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Forecasting health financing sustainability under the unified pool reform: evidence from China’s Urban Employee Basic Medical Insurance

Author

Listed:
  • Jing Wu

    (Yanshan University)

  • Hualei Yang

    (Zhongnan University of Economics and Law)

  • Xiaoqing Pan

    (Zhengzhou University of Light Industry)

Abstract

Objective The integration of the health insurance fund pool may threaten the sustainability of the fund by increasing its expenditures through the exacerbation of the moral hazard of participations. The purpose of this paper is to assess and predict the impact of the single pool reform of China’s Urban Employee Basic Medical Insurance (UEBMI) on the expenditure and sustainability of the health insurance fund. Methods In this paper, we consider the pilot implementation of the single pool reform in some provinces of China as a quasi-natural experiment, and develop a staggered DID model to assess the impact of the single pool reform on medical reimbursement expenditure. Based on the results, an actuarial model is developed to predict the impact on the accumulated balance of China’s health insurance fund if the single pool reform is continued. Results We found that the medical reimbursement expenditure would increase by 66.4% per insured person after the unified provincial-level pool reform. There is individual heterogeneity in the effects of the unified single pool reform on medical reimbursement expenditure, and the reimbursement expenditure of retired elderly has the largest increase. If the unified single pool reform is gradually promoted, the current and accumulated balance of the UEBMI pooling fund would have gaps in 2031 and 2042, respectively. Conclusion We verified that a larger fund pool will bring unreasonable growth of fund expenditures, which will threaten the sustainable development of health insurance. To minimize the impact of the unified single pool reform on the sustainability of the health insurance fund, we suggest strengthening the monitoring of moral hazard behavior, promoting the delayed retirement system, and encouraging childbearing.

Suggested Citation

  • Jing Wu & Hualei Yang & Xiaoqing Pan, 2024. "Forecasting health financing sustainability under the unified pool reform: evidence from China’s Urban Employee Basic Medical Insurance," Health Economics Review, Springer, vol. 14(1), pages 1-13, December.
  • Handle: RePEc:spr:hecrev:v:14:y:2024:i:1:d:10.1186_s13561-024-00554-y
    DOI: 10.1186/s13561-024-00554-y
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    References listed on IDEAS

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    More about this item

    Keywords

    Unified single pool; Health insurance funds; Healthcare purchasing; Fund sustainability; Staggered DID; Actuarial model;
    All these keywords.

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling

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