Urban health care reform initiative in China: findings from its pilot experiment in Zhengjiang city

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Journal Article

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This research presents a preliminary assessment of China's urban health care reform experiment. In reforming its existing urban health care programs, the Chinese government initiated a new community-based insurance plan, which was implemented in a pilot experiment in 1994. Data for this study was derived from the first post-experiment survey, which was conducted in Zhengjiang city in 1995. Urban Health Care Reform 505 The survey contains a total of 14,745 individuals, a 3.2% stratified random sample of the total enrollees in Zhengjiang city. A two-part econometric model was employed as the study's analytical framework. Major findings show significant changes in health care cost and utilization patterns in response to the experimental health insurance plan instituted in Zhengjiang city. First, the incidence of using any health care services increased by 12% among the general population. Second, when looking into changes in the composition of difference services, there was a shift from the likelihood of using inpatient care to outpatient care. Third, total health care expenditures decreased by 8% among the general population and 18% among users. And fourth, among respective service-specific users, the utilization rates consistently decreased by 14% for outpatient visits, 11% for inpatient admissions, and 17% for length of stay (LOS) per admission. Based on these findings, the experimental plan appears to be more cost effective than the previous health care programs.

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International Journal of Economic Development

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