Reform of China's public healthcare system, under way for years,
will accelerate to full speed in line with the latest government
work report delivered to the National People's Congress earlier
this month.
As early as 1997, a public healthcare insurance plan was
launched in cities, covering only those who are formally employed.
A recent government initiative will set up an extensive healthcare
insurance plan covering all rural and urban residents.
Three measures were outlined to finish the mission. First, the
current public healthcare insurance plan will be extended to all
urban residents. Second, a "new cooperative medical plan", namely a
voluntary public healthcare insurance plan, will be consolidated
and expanded in rural areas. Third, universal access to primary
healthcare will be guaranteed in the near future.
A major question remains before these three measures are taken:
Should primary healthcare be a natural result of the first two
measures or a new, separate system developed independently?
Different answers to this question mean totally different policy
choices and the wrong decision will probably threaten the whole
reform package.
Currently public health insurance in cities only benefits
employees with regular jobs while children, unemployed,
self-employed and migrant workers are not covered. Although the
authorities decided to include self-employed and migrant workers
over the past years, it seems that this measure has not worked
well.
By the end of 2006, public health insurance covered about 160
million out of the country's 500 million urban residents. The first
measure mentioned, extending coverage to all urban residents, aims
at extending this insurance plan to cover all urban residents
within five years.
The new cooperative medical plan in rural areas is publicly
subsidized health insurance for those willing to pay an annul fee
of about 10 yuan ($1.28) or more in better-off areas.
Started in 2003, it covered about half the rural residents by
the end of 2006. The enrollees can have up to 60 percent of their
healthcare costs reimbursed, but they are required to first pay the
costs themselves before being reimbursed.
Many farmers are reluctant to enroll because their co-payment is
still considered high and the procedure of reimbursement is
cumbersome.
These problems must be resolved to enhance the attractiveness of
the cooperative medical care system for farmers.
Clearly, current healthcare insurance systems in both rural and
urban areas are problematic. They are questioned by the public and
healthcare providers as well as decision-makers.
However, these flaws mostly resulted from immature institutional
design. If fixed, the plans would improve remarkably. After all,
there are rich international experiences to refer to, and an
exchange of practices among different local authorities across
China would be mutually beneficial.
In other words, universal coverage for primary healthcare could
be realized by gradual and incremental reforms to the current
healthcare system.
Yet, it seems that a different approach to establishing
universal healthcare is gaining wide support among academics,
officials and the public.
According to advocates of this approach, the government should
set up a separate system to provide primary healthcare services in
cities and villages. Basically, this involves establishing a mini
national health service (NHS). Comprised of community health
centers and clinics, this mini-NHS would offer low-priced or even
free services to citizens with minor diseases and transfer patients
with more serious problems to big hospitals.
If such a system is established, the government will be burdened
with heavy operating costs. A public agency would have to be
established to allocate public money among community health centers
and clinics. Worse, this public agency would have to exist at all
levels of government to keep an effective watch over all community
healthcare providers around the country.
Such an institutional design featuring the planned economy would
be awkward in our country. Run by the State, the community
healthcare providers would have to look to the government for
resources they need according to standards set by the government.
But the government would find it difficult to objectively assess
the large number of subordinate agencies.
Many supporters of free healthcare services by public
institutions believe that China could at least afford a free
healthcare system for treating minor diseases.
But even a mini-NHS may not be feasible in China. Such a system
would only lead the medical care system into the dead end of low
efficiency and meager service.
The brighter path toward universal healthcare coverage should be
careful incremental adjustments to current public health insurance
programs.
The author is a professor at the Institute of Social
Development and Public Policy, Beijing Normal University
(China Daily March 26, 2007)