Behind the Baidu Scandal: Baidu and the Putian Medical Group

The scandal revolving around Wei Zexi, the 21-year-old cancer patient who died after finding misleading treatment information on search engine Baidu, has uncovered a huge Chinese profit-driven healthcare market, in which Baidu and Putian Medical Group are running the show.

Baidu has been making headlines for the past days for its alleged involvement in the death of the 21-year-old cancer patient Wei Zexi. Wei, a frequent visitor of China’s online forum Zhihu.com, spent 200,000 RMB to receive an ineffective and contested form of immunotherapy at the Beijing Armed Police Corps No. 2 Hospital (武警二院) – a treatment that was promoted on China’s leading search engine Baidu.

Wei’s death sparked controversy on Chinese social media, where netizens are angered about Baidu’s practices of allowing medical institutions to pay to be prominently featured in their search results.
 


 
Further investigation has now exposed that the hospital where Wei was treated subcontracted the controversial therapy to the Putian Medical Group, which dominates most of China’s private hospitals.

Most Chinese are familiar with these hospitals or services, although they might not be aware of the fact they belong to the Putian group. Now that the relations between Baidu and Putian have become the focus of public attention, this might soon change.

A list of affiliated clinics and hospitals has become trending on Weibo under the hashtag ‘List of names of Putian Medical Group’ (#莆田系医院名单#).

Putian Medical Group

The Putian Medical Group (莆田系医院) refers to an organized group of entrepreneurs that originally come from the city of Putian, Fujian province, and who have set up private hospitals all over China. They specialize in anything varying from plastic surgery to gynecology, skin conditions or infertility clinics, but have become especially well-known for their treatment of sexually transmitted diseases (STDs).

How did one Chinese city become so influential in China’s healthcare industry? The city of Putian since long has a tradition of folk medicine, but Putian’s current monopoly in China’s private healthcare system goes back to the 1980s when a man called Chen Daliang came up with a successful remedy for treating scabies. In a post-Mao era where healthcare knowledge and facilities was fairly limited, Chen trained pupils from his town to also treat all kinds of diseases with limited medical knowledge. Putian soon grew into a town of ‘medical practitioners’.

Putian’s people discovered a medical goldmine by treating stigmatized conditions (such as STD’s) that were rarely treated at public hospitals. Throughout the 1990s, the medical network of Putian was opening up clinics across China. These hospitals were amongst the first to advertise their treatments (Week in China 2014).

In the 1990s, they also signed contracts with public hospitals to run specific departments. This system, known as the “hospital within a hospital”, was implemented all around China.

According to China Daily (2014), the Putian Medical Group sparked controversy in 1998 when bottles of medicine for STDs worth 10 RMB (1.5$) were discovered to be sold for 200 RMD (31$). A report by consumer advocate Wang Hai also questioned the Putian’s group eligibility and qualifications after healthy patients were reportedly diagnosed with STDs.

Despite controversy, the Putian group is the main player on China’s private healthcare market; of China’s 12000+ private hospitals, they hold around 8600 member hospitals – owning about 80% of all private hospitals in China.

Close ties between Baidu and Putian

The Putian Medical Group has helped Baidu make a fortune. Already in 2013, Putian’s Communist Party chief stated that Putian hospitals may have contributed 12 billion RMB (1.8 billion US$) of the total of 26 billion RMB (4 billion US$) in ad revenues reported by Baidu that year (Caixin 2015).

On the other hand, it is also because of Baidu’s top-ranking advertising space that the Putian Medical Group has been able to further expand their business and gain high profits within China’s healthcare industry. In this way, the online search engine and the medical group have a close-knit and mutually profitable relation.

According to a Caixin report from 2015, Baidu and Putian group previously had a dispute about Baidu’s “exorbitant fees”, after which 98% of Putian’s hospitals boycotted the search engine.

Baidu initially said that the boycott was a response to Baidu’s decision to block all Putian hospitals that had too many consumer complaints or were in violation of industrial regulations. But, Caixin wrote, a source at a Putian claimed that Baidu had pressured the hospitals to increase their ad spending by 10 to 20 percent annually. No matter what the source of their muddy dispute was, it was later solved and both parties continued their cooperation.

Taking advantage of patients

The qualifications of Putian-led hospitals are again questioned now that Chinese netizens expose that these clinics put commercial interests above the health of their patients. Well-known WeChat blogger Xinwenge (新闻哥) reported about the Baidu scandal on May 3, after which the blog received over 5000 messages, with many people sharing their personal experiences on how they were previously duped by healthcare providers linked to the Putian Medical Group.

Xinwenge shared a selection of the reactions of Chinese netizens, with many recounting how their appointment at a Putian-related clinic had cost them a lot of money even when the public hospital doctor later diagnosed they had no health problems.

Amongst the many messages were also those of people who previously worked at Putian hospitals. Some told that the expert doctors that were advertised in reality did not even work at the clinics, and that the staff was not qualified to do the abortion procedures they offered.

Sina News reported how a doctor was fired in 2005 for refusing to give out extremely high-priced prescriptions to patients.

Throughout the years, many patients have previously reported the Putian group for fraudulent affairs, Xinwenge writes. Although this has been covered by Chinese media, it has not changed anything about the conditions of these hospitals and their staff.

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Most patients reportedly end up in a Putian-related clinic because they saw one of their ads, either on the Internet, on the television or in newspapers.

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For now, Baidu is under investigation, and the hospital where Wei Zexi was treated has closed its doors after an investigation by the health ministry.

On Weibo, many netizens are shocked with the facts that have been exposed over the past few days: “The Wei Zexi affair has exposed different evil actors,” one netizen writes: “First, the swindlers of Putian Medical Group; second, the hospitals; third, the administrative health inspecting departments; fourth, those responsible for the Internet. In the fifth place, it is Baidu and other such platforms who are responsible.”

“There are people saying that Baidu has no fault in this, that the hospital has no fault in this, and that only the cancer is to blame,” one Weibo user says about the Wei Zexi affair: “But this is just an excuse for Baidu and the Putian medical group to continue selling people hope to incurable diseases.”

– By Manya Koetse

Featured image: by Xinwenge.

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Author

About the author: Manya Koetse is the editor-in-chief of www.whatsonweibo.com. She is a writer and consultant (Sinologist, MPhil) on social trends in China, with a focus on social media and digital developments, Sino-Japanese relations and gender issues. Contact at manya@whatsonweibo.com, or follow on Twitter.

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