China’s National Healthcare Security Administration (NHSA) has announced a major smart payment reform that will directly impact hospital billing and administrative operations across the country’s medical insurance system. The initiative, published in an official notice and reported in regional industry media, introduces an integrated set of digital payment options, including facial recognition, QR code, mobile and credit-based payment methods, to streamline how patients settle bills for outpatient, emergency and inpatient services under the national medical insurance framework.[3] This marks a significant development for healthcare management and healthcare IT leaders in hospitals, who are grappling with mounting patient volumes, operational bottlenecks, and growing expectations for digital service efficiency.

Under the current system, patients often endure long queues and fragmented billing workflows, as they must complete medical insurance reimbursement, personal account payments and out-of-pocket settlements separately when receiving treatment.[3] For hospital administrators, this fragmented process not only creates crowding at payment counters, but also increases staff workload, reconciliation complexity, and the risk of billing errors. The NHSA’s unified smart payment reform aims to consolidate these payment streams into a single, streamlined process. With QR code-based payment, for example, patients will be able to handle reimbursement, personal account deductions and self-pay balances through one scan, simplifying end-to-end settlement and reducing the need for multiple service points within hospital premises.[3]

For healthcare facility managers and CIOs, the reform will require hospitals to integrate their existing hospital information systems (HIS), billing systems and medical insurance interfaces with the new unified payment infrastructure. The NHSA has indicated that the reform will begin with a pilot phase, selecting cities based on the maturity of their digital infrastructure and readiness for reform.[3] This implies that larger tertiary hospitals and digitally advanced urban facilities may be among the first adopters, serving as reference sites for subsequent nationwide scaling. Hospital IT departments will need to address interoperability, data exchange standards, and real-time eligibility and payment verification mechanisms in partnership with government platforms and third-party technology vendors.

A key feature of the reform is the introduction of facial recognition payment, which allows patients to complete both identity verification and payment without needing physical cards or smartphones.[3] This capability is particularly relevant for elderly patients or those unfamiliar with digital devices, a demographic that represents a sizeable share of hospital service users in China due to population aging and the high prevalence of chronic disease. For hospital management, deploying facial recognition terminals at registration desks, outpatient windows or self-service kiosks could reduce manual identity checks, accelerate patient throughput and potentially lower staffing requirements at front-desk service points. However, it will also require investment in hardware, workflow redesign, staff training and clear communication with patients about how to use the technology.

Mobile payment channels, including apps and mini-programs, will also be expanded under the NHSA initiative.[3] This will enable patients to complete the entire payment process online, including pre-visit registration, co-pay settlement and post-visit reimbursement, reducing the need for physical presence at hospital counters for financial transactions. For hospitals, broader mobile payment adoption can help flatten peak-time congestion, facilitate digital queuing models and support more flexible appointment and telemedicine service integration. From a revenue cycle perspective, mobile payments can improve payment collection rates and reduce cash handling, while giving finance departments better real-time visibility into receivables and cash flow.

The credit-based payment option may be particularly transformative for hospital finance and patient access strategies. This mechanism allows patients to “receive treatment first and pay later,” providing a structured form of short-term credit for medical services.[3] For hospital executives, this could help reduce cases where patients delay or avoid necessary treatment due to immediate financial constraints, potentially improving bed utilization and clinical outcomes. However, it also introduces new considerations around credit risk management, settlement timing, and coordination with financial institutions or platform providers that underwrite the credit. Hospitals will need clear contractual and technical frameworks to ensure timely reimbursement and to minimize bad-debt exposure under this model.

The NHSA has emphasized that while new smart payment options are being introduced, robust data security, privacy protection and risk control mechanisms must be implemented in parallel.[3] This places cybersecurity and compliance squarely on the agenda of hospital IT and compliance leaders. Facial recognition and integrated payment systems will generate and process highly sensitive personal data, including biometric identifiers and financial information. Hospitals will therefore need to align their systems and processes with national data protection requirements, implement strong access controls, encryption and auditing, and ensure that third-party technology partners adhere to the same standards. Effective governance will be critical to maintaining public trust and avoiding regulatory penalties or reputational damage.

From a strategic management perspective, the reform represents an important step in China’s broader push toward digital and smart healthcare. By standardizing and scaling smart payment solutions across outpatient, emergency and inpatient care, the policy will likely accelerate hospitals’ ongoing digital transformation, especially in the domains of healthcare information technology, healthcare management and facilities management. Hospitals participating in the pilots can expect closer collaboration with local healthcare security bureaus, IT providers and payment platforms to design, configure and optimize workflows. Lessons learned from these pilots will inform subsequent national rollout, influencing future technical standards, interface requirements and operational best practices.

Operationally, hospital leaders should anticipate a transition phase in which legacy payment processes and new smart options coexist. This will require careful change management: educating patients about new options, retraining front-line staff, updating signage and communication materials, and reconfiguring physical spaces such as cashier areas and self-service zones. Over time, as adoption grows, hospitals may be able to repurpose or reduce traditional payment counters and redirect staff to higher-value tasks such as patient navigation, financial counseling and quality improvement initiatives. The reform may also catalyze broader use of digital identity and one-stop service models within hospitals, linking registration, triage, billing and discharge processes more tightly.

For vendors and service providers in the hospital ecosystem, the NHSA smart payment reform creates new demand for integrated payment modules, biometric authentication solutions, secure network infrastructure, and consulting services around workflow redesign and compliance. Companies specializing in healthcare IT integration, payment gateways, identity management and patient self-service technologies will find new opportunities to partner with hospitals and regional health authorities. As the NHSA aims to cover all eligible medical institutions nationwide within three years, the scale of required deployment will be substantial, particularly for large multi-hospital groups and public hospital networks.[3] This environment will reward vendors that can meet stringent security, interoperability and performance requirements while supporting local customization and ongoing support.

In sum, China’s move to expand smart payment options under the national medical insurance system is much more than a consumer convenience initiative; it is a structural reform with direct implications for hospital operations, financial management, digital infrastructure and patient flow. By integrating facial recognition, QR code, mobile and credit-based payments into a unified framework, the NHSA is pushing hospitals to modernize their payment and billing ecosystems, reduce administrative friction, and align with national digital health priorities. Hospital administrators, CIOs, finance directors and procurement teams across China—and international partners watching the market—will need to monitor pilot outcomes closely and prepare their organizations for the upcoming nationwide scaling of this reform.