On March 15, 2022, Ping An Healthcare Technology Co., Ltd. (ping An Good Doctor, 1833.HK) announced its 2021 annual results.
Among them, the contribution income of medical services reached 2.288 billion yuan, accounting for 31.2% of the total income, with a growth rate of 8%; the contribution income of health services was 5.046 billion yuan, accounting for 68.8% of the total income, with a growth rate of 6.3%. In the vast blue ocean of Internet medical treatment, Ping An Health focuses on the growth of B-end users, opens up internal and external channels, deepens the iterative upgrading of HMO health management + family doctor membership system + O2O medical service business model, and boosts the customized health management of enterprise employees and the exploration of the closed-loop ecology of Internet medical care.
Figure 1: Ping An health services and health services contributed revenue and gross profit performance in 2021
Workplace Health: An important part of controlling health risks for all
In the fast-paced modern workplace, "people" and "karma" are mutually successful. With the acceleration of industrialization, urbanization and population aging, workers are facing a complex situation of multiple disease threats and a variety of health influencing factors, and the health management of enterprise employees is increasingly entering people's field of vision and has received widespread attention from society. In the "Healthy China Action (2019-2030)", it is proposed to carry out occupational health protection actions and take the construction of healthy enterprises as an important part of the construction of healthy cities. It can be seen that workplace health has become a key part of controlling the health risks of the whole people.
Recognizing this, enterprises will "do their homework" in strengthening employee health management and improving the health quality of employees. In fact, health management has such a consensus for any business and individual, that is, 90% and 10%. In short, after 90% of individuals and enterprises passed health management, medical expenses dropped to 10%; while 10% of individuals and enterprises did not do health management, and medical expenses increased by 90% compared with the original. Therefore, for enterprises, employee health management can reduce medical costs by focusing on the health status of employees to "cure diseases". In addition, it can also be used as a welfare measure for enterprises to attract and retain outstanding talents who pursue health and career "double hundred", which will also become one of the sharp weapons for enterprises to participate in market competition.
However, employee health management products derived from the needs of the majority of markets are mixed, and there are general problems such as a single system, decentralized services, and homogenization of products. Based on this background, how to optimize the business operation mode of "medical security" and "health management" integration, bringing solutions with higher levels, wider coverage processes, and customized service content, Ping An Health provides a reference for the technology version of "Joint Health" based on the HMO model, and the 310 million-person enterprise employee market has also become its "second engine".
Strategy 2.0 upgrade: Create a customized health management plan for enterprise employees
At present, there are two major development models of health management in China, one is based on the medical institution model of public or private hospitals, and the other is the health insurance model with medical insurance as the main body, which draws on the underlying logic of the HMO model HMO model originates from the United States, in short, in a health maintenance organization system, while integrating and opening up insurance companies, hospital groups and doctor groups.
In October 2021, based on the layout of "insurance + medical health", Ping An Health proposed to launch the strategy 2.0 deepening plan of HMO + family doctor + O2O, which is benchmarked against the United Health Group of the United States (hereinafter referred to as "United Health") on the other side of the ocean. United Health, which has long been the leader in the industry, has become a benchmark in the global insurance industry with the "insurance + service" business model. In 2021, United Health's revenue was US$287.6 billion, up to 1.83 trillion yuan, of which the important profit was derived from the health service business.
Since the strategic upgrade, Ping An Health has formed three major product categories: employee physical examination, employee health management, and corporate welfare exchange platform, and created a number of large-scale enterprise customized cooperation projects such as Huawei's exclusive project and "Easy Enterprise Health". Among them, "Yiqi Health" and Ping An Pension Insurance have in-depth cooperation to customize exclusive health activities for enterprises on demand, including expert health lectures, employee inter-work exercises, shoulder and neck massage, spine maintenance and other corporate health services, as well as the establishment of smart infirmary services for enterprises.
Fang Weihao, Chairman of the Board and CEO of Ping An Healthcare Technology Co., Ltd., said: "For some enterprises with medical fund pools, we can provide a richer selection of medical and health products around the fund pool. "In 2022, Ping An Health will continue to upgrade its employee physical examination products to create an enterprise-level health management model."
Market perspective: B-end internal and external channels work together to build an Internet medical ecosystem
In view of the core pain points such as the imbalance between supply and demand resources, the gap in high-quality medical care, the low utilization rate of resources, and the asymmetry of supply and demand information at this stage of the market, Ping An Health has made precise efforts in terms of expansion mode, O2O ecosystem construction, medical services and quality control.
As a kind of "market imagination", the service model directly facing the C-end cannot achieve long-term large-scale profitability, which has almost become the consensus of the industry, so focusing on B-end users may become a way to break the game. Taking Ping An Health as an example, the B-end users of its development and services are mainly divided into internal insurance financial channels and huge external market channels. In the internal market alone, through high-value customers in integrated financial businesses such as Ping An Bank and Ping An Puhui, Ping An Health can achieve efficient drainage of 225 million high-quality financial customers. Looking at external enterprises, as of the first half of 2021, Ping An Health has served more than one million employees, and the number of employees in enterprises including central enterprises, state-owned enterprises, foreign-funded and private enterprises in the country has 310 million people, so internal and external channels are working together, and the potential of expanding customers cannot be underestimated.
In the construction of the O2O ecosystem, Ping An Health has carried out strategic upgrades at multiple levels such as service control, personnel control, process control and environmental control, connecting online and offline resources and connecting thousands of hospitals, fitness institutions, physical examination centers and inspection centers. In addition, Ping An Health relies on its rich online and offline medical resource network and quality control team to link high-quality medical services for enterprises. Fang Weihao said: "The company's internal medical quality control team has significantly improved the error rate of case quality and medical quality, and at the same time clarified the constraints and requirements. We now have a Grade A rate of case quality that has risen to more than 98%. "As of December 31, 2021, there were more than 3,600 ping an health cooperative hospitals, of which more than 50% were top-3 hospitals; the number of cooperative pharmacies reached 202,000, with a national coverage rate of about 34%,; more than 225 central warehouses were laid out and one-hour drug delivery was achieved in 140 cities; the number of cooperative physical examination institutions has exceeded 1,700, and the number of cooperative health institutions has reached 96,000."
We can't control and predict the market, but if we liken every turmoil to a series of cards, all companies can do is maximize resource synergy. Based on such an Internet medical ecosystem that condenses internal and external high-quality customers, whole-process health management, and one-stop customized products and services, the synergy behind it will help promote the optimal allocation of medical resources in the whole society, so as to achieve a win-win situation for individuals, enterprises, hospitals and society. In the face of each card, whether it is good or bad, open a new game in the change, waiting for the "flywheel effect" it brings.
Figure 2: A picture to read the 2021 Ping An Health Financial Report