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Towards Universal Health Coverage via Social Health Insurance in China: Systemic Fragmentation, Reform Imperatives, and Policy Alternatives

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  • Alex Jingwei He

    (the Education University of Hong Kong)

  • Shaolong Wu

    (School of Public Health)

Abstract

China’s remarkable progress in building a comprehensive social health insurance (SHI) system was swift and impressive. Yet the country’s decentralized and incremental approach towards universal coverage has created a fragmented SHI system under which a series of structural deficiencies have emerged with negative impacts. First, contingent on local conditions and financing capacity, benefit packages vary considerably across schemes, leading to systematic inequity. Second, the existence of multiple schemes, complicated by massive migration, has resulted in weak portability of SHI, creating further barriers to access. Third, many individuals are enrolled on multiple schemes, which causes inefficient use of government subsidies. Moral hazard and adverse selection are not effectively managed. The Chinese government announced its blueprint for integrating the urban and rural resident schemes in early 2016, paving the way for the ultimate consolidation of all SHI schemes and equal benefits for all. This article proposes three policy alternatives to inform the consolidation: (1) a single-pool system at the prefectural level with significant government subsidies, (2) a dual-pool system at the prefectural level with risk-equalization mechanisms, and (3) a household approach without merging existing pools. Vertical integration to the provincial level is unlikely to happen in the near future. Two caveats are raised to inform this transition towards universal health coverage.

Suggested Citation

  • Alex Jingwei He & Shaolong Wu, 2017. "Towards Universal Health Coverage via Social Health Insurance in China: Systemic Fragmentation, Reform Imperatives, and Policy Alternatives," Applied Health Economics and Health Policy, Springer, vol. 15(6), pages 707-716, December.
    • Handle: RePEc:spr:aphecp:v:15:y:2017:i:6:d:10.1007_s40258-016-0254-1
    DOI: 10.1007/s40258-016-0254-1
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    References listed on IDEAS

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    Cited by:

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    2. Linglong Ye & Jiecheng Luo & Ben-Chang Shia & Ya Fang, 2019. "Multidimensional Health Groups and Healthcare Utilization Among Elderly Chinese: Based on the 2014 CLHLS Dataset," IJERPH, MDPI, vol. 16(20), pages 1-13, October.
    3. Cui, Kun & Li, Bo & Wang, Hanyang, 2021. "Quantitative analysis of health insurance reform in China: Pure consolidation or universal health insurance?," Economic Modelling, Elsevier, vol. 101(C).
    4. Guangsheng Wan & Zixuan Peng & Yufeng Shi & Peter C. Coyte, 2020. "What Are the Determinants of the Decision to Purchase Private Health Insurance in China?," IJERPH, MDPI, vol. 17(15), pages 1-15, July.
    5. Chunjuan Qiu & Xianyi Wu, 2019. "The Effect of Medical Insurance on Outpatient Visits by the Elderly: An Empirical Study with China Health and Retirement Longitudinal Study Data," Applied Health Economics and Health Policy, Springer, vol. 17(2), pages 175-187, April.
    6. Qiang Yao & Chaojie Liu & Ju Sun, 2020. "Inequality in Health Services for Internal Migrants in China: A National Cross-Sectional Study on the Role of Fund Location of Social Health Insurance," IJERPH, MDPI, vol. 17(17), pages 1-22, August.
    7. Yuyan Gao & Li Li & David C Schwebel & Peishan Ning & Peixia Cheng & Guoqing Hu, 2018. "Reimbursement for injury-induced medical expenses in Chinese social medical insurance schemes: A systematic analysis of legislative documents," PLOS ONE, Public Library of Science, vol. 13(3), pages 1-13, March.
    8. Lin Gong & Juan Chen, 2023. "Disparities in Social Insurance Participation and Urban Identification Among In-situ Urbanized Residents in China," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 18(3), pages 1269-1289, June.
    9. Wahyu P. Nugraheni & Asri Hikmatuz Zahroh & Risky Kusuma Hartono & Ryan Rachmad Nugraha & Chang Bae Chun, 2020. "National Health Insurance Deficit in Indonesia: Identification of Causes and Solutions for Resolution," Global Journal of Health Science, Canadian Center of Science and Education, vol. 12(13), pages 1-58, December.

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