and information on treatment.
The Company enjoys the technological differentiation with its leading algorithm-training platform. The Company’s Saifei platform supports large-scale parallel experiments, which can reduce project workloads by 30% to 50% through intelligent scheduling and allocation of computing resources, increase prediction speed three to six times, accelerate calculations by 100 times, and reduce memory consumption by 23% through intelligent dispatch and allocation of computing resources. The Company’s health care algorithm models can effectively boost R&D efficiency by five to eight times.
Ping An has developed one of the world’s leading intelligent diagnosis assistance platforms. It has developed the world’s largest chronic disease management platform and the world’s largest health care database. The company has the world’s second-largest number of patent applications for health care technology. This knowledge is applied extensively through Ping An’s “medical brain” to support artificial intelligence decision-making.
From above, I have summarized some points that why I have confidence that Ping An health care ecosystem has the ability to solve the medical treatment problems.
- Ping An has built world class health technology to enable patients to have diagnosis quickly and in low cost.
- Ping An health care ecosystem will support Ping An core business development.
- Ping An will invest heavily into health care ecosystem in long term since Ping An have great cash flow from core business.
- Ping An health care ecosystem will solve government, patients, medical service providers, social and commercial health insurers problems in a closed loop