China's health insurance reform to boost assistance, efficiency

The ongoing health insurance reform in China will improve outpatient services for patients, experts said.

According to the reform, outpatient expenses are covered through collective pools of funds, while corresponding adjustments are made to the makeup of individual saving accounts.

The reform will see contributions from employers fed into unified accounts, instead of personal accounts, to support the reimbursement of general outpatient bills. Retirees' deposit amounts are pegged to local per capita pensions, instead of individual pensions.

The reduction in deposits to personal accounts doesn't mean any curtailment of the benefits for the insured people, said experts, as the money flows into the pooled fund and is mostly earmarked for outpatient services. After the reform, more general outpatient bills will be reimbursed.

Emphasis on mutual aid

The reform makes sense because medical insurance is a kind of social insurance, which means that it has the nature of mutual assistance, shared responsibility, and joint construction and sharing, said experts.

In the past, general outpatient expenses were mainly covered by individual accounts, but a significant portion of such accounts doesn't have sufficient savings, causing a huge burden for patients, said Jin Weigang, deputy head of the China Association of Social Security.

While some people might have seen the deposits in their personal accounts running low due to frequent visits to the doctor, other accounts showed significant deposits remaining unused.

To alleviate the burden of outpatient bills on individual accounts, China has brought outpatient expenses for serious diseases and major chronic diseases under the coverage of unified accounts, which were initially used to reimburse hospitalization bills and bills for serious diseases.

The pooled fund is still unable to cover the expenses of general outpatient services, which constitute the lion's share in people's outpatient service needs, said Jin, who is also vice dean of the Institute of State System Research, Zhejiang University.

The new reform will enable the health insurance system to cover outpatient expenses more effectively, without inflicting any further financial burden on employers and employees, said Gu Xuefei, a medical care policy researcher at the China National Health Development Research Center.

Benefits for elderly people

The reform raises the minimum reimbursement percentage for outpatient medical bills to 50 percent, as well as mandating efforts to further tip the scales of policy in favor of retired people.

The city of Hohhot, north China's Inner Mongolia Autonomous Region, provides a good example. It added 5 percent to the standard reimbursement ratio of outpatient bills for retired people and further raised the upper limit for the collective fund to cover the outpatient bills for this group of people.

As a result, the retired people in the city can have up to 6,000 yuan (US$870) of their outpatient bills reimbursed, which is 2,000 yuan more than the limit they enjoyed in the past, and higher than the benefits that the local working population enjoys.

Moreover, according to the existing policy, people are allowed to help cover the medical expenses of their spouses, parents and children from their personal accounts. This means that elderly people can get more financial help from their families when coping with medical risks.

Financially viable

The basic medical insurance system for urban employees remains financially healthy.

In the first 11 months of 2022, the fund recorded some 1.81 trillion yuan in revenue and nearly 1.33 trillion yuan in expenditure, according to data released by the National Health care Security Administration.

Data also shows that the unified accounts took in more than 1.186 trillion yuan while paying out 932.1 billion yuan in 2021.

The new health insurance reform is expected to be completed in three years, while support measures have already been rolled out in some regions to facilitate the reform.

In central China's Wuhan, 4,065 pharmacies have been newly added to the system, supporting efforts to cover outpatient expenses through unified accounts, in addition to the more than 1,000 pharmacies previously brought in under a pilot scheme.