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TV exposé shows famous China hospital in kickbacks scheme

In just ten days, Gaozhou People’s Hospital in Guangdong Province went from being held up as a model of affordable, corruption-free healthcare to the subject of a graft investigation led by a special task force.
 
The catalyst for this whiplash-inducing shift was a January 12 and 13 China Central Television (CCTV) hidden-camera exposé showing a Gaozhou People’s Hospital doctor taking kickbacks of up to 20 percent on pharmaceutical sales.
 
After the CCTV coverage, the Gaozhou government had to walk back its boast about its medical system’s “excellent nationwide reputation,” aired in a January 3 press release.
 
Three department heads from the hospital were detained following investigations by the authorities.
 
The Ministry of Health ordered the Guangdong Provincial Health Department to form a task force to investigate the case.
 
In a September 2011 special report by state-owned media agency Xinhua, Gaozhou People’s Hospital director Ye Guanrui proudly explained the hospital had driven down medical bills by eradicating unnecessary prescriptions and procedures, and prohibiting doctors from accepting bribes and kickbacks.
 
The 2011 report also gushed over the hospital’s international clientele, saying patients from the United States, Tanzania, and Indonesia had been treated there.

Source: Southern Metropolis Daily (南方都市报), China Economic Weekly (中国经济周刊), Xinhua News (新华社), Yangcheng Evening News (羊城晚报)

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A version of this post first appeared in the China Compliance Digest. For a limited time, subscribers to China Compliance Digest will receive the China Anti-Corruption Handbook (normally $750) and FCPA Blog membership (normally $495) at no extra charge. Details are here.

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