The rapid rise of China has seen significant changes in various aspects such as macroeconomics, industrial structure, household income, and healthcare. Such changes have provided the necessary conditions and laid a solid foundation for advancing the "Healthy China" initiative. As the new round of medical reform is implemented, the current focus and challenge are on how to comprehensively enhance the "hard power" represented by medical equipment and staff allocation and the "soft power" reflected in hospital management levels.
An expert in the field of economics, Professor Guoen Liu, a Changjiang Scholar Distinguished Professor at the National School of Development at Peking University, Director of the Institute for Global Health and Development at Peking University, and Director of the China Center for Health Economics Research at Peking University, has long been devoted to the healthcare sector. He seeks to identify issues, develop strategies, and provide effective solutions for sustainable economic and social development and the high-quality improvement of people's well-being from an economic perspective. His work in medical system reform policy research, health technology assessment, and the academic development of health and development economics has provided strong support for the coordinated reform of medical care, medical insurance, and pharmaceuticals. He has made significant contributions and is regarded in the industry as an "undisputed leading advisor in China's medical reform field" and "a leading figure in the study of China's medical system reform."
Guoen Liu is not only among the first batch of university students admitted after the resumption of the national college entrance examination (Gaokao) in China but also the first person of Qiang ethnicity to earn a doctorate in the United States. Since resigning from his tenured position at the University of North Carolina at Chapel Hill in 2006 and returning to China full-time, he has been dedicating himself to his work at Peking University. "Our generation is fortunate to have grown up in and benefited from the great era of reform and opening up, and to have participated in and witnessed the rejuvenation of China."Liu expresses great pride and determination when discussing his ability to be at the forefront of the times and witness and participate in an era of great resurgence. This is a conscious responsibility and an active choice.
However, this does not fully explain why Liu has long been focused on the healthcare sector and its development. It turns out that even before attending university, as the most educated young person in his village, Liu had served as a barefoot doctor for a year and a half. While working to earn labor points, he also attended to the medical needs of livestock and villagers, effectively juggling two roles. However, due to a lack of political review during that special period, none of the nine medical schools he applied to admitted him. By a twist of fate, after submitting the necessary materials, he was admitted to the Mathematics Department at Southwest Minzu University. Liu's journey began from there, progressing from a mathematics major to the field of health economics. After taking a circuitous route, he returned to the place where his "health dream" began. In 1986, he went to the United States to study, where he was fortunate to learn from Professor Michael Grossman, the father of health economics. He acquired cutting-edge knowledge in health economics there, which allowed him to play a leading academic role in the field upon returning to China.
Since China's healthcare system reform in 2009, Guoen Liu has been deeply involved in national healthcare reform research. In 2011, he was selected for the first Medical Reform Expert Advisory Committee established by the State Council's Medical Reform Leadership Group and served as a "veteran" member for three consecutive terms. Together with relevant departments, he conducted systematic reform research in the three major areas of the healthcare system: medical care, pharmaceuticals, and health insurance. A series of reform measures were subsequently introduced.
In August 2016, the National Health and Wellness Conference was held, where General Secretary Xi Jinping proposed new guidelines for health and wellness work in the new era. Guoen Liu was invited to attend this conference. In October of the same year, the "Healthy China 2030" Planning Outline was issued, mapping out a development strategy centered on the health of the people and closely linking national development goals of universal health and overall well-being.
Since 2018, Liu has shouldered a significant responsibility as the head of the pharmacoeconomics expert group, participating in the national health insurance drug list negotiations. What is the significance of these insurance negotiations? Liu uses the 2021 health insurance negotiations as an example, highlighting a dramatic price reduction for a drug treating the rare disease spinal muscular atrophy—Nusinersen, from 700,000 yuan per injection to 33,000 yuan per injection. This may be the largest price cut for a single drug, but it was not done arbitrarily. It was based on China's actual payment capacity and a standard referenced by the World Health Organization (WHO) and many countries. According to this standard, if a new medical technology can improve the quality of life by at least one year without rendering the patient in a vegetative state, and the cost of the medical, technical, and pharmaceutical interventions does not exceed three times the country's per capita GDP, then the WHO considers it a worthwhile medical technology to purchase and pay for.
