China’s medical insurance reforms aim to improve healthcare security

Officially implemented in 1998, it has played a key role in facilitating the country's transition from a planned economy to a socialist market economy.


Patients receive treatment at the emergency department at Gansu Province Central Hospital in Lanzhou, Gansu province, on Jan 16, 2023. [Photo by Pei Qiang/For]

February 20, 2023

BEIJING – China’s medical insurance reforms that channel part of funds from employees’ individual accounts to public accounts to help expand reimbursement for outpatient costs are aimed at improving the healthcare security of the public and boosting efficient use of medical insurance funds, an expert said on Saturday.

“The change is not prompted by a sudden impulse,” said Wang Chaoqun, a Professor at Central China Normal University’s School of Public Administration in Wuhan, Hubei province.

The central leadership had first proposed in 2020 to reform individual medical insurance accounts and establish a mutual aid mechanism for outpatient expenditures. In April 2021, a guideline issued by the State Council, China’s cabinet, laid out more specific reform measures, according to Wang.

“In fact, the 2010 Law on Social Insurance does not include stipulations on employees’ individual accounts because at that time, officials and experts had already begun considering long-term reforms,” he said. “This means that the country has been deliberating, drafting and preparing for the reforms for a long time.”

China’s medical insurance system for employees was officially implemented in 1998, and has played a key role in facilitating the country’s transition from a planned economy to a socialist market economy.

Over the years, Wang said all reforms made to the system are aimed at improving the healthcare security level of the public and increasing efficiency of China’s medical insurance funds.

“Each country should devise medical insurance plans based on their own national condition, including history, population and gaps between different regions,” he said. “For China, the challenge lies in satisfying the demands of a massive population living in vast regions with uneven development.”

Regarding the resilience of China’s medical funds, Wang said that a fitting example is its response to the COVID-19 epidemic.

“The COVID-19 nucleic acid tests, treatment and vaccines are all free for the public. Such costs have been reimbursed by financial authorities and healthcare funds together, and there is no doubt that the country’s healthcare security and financial systems have been essential in helping us prevailing over the virus,” he said.

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