Shanghai's Lin-gang Special Area has emerged as a pioneer in the city's efforts to further open up the wholly foreign-invested hospital sector. As part of a broader pilot program aimed at enriching medical service supply and catering to diverse healthcare needs, Lin-gang has been designated as a key area for the establishment of such hospitals.

According to the pilot program, which was jointly formulated by the Shanghai Municipal Health Commission and other relevant departments, foreign investors are encouraged to set up hospitals (excluding traditional Chinese medicine hospitals and the acquisition of public hospitals) in designated areas such as Lin-gang Special Area, the free trade zone, the Hongqiao business district, and the eastern hub international business cooperation zone. Each of these special zones and expatriate-concentrated areas can accommodate up to two wholly foreign-invested hospitals.

To qualify for establishment, foreign investors must demonstrate advanced hospital management concepts, models, and service standards that are internationally recognized. They must also provide state-of-the-art medical technologies and equipment, while complementing or enhancing local healthcare capabilities, technologies, and facilities.

The hospitals, which can be for-profit or non-profit, are prohibited from operating in fields such as psychiatry, infectious diseases, hematology, traditional Chinese medicine (TCM), integrated traditional Chinese and Western medicine, and ethnic minority medicine.

Furthermore, the hospitals are restricted from engaging in high-risk medical and ethical activities, including organ transplantation, assisted reproductive technologies, prenatal screening and diagnosis, inpatient psychiatric treatment, and experimental treatments using tumor cell therapy. A minimum of 50 percent of the hospital's management and healthcare professionals must be Chinese mainland citizens, while foreign, Hong Kong, Macao, and Taiwan healthcare professionals are allowed to practice on a short-term basis.

The pilot program outlines stringent management measures, including strict adherence to laws and regulations governing the establishment and operation of foreign-invested hospitals. These hospitals must connect their information management systems to municipal and district medical service supervision platforms, with electronic medical records and medical equipment information stored within China. Additionally, hospitals that meet medical insurance requirements can apply to become designated medical insurance institutions and are encouraged to interface with domestic and international commercial health insurance schemes.