China Will Never Have Its Own Luigi Mangione

Luigi Mangione is taken into the Blair County Courthouse on Dec. 10.

On December 17, Luigi Mangione has been charged with first-degree murder in the killing of UnitedHealthcare CEO Brian Thompson, ABC reports the Federal charges could make him eligible for the death penalty. Many Americans see him as a hero, believing that he effectively warned the U.S. health insurance industry. Many Chinese netizens also call him the real Batman, but China may never have its own Luigi. In this episode, we will tell you why.

Many Americans hate UnitedHealthcare due to its stringent reimbursement policies, which often leave families paying high premiums while still being driven to bankruptcy by medical expenses. In fact, the goal of these commercial insurers is profit, not patient care, so almost every insurance company will try to avoid paying claims. This is why Luigi’s case has become a warning for the entire U.S. healthcare industry.

However, China’s healthcare system could never create a Luigi Mangione for two major reasons.

First, almost all of China’s medical insurance are managed by the government, with no profit motive involved. The Chinese government mandates that all employers pay for their employees’ healthcare costs, with the individual contribution amounting to only 2% of a person’s monthly salary. When paying for hospital services, such as hospitalization or surgery, the reimbursement rate can reach over 70%. Furthermore, starting from May 30 this year, if you are a veteran, you and your family will be eligible for 100% reimbursement when calling an ambulance.

These medical insurance funds are overseen by the National Healthcare Security Administration (NHSA). By 2023, the basic medical insurance program had covered over 1.33 billion people, accounting for 95% of China’s population. Additionally, the staff of the NHSA are government employees, with fixed salaries. This means that even if they delay patients’ paying claims, the savings won’t end up as a year-end bonus. Moreover, complaints can affect their promotions. So, as long as patients meet the reimbursement criteria, they are guaranteed to be fully reimbursed according to the law.

Second, China’s healthcare system has maintained stable operations. Chinese medical insurance can be used not only in hospitals but also at pharmacies. As of September this year, 3,088 medications have been included in the reimbursement list. According to the NHSA, this has helped 720 million Chinese patients save over $95 billion. The reason why China’s healthcare system hasn’t gone bankrupt is that the country has managed to significantly lower medical costs through two key methods.

First, since the NHSA manages nearly all medical insurance funds for Chinese citizens, it can leverage its large purchasing power to negotiate lower prices with pharmaceutical companies.

For instance, in 2021, China’s NHSA announced a centralized procurement of 210 million insulin pens—nearly four times the total amount sold in the U.S. in 2021.

Such a massive order attracted 11 pharmaceutical companies to bid in Shanghai. Ultimately, both Chinese and foreign pharmaceutical companies shared the $2.3 billion contract, with the price per unit dropping by 48% compared to market prices. This allowed Chinese diabetes patients to continue receiving affordable insulin pens, saving nearly $550 per year for each patient.

Second, imported medicines are often much more expensive than locally produced medications in China. Therefore, China is continually boosting its domestic production capacity for medications and medical devices to reduce healthcare costs.

For example, while all companies have lowered their prices, Chinese pharmaceutical companies have significantly outpaced foreign ones in price reductions. According to China Securities Journal, the average price reduction in centralized procurement was around 40%, but Chinese companies reduced their prices by as much as 60%. This is largely due to the fact that local sales save on transportation and tariff costs. Furthermore, according to China’s official media, its pharmaceutical R&D efficiency has been steadily improving over the past decade. With more medications being supplied domestically, China’s healthcare insurance is expected to further reduce spending.

Moreover, for some extremely expensive medical devices, Chinese manufacturers are offering more economical alternatives. For instance, before 2023, all Magnetic resonance imaging (MIR) machines in China had to be imported, and the average price of a machine was around $4 million. Additionally, over 90% of the replacement parts had to be imported, which led to extremely high maintenance costs—each examination would cost over $160, putting a significant pressure on China’s healthcare system.

But in 2023, China successfully developed and mass-produced domestic MRI machines, with each machine costing only $356,000. Because all core parts are locally produced, maintenance costs are significantly reduced. According to Global Times, the cost for a MIR with domestically produced equipment is less than $41 per scan. As more Chinese hospitals switch to domestic medical devices, the burden on China’s healthcare system will continue to decrease.

Under such a healthcare system, Chinese patients are affordable to undergo thorough medical exams and continue using effective medications. These efforts are reflected in the average life expectancy of Chinese citizens. According to WHO statistics, by 2021, life expectancy in China had risen to 77.6 years, significantly higher than the world average of 71.4 years. As a developing country recognized by the United Nations, China’s life expectancy even surpasses that of the world’s largest developed country—the U.S., which stands at 76.4 years.

In fact, the Chinese government is continuing to improve its healthcare system. While China’s healthcare system is not perfect, it remains the best option for most people. At least in China, people are unlikely to face the same kind of ruthless treatment from insurance companies like UnitedHealthcare. What truly creates people like Luigi, however, is the American healthcare system, which constantly pushes civilians into the hands of companies like UnitedHealthcare.