UPMC’s Diagnosis: Heal US-China Relationship with Collaboration

UPMC boasts the distinction of being one of the largest academic medical institutions in the United States. However, as UPMC International’s Senior Vice President and Managing Director of China Jeffrey Bernstein notes, that is not the only credit that distinguishes the organization among its international medical peers. UPMC has also expanded globally to become an internationally recognized health care leader with almost 30 years of experience operating hospitals and healthcare facilities outside of the US. It currently operates 40 hospitals and more than 800 doctors’ offices and outpatient centers in the US and around the globe.

Within the US, UPMC can trace its history back over 120 years, but the organization’s first major step in operating hospitals internationally came with the establishment of the ISMETT organ transplant center in Palermo, Italy in 1997. Since then, UPMC has expanded exponentially to other countries and regions. As is the case with many other multinationals, Bernstein identifies China as a focus area for UPMC. “We have leveraged our success in Italy to develop a “country based” strategy, where we aim to build scale in certain top priority markets, entering Ireland in 2008 and China more recently. UPMC China has grown quickly, driven mainly by opportunities for achieving scale advantage with relatively large hospital projects which are geared to meeting unserved demand for premium healthcare.”

China Expansion and Partnerships

In 2011, UPMC embarked on its first foray into the China market through an agreement with KingMed Diagnostics, the largest independent third-party medical diagnostic laboratory in China. Since then, the company’s footprint in China has continued to expand, with partnerships to develop and enhance the Xingya International Medical Center in Changsha as well as providing hybrid radiology training courses for Huaxi Hospital of Sichuan University and, most recently in 2019, the signing of a far-reaching strategic cooperation agreement with China-based conglomerate Wanda Group to build and operate a world-class hospital in Chengdu.

Bernstein shares that the China team has been focusing on its joint venture with Wanda Group. The Chengdu Wanda UPMC Hospital, the first hospital from the agreement, is set to open soon in Sichuan province. The 500+ bed facility will mark the first hospital in China to be modeled after, and managed by, a leading American academic medical center and will feature six “Centers of Excellence” for oncology, orthopedics and sports medicine, neurology and neurosurgery, heart and vascular, ophthalmology, and gastroenterology.

The wide-reaching partnership UPMC has established with Wanda has been a commitment many years in the making. Bernstein explains it was only after the successful multi-year partnership ramping up an international medical center within an existing major public hospital at Xiangya Hospital that the organization was ready to deepen and expand their commitment to the China market. “We were ready to explore an opportunity for UPMC to manage an entire hospital in China. Following discussions with multiple potential partners, we were most impressed with Wanda Group.” He goes on to outline the four main criteria that made Wanda Group stand out: “A shared vision to bring world-class care to Chinese patients, who would have otherwise traveled overseas for care; experience in executing on major international projects, both abroad and in China, especially with branded service companies, whether in film, hospitality, sports, etc.; experience in constructing complex facilities in China; and openness to UPMC’s model whereby we would have complete operational control over the project.”

US-China Healthcare Cooperation

There’s no denying that relations between the US and China have reached a challenging stage. From human rights to trade policy, the two countries are at odds on a number of issues. However, areas remain where the nations are working together towards shared goals. The healthcare field offers one such opportunity for potential collaboration. Bernstein describes UPMC’s international approach as aiming to be both an innovator and contributor to every respective market.

UPMC has been working towards the goal of improved accessible care in China for years. It has worked in recent years with the Beijing Arion Cancer Center, which is pioneering a unique practice model in China with a multi-disciplinary team approach in which physicians from several specialties will manage the patient along their cancer journey. One of the multi-disciplinary approaches of the Center is the Tumor Board, which pairs various UPMC oncologists along with a variety of subspecialists as needed, to meet bi-weekly with the Arion Center team to review the most complicated cases. Bernstein shares that the concept for the Tumor Board came from the desire to enhance cooperation between US and China physicians.