How does pharmacoeconomics play a role in negotiations? Guoen Liu provided a further explanation: "Pharmacoeconomic evaluation is a crucial component of drug price negotiations. It is incorporated into the selection and adjustment of essential medicines, playing a significant role in practice and decision-making. The scientific and standardized nature of these evaluations is key to influencing the results and their application." Using the 2023 national health insurance negotiations as an example, Liu explained that only drugs that passed two rounds of clinical discussions were eligible for evaluation by the pharmacoeconomic group. Each drug was randomly assigned to two pharmacoeconomic experts for "back-to-back" calculations, with strict rules prohibiting any exchange between the experts about their assessments, ensuring maximum fairness and minimizing bias.
Regarding the increasing proportion of innovative drugs entering the national health insurance reimbursement list each year, Liu candidly noted that getting onto the reimbursement list is just the beginning. The next step is to ensure that these new drugs are available in hospitals and can be prescribed by doctors, ultimately benefiting both patients and pharmaceutical companies. Meanwhile, he acknowledged that China's scale and capability for drug innovation still lag behind developed countries. The development of original drugs is particularly hampered by longer research timelines, higher risks, and greater investments, causing China's drug innovation to focus more on applied innovations. "High-quality development is inseparable from innovation. Without innovation, high-quality development cannot be discussed. In the pharmaceutical field, innovation has always been the driving force for high-quality development," Liu emphasized.
To effectively leverage pharmacoeconomics in national health insurance negotiations, Liu led a team of over 50 domestic and international experts to compile the bilingual (Chinese and English) "China Guidelines for Pharmacoeconomic Evaluations 2019," filling a methodological gap in China's pharmaceutical technology economic assessments. These guidelines will continue to be updated.
Guoen Liu subsequently compiled the "China Guidelines for Pharmacoeconomic Evaluations (2020 Edition)" which is tailored to China's specific circumstances and the global context. This guide aims to help researchers improve the quality of their reports and enable decision-makers to conduct better pharmacoeconomic evaluation studies. After its release, the guideline was reviewed and approved by the 26th Executive Council of the 24th Board of Directors of the Chinese Pharmaceutical Association, making it the association's group standard. Additionally, the guideline has received significant attention from the International Society for Pharmacoeconomics and Outcomes Research (ISPOR), the largest organization in the global field of health economics, which has specially recommended it on its website as the China Pharmacoeconomic Evaluation Guidelines.
A New Starting Point and Voyage: Safeguarding Global Health
In 2020, Peking University established the Institute for Global Health and Development (GHD) appointing Guoen Liu as the founding dean. GHD aims to bring together the interdisciplinary strengths of economics and management, public health and medicine, international relations and diplomacy, climate and environment, and humanities and social sciences. Adopting a transnational perspective, GHD places global health within the framework of human development. Guided by the core philosophy of "One World, One Health," the institute engages in scientific research, think tank services, talent cultivation, integration of industry and academia, and international cooperation and exchange. Its goal is to explore solutions to major human health issues, promote the transformation of innovative scientific and technological achievements, facilitate China's active participation in global health governance, and contribute to improving the health of all.
In 2017, following the goals outlined by the "Healthy China 2030" Planning Outline, Guoen Liu's research team, along with Professor Tingfang Liu from the Institute for Hospital Management at Tsinghua University, launched the "China Hospital Management Intervention Experiment based on the World Management Survey (WMS)" project. This initiative was supported by the National Natural Science Foundation of China. By adopting the WMS, the research team introduced the "World Management Survey—China Hospital Management Experimental Study," which, for the first time, quantitatively and precisely measured the management levels of Chinese hospitals using an internationally recognized and effective method. Through management experiments, they were able to ameliorate hospital management issues. Reflecting on eight years of systematic research, Liu realized that the ideas in the WMS could indeed reduce resource waste, minimize disparities in resource usage among physicians, and reduce the occurrence of problems, thereby enhancing the overall quality of medical care.
The WMS project established an international standard Chinese hospital management database and conducted surveys across 518 hospitals nationwide, covering 31 provinces (municipalities and autonomous regions) in mainland China. It examined Chinese hospital management levels within the global management framework and analyzed the factors influencing these levels. Furthermore, using experimental economics research methods, the project explored the causal relationship between the improvement of hospital management levels and hospital performance from four dimensions: standardized operations, target management, performance management, and talent management. This provided scientific, objective, and accurate empirical evidence for public hospital reform and the establishment of a modern hospital management system. Scientifically assessing the management levels of Chinese hospitals within the international hospital management framework offered valuable references for Chinese hospital managers.
