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Health financing systems and health-care access

Date: Poster sessions
Source: Forum 11
Authors: Dong Hengjin, Group Leader, Tropical Hygiene and Public Health, International Health Economics and Technology Assessment, Heidelberg University, Germany
with Vinod Diwan and Lennart Bogg


It has been argued that a good health financing system should strive for universal access, high quality, socially acceptable costs and a free choice of physician. Traditionally there are three formal health-insurance schemes and one informal component in China: the government health insurance (GHI), the labor health insurance (LHI), the rural co-operative health insurance (CHI), and `out-of-pocket' payment. Recently in some urban areas, GHI and LHI have been combined into a system called `social insurance'.

The research focus of this study is the differences in health-care access among the different health financing systems in rural China.

A multistage sampling procedure was used to select county, township and village health facilities. Six counties in three provinces (Jiangsu, Anhui and Jiangxi) in central and eastern China were chosen based on their gross national product levels and infant mortality rates. In each of the selected counties, one town and four townships were chosen. Five villages in each township were randomly selected. 2552 outpatients were interviewed in the six counties in August and October, 1995 and 1064 health-care providers were interviewed.

The empirical data from the six Chinese counties in this study suggest that health- care financing methods differ with regard to the degree of access. A health insurance system can improve access: as indicated in this study, insured people have a higher access to health care and to expensive care, such as high-cost drugs or inpatient care. However, health insurance may lead to a risk of over-use of health resources, by both consumers and providers. It was found that consumption of drugs per capita, for example, is higher among insured patients.

China has low coverage of health insurance, thus resulting in low access to health care. In order to improve people's health, different types of insurance schemes, with certain measures to control `moral hazards' such as co-payment, can improve health- care access and efficiency.