Impact of China's Urban Employee Basic Medical Insurance on Health Care Expenditure and Health Outcomes

37 Pages Posted: 27 Jan 2015

See all articles by Feng Huang

Feng Huang

Shanghai University of Finance and Economics

Li Gan

Texas A&M University - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: January 2015

Abstract

At the end of 1998, China launched a government-run mandatory insurance program, the Urban Employee Basic Medical Insurance (UEBMI), to replace the previous medical insurance system. Using the UEBMI reform in China as a natural experiment, this study identify variations in patient cost sharing that were imposed by the UEBMI reform and examine their effects on the demand for health-care services. Using data from the 1991-2006 waves of the China Health and Nutrition Survey, we find that the increased cost sharing is associated with decreased outpatient medical care utilization and expenditures but not with decreased inpatient care utilization and expenditures. Patients from low- and middle-income households, or in less-serious medical situations are found to be more sensitive to prices. We observe little impact on patient health, as measured by self-reported poor health status.

Suggested Citation

Huang, Feng and Gan, Li, Impact of China's Urban Employee Basic Medical Insurance on Health Care Expenditure and Health Outcomes (January 2015). NBER Working Paper No. w20873. Available at SSRN: https://ssrn.com/abstract=2555393

Feng Huang (Contact Author)

Shanghai University of Finance and Economics ( email )

Li Gan

Texas A&M University - Department of Economics ( email )

5201 University Blvd.
College Station, TX 77843-4228
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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