Telemedicine: A Long Way to Go

On 29 August 2014, the National Health and Family Planning Commission issued a new circular entitled “Opinion on Pushing Forward Telemedicine Services of Medical Institutes”, which expands the scope of permitted telemedicine services. However, the question of how the guidelines contained in the circular will be implemented remains unclear.

The concept of telemedicine was first introduced in China in 1999 in a Ministry of Health circular, which limited the scope of telemedicine to consultation between two medical institutes. Since the publication of the 1999 circular, the area of telemedicine has expanded considerably and according to statistics from the National Health and Family Planning Commission, as of 2013, there were 2,057 medical institutes which provided telemedicine services in China.

However, as the scope of telemedicine had expanded far beyond the original scope of the 1999 circular, a new circular to clarify the scope of telemedicine permitted in China and to promote new service models was required.

According to the new circular, telemedicine means medical activities where technical support is provided to the patient by a medical institute other than the medical institute in which they are treated, on the invitation of the treating institute. The technical support may be provided in the form of telecommunication, computer or web technology. More specifically, in addition to remote consultation services permitted by the 1999 circular, the new 2014 circular extends the scope of permitted services to remote pathological diagnosis, remote medical image diagnosis, remote monitoring, remote outpatient consultation, remote case discussion and other services which may be stipulated by provincial health and family planning commissions.

The circular also expressly acknowledges that direct examination, diagnosis, treatment, surgery and monitoring of patients through the accurate control of remote medical devices (such as robots) is not governed by the circular and that the National Health and Family Planning Commission will provide specific regulations and standards to deal with this.

The circular only provides general guidelines but the following issues are worthy of note:

1. Applicable conditions for medical institutes who carry out telemedicine services

The circular provides that in order to be able to carry out telemedicine services, a medical institute must comply with certain requirements relating to personnel, techniques, equipment and facilities.

However, there is currently no national regulation which governs the legal requirements for medical institutes who wish to offer telemedicine services, although local circulars covering this topic do exist. A draft regulation “Measures on telemedicine services” was proposed in 2011 for public consultation, although this has not yet been implemented in the form of binding legislation. In the absence of more detailed regulations, it may be difficult to assess which medical institutes are qualified to carry out telemedicine services.

2. Medical malpractice liability

The circular provides that a telemedicine cooperation agreement must be concluded between the cooperating medical institutes which stipulates the scope and purpose of the collaboration; how the collaboration will operate; the rights and obligations of the parties; and how the risks and liabilities are to be shared between them. Any dispute between the medical institutes arising from medical malpractice must be handled in accordance with the provisions of the cooperation agreement signed by the parties.

However, in the absence of specific provisions relating to telemedicine in the "Medical Malpractice Regulation", it is not clear whether each medical institute which provides telemedicine services will bear joint and several liability.

Although the circular provides that the host medical institute that wishes to use telemedicine must fully notify the patient and obtain his/her prior written consent or the consent of his/her legal guardian or close relative (as the case may be), without proper regulation of the liability between the parties, a simple obligation of notification and consent will not be adequate to protect the interests of the patient in the event of medical malpractice.

Since it is possible that communications between institutes as a result of telemedicine activities may be recorded on the internet, medical institutes may be reluctant to embrace telemedicine until the potential exposure to medical malpractice liability has been clarified.

3. Telemedicine provided by foreign medical institutes

The circular also provides that medical institutes may carry out telemedicine services in cooperation with foreign medical institutes in accordance with the circular.

However, it should be noted that this provision is in violation of the “Tentative Measures on the Administration of Sino-Foreign Equity and Contractual Medical Institutes” regulation effective since 1 July 2000. According to Article 33 of the Tentative Measures regulation, if any party contracts with a foreign medical institute in order to carry out diagnostic projects in any form whatsoever without approval of the authorities, this will be considered illegal and the parties will be subject to the sanctions prescribed in the Medical Institutes Administration Regulations (for further information, please refer to our newsletter on our website www.cmslegal.cn entitled: "Groundbreaking Establishment of the First Wholly Foreign Invested Hospital Project in China (Shanghai) Pilot Free Trade Zone").

4. Online consultation

The circular does not contain comprehensive provisions governing online consultation provided by doctors to patients although it does provide some guidance. If a doctor wishes to provide telemedicine to a patient who is not the patient of the medical institute in which he/she works, the following conditions must be met:

• the prior written consent of the medical institute must be obtained; and
• the consultation must only be carried out through a centralized information platform of the medical institute.

This provision implies that any kind of consultation which may be provided by a doctor via a website other than the one operated by his/her medical institute is prohibited.

Further, obtaining the prior written consent of the medical institute is impractical, as in practice it is unlikely to be feasible for a doctor to seek prior approval each time he/she wishes to carry out an online consultation.

As a result of the legal constraints described above, it is therefore still unclear whether a doctor may actually provide online patient consultation, even through the website of the medical institute in which he/she works.

It is clear that there is increasing interest in telemedicine in China from hospitals, pharmaceutical manufacturers and even from e-commerce companies since it has the potential to deliver a new model of healthcare and increased convenience to Chinese patients, especially for those that live in rural areas. It may also lead to the development of new or improved technologies and new software applications relating to healthcare advice, as well as facilitating medical consultation, diagnosis and even patient treatment.

Although this new circular goes some way towards addressing some of the practical issues associated with the provision of telemedicine, it does not go nearly far enough. In particular, for the effective implementation of telemedicine in China, the following issues still require legislative clarification:

• the online sales of prescribed drugs, which are currently governed by the CFDA (a draft version of the Administrative Measures on the Sales of Food and Drugs on the Internet was published for public comments on 28 May 2014 and once enacted may completely change the current rules relating to the online sale of pharmaceuticals);
• the provision of prescriptions via the internet;
• new reimbursement rules applicable to telemedicine, in particular the introduction of a nationwide reimbursement policy;
• regulations relating to off-label use (an area not currently regulated in China);
• provisions relating to patient confidentiality and data protection; and
• reconciliation of the contradictory provisions governing the ability of foreign medical institutes to offer telemedicine.

Overall, it is clear that the current provisions governing telemedicine are still very underdeveloped. It follows that further clarification would be welcomed by investors, who are eager to explore this market further.