While UPMC has made great strides over the past decade in China, Bernstein concedes that there are many challenges to implementing a patient-centric health model in a country with a clinical environment geared to deliver high-acuity care. Elaborating, he explains that “Currently, the Chinese market is largely public-driven in terms of both care delivery (over 97% of tertiary hospitals) as well as medical insurance (over 98% of the public covered with public universal coverage). The understandable objective of the Chinese government is to allocate and deliver a limited amount of healthcare resources over a very large population, and it has been quite effective in improving public health based on several metrics, including increased life expectancy and reduced infant and maternal mortality.” He goes on, “The challenge is that the regulations governing both public and private hospitals are largely designed with this high-volume public health task in mind, and less concerned with introducing new treatments, and whole disease management, quality of patient experience. This also provides an opportunity to the extent that we can manage to deliver such services in a regulatory environment not necessarily geared to deliver such services.” To deal with these challenges, Bernstein says the key to success is to create a cross-cultural team that can work with stakeholders, to find innovative solutions to deliver the type of patient-focused care they desire. Fortunately, he says, the Chinese government has been supportive. “The Chinese government is promoting the entry of private capital into the healthcare system. Our main lesson learned is the importance of aligning with the initiatives of government policy makers, which may not always be intuitive, which points to the need for frequent regular informal communications with government, and not just reaching out to government when we need something.” He continues, “In addition, we invest heavily in supporting the educational mission of our regulators, providing expert speakers whenever possible, to demonstrate our commitment to raising the entire capability level of healthcare providers, especially those with significant needs for improvement, ultimately benefiting society.”

Contributing to China’s Healthcare Landscape

UPMC’s business model as both a hospital and insurance provider with extensive experience in managing data has allowed the company to expand its strategic partnerships outside the healthcare realm. Bernstein shares that the organization has recently signed a contract in the US with Microsoft. He says, “I think it’s interesting, because as the largest US academic medical center, we have strategic level partnerships with lots of large players. I recently talked to someone from Microsoft’s China team and he was not aware of the partnership, because it was mainly a US partnership – but he was excited because now here’s an opportunity for both Microsoft and UPMC, to communicate to the China market how we’re different.” He explains, “For UPMC, as a hospital and integrated insurance company we have over 2,000 IT employees within our organization alone, we’re utilizing technology and leveraging data. And for a company like Microsoft, they are more than just a tech company, they also have a deep understanding of healthcare.” As Bernstein notes, this kind of cross-industry collaboration is a unique value-add that many US companies can bring to China to benefit the larger market – not only within their industry, but also crossing sectors.

Corporate wellness is another area where Bernstein sees opportunity in China. “First of all, it’s something we’re very experienced in within the US. We have a company called Workpartners that has over 14,000 corporate clients. Workpartners provides sophisticated workplace services to improve both the physical and mental health of employees.” Bernstein regards corporate wellness as an important emerging field, due in part to the intense competition for talent amongst employers, and the great emphasis that Chinese professionals place on health and wellness services. Furthermore, in an inflationary environment, employee turnover, sick leave and absenteeism have an even greater financial impact on the bottom line. He notes that, “Given China’s demographic shifts, young professionals are caring for three generations health needs, and doing so, largely relying on a dominant public system which lacks transparency, requires tremendous amounts of ‘downtime’ while waiting for care, and a relatively poor patient experience. Improved corporate health enables employers to demonstrate their commitment to top talent.” From his experience in working with many Fortune 500 companies for corporate health, Bernstein says the “last mile” is the most critical. He observes that, “UPMC can leverage a wealth of data from our medical services and health insurance subsidiaries to come up with predictive solutions for corporate clients, but these solutions are only as good as the impact they deliver. Workpartners continues to develop integrated tools to make accessing health support easier and more efficient, with a very easy-to-use user interface, which caters to the interest of employees to improve their wellness and employee engagement.” The experience brings dual rewards, says Bernstein. “Our corporate partners have been satisfied with savings in excess of their expectations, not only in terms of reducing direct insurance premium costs over time, but reduced absenteeism and downtime.”