Use of digital Yuan in health care in china

digital Yuan

China has launched a pilot program for its CBDC project in some urban areas, including Shijiazhuang, Hebei, Nanjing, and Wuhan. Despite its possible pitfalls, using a CBDC counter-party is essential to make patients receive treatment benefits faster; using digital currency to transfer funds between parties has been an advantage for many healthcare providers, making it easier to minimize costs with secure and secure and instant money transfers. As of this week, the electronic yuan is entering a completely new realm with the launch of its new digital currency.

 Its launch of the pilot test in Changsha also indicates the country’s plans to implement a national CBDC system eventually. However, China is not alone in its efforts to develop a central bank digital currency (CBDC) system; other nations, such as India and South Korea, have also shown interest in using CBDC.

A central bank digital currency could bring advantages to the healthcare sector by encouraging financial inclusion and developing digital health payment systems. However, like any other industry, a country should take time to implement a CBDC system. 

Although the Chinese government has not announced the launch of their digital currency in Changsha yet, a digital yuan could encourage health insurance companies to provide Medicare cards so that customers can pay for medical treatments and medicines through digital payment systems such as WeChat Pay and Alipay. When the Central Bank of China launched CBDC in Shijiazhuang, a local health insurance company could cut costs by 14% by using its commercial branch to manage medical claims for urban and rural residents. Let’s discuss the use of digital yuan in healthcare:

Incentivization with digital Yuan:

A significant incentive for health insurance companies to adopt digital payment systems is the use of digital yuan. Any health insurance company that can utilize its commercial branches and leverage WeChat Pay and Alipay’s commercial distribution channels would be able to reduce administrative costs. If the company can utilize its commercial branches effectively, it can be an advantage for providing health benefits at a lower cost for its customers in terms of administrative costs.

Cities that are easy to navigate with digital maps:

To increase healthcare coverage, China launched a trial project of digitizing road map images in July 2016. Under the project, 3,000 maps were digitized across 31 cities. Besides that, ten municipalities have created a digital road map system for drivers, and drivers in four out of seven regions have been using the system since last year. 

Digital maps offer an advantage to patients in cities where they can quickly and conveniently locate hospitals near them. Overall, China’s digital healthcare payment system is paving the way for faster and more efficient healthcare payment systems. Also, the digital yuan can make it easy for China to expand its healthcare coverage to rural residents.

Digital Yuan can increase healthcare coverage in rural areas:

In 2016, China reaped about a third of its gross domestic product (GDP) and saw a growth of 7.3%. However, its rapid growth has brought challenges in the form of slower economic growth and income inequality. In addition, the incomes of rural residents in China are much lower than their urban counterparts. It indicates that rural residents need help to access healthcare services as quickly as their urban counterparts. Using WeChat Pay, Alipay, and other digital payment systems for health services reduces the cost of financial inclusion for all citizens in China.

Specifically, using digital yuan could help patients access better and more affordable healthcare via instant money transfers. In addition, using the digital currency system could eradicate corruption in health care systems when a hospital or medical practitioner can be paid directly by a patient via electronic payments such as WeChat pay and Alipay.

Tracking Healthcare Digital Records with digital yuan:

China has become the largest healthcare market in the world, but it still needs to catch up on quality healthcare. To achieve this goal, a significant step has been made to improve medical technology, which is becoming essential in promoting income growth. 

As a result, using digital yuan in healthcare can help establish new and more efficient healthcare systems in China. For example, one study found that almost all hospitals need to catch up in implementing electronic medical records (EMR). It indicates that low-cost EMR systems have the potential to reduce costs and deliver better services for medical consumers across the country.

In a centralized system, all funds are kept by the insurance company and are used to pay for medical services. If a hospital with a low cost can provide quality services and maintain a high credit rating, an insurance company will be willing to send more patients to that hospital since they know they can pay back those costs with their share of the funds from the CBDC. Under this scenario, when it comes time for settlement between an insurer and hospital, all medical records and treatments will already have been recorded on blockchain technology.

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