In 2020, as the COVID-19 pandemic rapidly spread throughout the world and China faced its first and most severe wave of impact and challenges, Guoen Liu, as the sole health economist representative, was invited to join the national COVID-19 expert group to provide advice and suggestions for the country's epidemic prevention and control efforts. Facing the prospect that COVID-19 might coexist with humanity for a long time, Liu particularly emphasized one of the major issues posed by the pandemic—forcing humanity to advance new technologies centered around AI and digital technology, as well as providing healthcare services through online remote methods. He believed that, in consolidating the current achievements in combating the pandemic, there should be proactive thinking on how to leverage the situation to promote the development of emerging industries such as big data, telemedicine, and artificial intelligence, and to provide "Chinese ideas" and "Chinese solutions" to the world.
Since 2017, Guoen Liu has also served as the Chinese co-chair, leading the National School of Development at Peking University and the National Committee on United States-China Relations in jointly organizing the "China-US Health Track II Dialogue." This dialogue brings together distinguished experts from relevant fields in both China and the United States to engage in candid and in-depth discussions on topics related to healthcare. The dialogue produces consensus reports, which are submitted to key departments in both countries to inform national decision-making. The dialogue is held annually, alternating between China and the United States, and has successfully convened for eight consecutive sessions.
Recognitions and Achievements
Honors often accompany significant achievements. In 2019, Guoen Liu was recognized as "China's Most Notable Medical Reform Expert." In 2020, the National Healthcare Security Administration invited him to serve as the head of the pharmacoeconomics calculation group, participating in the annual adjustment of the national health insurance drug list. The administration's letter of thanks highlighted Liu's exceptional professionalism, meticulousness, discipline, dedication, and outstanding performance, acknowledging his significant contributions to the publication of the "National Basic Medical Insurance, Work Injury Insurance, and Maternity Insurance Drug List (2020)." In 2021, he was named the "Most Beautiful Technologist" by the Chinese Pharmaceutical Association. In 2022, Liu led his team to complete a special project by the national think tank, titled "Cost-Benefit Evaluation of National Epidemic Prevention and Control," which received important directives and commendation from central leadership. In December of the same year, he was elected as a member of the Chinese Academy of Medical Sciences.
Throughout his journey, Guoen Liu has always remembered his responsibilities, striving diligently in his research and teaching endeavors, and demonstrating resilience and perseverance in innovation. He has led GHD faculty and students to rural and impoverished areas in China to conduct economic research on health promotion and poverty alleviation. A notable project includes the "Economic Experiments in Precision Health Poverty Alleviation" in Daliangshan, Sichuan Province, funded by the National Natural Science Foundation. This project aims to explore the experiences of precision poverty alleviation, consolidating poverty alleviation achievements, and preventing the recurrence of poverty, highlighting the importance of studying the economic and social factors of diseases in different regions.
Students often ask Guoen Liu how he manages to stay so energetic and passionate despite his busy schedule. He encourages them with the following words: "China is determined to rejuvenate, but our history as a leading player on the world stage is not abundant. We are fortunate to live in this era, and only by learning openly and striving relentlessly can we live up to our mission and make the most of our time."
Biography
Liu Guoen, Chang Jiang Scholar Distinguished Professor and Dean of the National School of Development at Peking University, Director of the Institute for Global Health and Development at Peking University, Member of the Chinese Academy of Medical Sciences, and Director of the China Health Economics Research Center at Peking University. He is the convener of the "China-US Health Dialogue," a member of the State Council's Expert Advisory Committee on Health Care Reform, honorary chairman of the Pharmacoeconomics Professional Committee of the Chinese Pharmaceutical Association, and deputy editor-in-chief of the top international English journal of health economics, Health Economics . He served as the president of the Chinese Economists Society of the USA from 2004 to 2005, was selected as one of the "Top Ten Focus Figures in the Medical Field of 2012," was a member of the Academic Committee of Peking University from 2016 to 2022 and was the Deputy Dean of the School of Economics and Management at Peking University. In 2019, he was named "China's Most Influential Health Care Reform Expert." In 2021, he was awarded the title of "Most Beautiful Technologist" by the Chinese Pharmaceutical Association.
(Interpreted by Waverly Shi)
