What’s happening at ParkwayHealth Shanghai?

Posted by Damjan DeNoble

[Note: A response to this article by Dr. Jonathan Seah, former President of ParkwayHealth in China, can be found here.]

A few months ago we posted an interview by Shanghai television station ICS with then President (CEO) of ParkwayHealth China & North Asia Division, .   However, shortly after that interview was given, Dr. Seah was out at ParkwayHealth and into another job with Living Ventures,  ”a venture capital management company investing in high-growth consumer businesses within the Health, Medical, Wellness, Beauty, Nutrition, and Human Potential sectors, in China and other parts of Asia.”

The reasons behind the split with Mr. Seah and ParkwayHealth were unclear, but we heard from people in the Shanghai health care community that the move was not initiated by Dr. Seah, and that it was a very big mistake on the part of ParkwayHealth Group. Whatever the case, the move seemed unnatural, considering it came only a year and half after Parkway shelled out USD 42 million for the acquisition of World Link, a network of medical and dental centers headquartered in Shanghai, in mid 2007; and less than a year after Dr. Seah was dubbed “the China guy for ParkwayHealth” by a February 2008 Forbes article. If anything, now would seem a critical period to retain an experienced leader.

Since his departure at the very end of  2008, ParkwayHealth in Shanghai has been the target of ever louder complaints by the city’s expats for what is widely perceived to be a bad value proposition. A posting on a Shanghai expat forum recently warned,

I have been very happy to be a patient at the World Link Shanghai already over 6 years, but recent ownership change has changed all…It is quite astonishing how company culture can effect to the service quality…Their website looks nice and must have cost a fortune. I hope they can also invest some money to train their bulldog style billing and management stuff also before they chase all of their long term paying customers away…

And, a few days ago, I noticed a twitter stream (that was the second of its kind by him in as many weeks) from , a Dutch entrepreneur in Shanghai (CEO of Spil Games Asia, co-founder of Tudou.com and angel investor in Chinese start-ups), decribing an unpleasant experience at a ParkwayHealth clinic;

Thinking about short term goals only leads to problems in the long run. Their PR is not good, most people I talk to are negative about them.
11:23 AM Mar 31st from mobile web Told her a.o. to inform patients how long they have to wait and explained about supply and demand (they don’t have enough doctors)
11:22 AM Mar 31st from mobile web Gave the manager at ParkwayHealth some free advice. Not sure if it helps, she did not come across as a very capable manager.
11:20 AM Mar 31st from mobile web Don’t like to do it this way, but it works.
11:06 AM Mar 31st from mobile web Going to meet with the manager of ParkwayHealth, making a fuss about the 1 hr waiting time got us into the doctor’s office straight away.
11:04 AM Mar 31st from mobile web Other patients are also starting to complain now about ParkwayHealth waiting times. They should make timeslots per patient visit longer.
10:44 AM Mar 31st from mobile web

Before ParkwayHealth took over WorldLink last year the atmosphere was better and we did not have to wait as long. They run it as a business.
10:36 AM Mar 31st from mobile web

Depends on who you talk to. We thought about changing but decided to stay, too much hassle. Our doctor is very good.
10:33 AM Mar 31st from mobile web

Too bad ParkwayHealth does not screen Twitter. They overcharge and under-service, at least let us know how long we need to wait.
10:21 AM Mar 31st from mobile web

At ParkWay Health for my wife’s pre-natal check-up and once again they keep us waiting. Each time we’re here it happens and I tweet about it
10:19 AM Mar 31st from mobile web

The common strand in both the twitter and the forum complaints is that ParkwayHealth is badly managed, particularly in the billing arena, and that it takes too long to see a doctor.  Coincidentally, these are the same problems reported by expats who use United Hospital systems, Beijing and Shanghai’s other large hospital/clinic group.

Mr. Marc van der Chijs offers the manager advice on how her clinic’s service could be improved, but ultimately the problem could be out of her hands.  Rather, the trouble stems from the inherent difficulty in recruiting good managerial and medical talent from abroad to come to China AND the insistence of entities like ParkwayHealth to base their business models on that of western, insurance driven private hospitals.

By doing this, you leave yourself vulnerable because you are, in effect,  limiting the hospital’s client base to expats with private insurance and some, but certainly not all, well to do Chinese and expats who do not have private insurance but can afford to pay out of pocket.  It might be possible to break even under some circumstances with this model, but probably not possible to do well and pay top talent (again, both administrative and medical), or even to pay enough mediocre and average talent in order to fully and efficiently staff the hospital.

I’m not trying to say that expats are getting duped, but I am saying (and I’ve said it before) that there are better options out there for expats.  Putting up an expat friendly lobby with English speaking nurses, and showing a list of twenty accepted insurers is not going to cut it for much longer.  Less smoke and mirrors, more substance, please, (especially for 100 dollars or more per check up).

What makes all of this ironic, is that Dr. Seah himself pinpointed these shortcoming in that February 2008 Forbes article.  First, Dr. Seah talked very eloquently about the barriers, both clear and hidden, to running a health care company in China.

“There are many half-built and empty new hospitals in cities all across China.” says Dr. Seah, who ascribes the problem mainly to “financial investors who don’t understand health care and the costs and time involved, and have run out of financing in the middle of projects.” But, he adds, “Even today no one in the country knows how the system works in every regard–it changes all the time.”

And he also pointed out how expensive the war for talent can be on both the consumer and the hospital;

“Our general practitioner fees in Singapore are about s$40 to s$50. In China it’s about s$150 to s$200. That’s because it’s so hard to get good doctors.” Parkway specialist doctors are usually fully booked, with a waiting period of about three weeks. About 80% of the company’s doctors in China come from overseas.

…

“Another challenge we constantly have is similar to what I saw in the Bay Area in the late 1990s–a war for talent. It is very difficult to recruit and retain good managers. This is especially true with regard to managers who are younger and looking for get-rich-quick opportunities with startups benefiting from the rapid pace of growth in China.”

Indeed, Dr. Seah seemed attuned to all the problems now being expressed by ParkwayHealth’s patients.    So perhaps, Dr. Seah’s leaving ParkwayHealth Group had something to do with financial investors who didn’t understand health care and the costs and time involved?  And, maybe,  in turn,  those same financial investors chose to hire, in Dr. Seah’s stead, younger managers looking for get-rich-quick opportunities,  causing ParkwayHealth brand PR to plummet in an apparent downward spiral? Whatever the case, it doesn’t seem to have been the right move to let Dr. Seah leave, and ParkwayHealth is paying for it with a diminished reputation.

As always, I’m no expert, but this is what I’m seeing out there, folks.  Chime in with your comments.