China's anti-corruption watchdog finds public hospitals vulnerable to graft and bribery

The death toll in China due to Coronavirus has reached 41.
PHOTO: Reuters

In February 2017 Zhou Fang, then president of Laibin People’s Hospital in southern Guangxi, was kidnapped by a local health commission official and two accomplices who claimed to be from the party disciplinary watchdog.

They believed Zhou was taking bribes and forced him to write a statement admitting to wrongdoing and pay them 100,000 yuan (S$21,000) before being released.

Ironically, the confession provided clues for the real party disciplinary watchdog after both the kidnappers and their victim were arrested by local police days later.

Zhou was officially investigated a year after his kidnapping and found to have taken bribes of more than 18.1 million yuan between 2003 and 2018. He was also found to have 9.39 million yuan in assets that could not be accounted for.

Details of the bribery case, released by the Central Commission for Discipline Inspection (CCDI) on its website on Monday, highlighted how public hospitals in China could easily become hotbeds of graft and, consequently, a target of the country’s anti-corruption crackdowns.

Between 2016 and 2020, the discipline inspection and supervision commission in Guangxi alone investigated more than 4,000 cases in the medical and health care system, including about 2,500 cases involving hospitals of different levels. The party members investigated generally took advantage of their posts for personal gain when buying medical equipment, drugs and medical supplies, according to the CCDI statement.

In 2018, some 56 hospital chiefs and their deputies were convicted of bribery. In the first half of last year, at least nine senior officials in public hospitals were taken away for disciplinary investigation.

In one case, Wang Tianchao , former president of Yunnan No 1 People’s Hospital, was found to have taken bribes worth 110 million yuan and received 100 apartments and 100 parking spaces. In 2018, he was sentenced to life in jail.

The National Health Commission has issued several documents in recent years demanding that doctors clean up the industry by resisting kickbacks and bribes, and improve the surveillance of key posts, such as those in charge of medical supplies. But Zhuang Deshui, deputy director of the Research Centre for Government Integrity-Building at Peking University in Beijing, said supervision using such regulation would be fruitless.

“[It’s] better to use technology such as big data analysis to monitor which drugs were prescribed as an indicator than just asking the doctors to hand in the red packets because such notices have been given for years, but giving favours in bidding or drug purchase can still take place in more secretive ways,” Zhuang said.

He said hospital corruption was hard to crack down on because of the huge amount of drugs or supplies used, translating into big kickback benefits.

“Being transparent in bidding and publicising prices helps people to estimate whether there has been fishy business for hospitals favouring higher-priced bidders who offer kickbacks,” Zhuang said.

Read Also
China’s anti-graft watchdog targets toxic celebrity culture and fans
China’s anti-graft watchdog targets toxic celebrity culture and fans

The investigation into Zhou was triggered after the kidnappers, who were sentenced to 12 years in jail, told anti-graft investigators Zhou had admitted to receiving an imported car worth 470,000 yuan from a drug distributor in Hunan province.

He was found to have received bribes from pharmaceutical industry employees while buying drugs, medical supplies, testing agents and medical equipment. The investigation showed the bribery was systematic, corrupting the local health care system.

The case against more than 40 people involved more than 50 million yuan in bribes. Some 76 people in the Laibin health care system were given administrative or party disciplinary punishment over the bribery cases.

“The bribe giver would buy off our senior officials and the junior officials at the same time – otherwise there is a risk of being reported. If the people in one department have been taken care of and everyone has their hands in the pot, then things can be done very easily,” Huang Minwei, an official with the Laibin Discipline Inspection Commission, was quoted as saying in the CCDI statement.

“The characteristics of this industry determine whether the dealers give bribes not only for one or two days or one or two people. The dealers do everything they can to expand the relationship network because the more people involved, the more lucrative it will be for them,” Huang said.

Zhou would inquire about the equipment models, budget for a price and instruct his hospital to invite bidding according to specifics of the companies Zhou had associations with. He took 10 to 20 per cent of the contract value after successful bidding as a return for his favours.

Such under-the-table dealings have made bidding almost a formality and influenced others in hospitals to break the law.

Zhou’s successor Yang Wenbin was also indicted in 2019 for taking bribes. Yang told investigators he was not offered such bribes when he was deputy even though he was aware of what Zhou was doing.

“Why wouldn’t I take them now I am the president?” Yang told the investigators.

Yang was sentenced to 10½ years in jail for receiving more than 5 million yuan in bribes. Zhou was sentenced to 13½ years and fined 4 million yuan in May.

This article was first published in South China Morning Post.