China Healthcare Reforms: An Overview of Recent Developments

In 2008, the Chinese government unveiled the Healthy China 2020 reforms, which were designed as long-term plans to establish a universal health care insurance system. The aims were to design a science and technology-based system with inclusive health insurance programs and also improving health care infrastructure to provide affordable care for everyone in the country. Trying to balance the expansion of coverage, the management of costs and the building out of the necessary health care infrastructure is an immense challenge; however it is one that is being met pragmatically through testing of possible solutions.

There were limited concrete plans when the initiative first started, however there were small-scale experiments in some localities around the country. Restrictions on foreign companies participating in joint ventures to manage hospitals were somewhat relaxed, while one municipal government in Anhui province was permitted to experiment with splitting hospitals from pharmacies in order to control costs and prevent corruption between pharmaceutical salespeople and hospital staff. This was purported to allow the local pharmaceuticals authority to control bidding over drugs, especially those considered essential, and keep the costs low.

A development that soon followed was the creation of the Essential Drug List (EDL) in 2009, which was a list of 307 pharmaceuticals that were supposed to be adequately stocked around China in appropriate dosages at prices that the average Chinese Citizen could afford. The Essential Drug List was modified in February, 2012 to expand the list of pharmaceuticals contained in the list to 800 drugs.

While the government has made efforts to cut costs and increase the level of subsidization for patient's care, they have also made many alterations to the social insurance landscape of the country in order to better develop the system through which health care is paid for. In 2011, China's State Council increased the level of reimbursements for people on both the urban and rural health insurance scheme. At the same time there was also much deliberation on how expatriates working in China fit into the comprehensive social insurance system that was being constructed.

The scheme that was eventually decided upon was to tax expatriates and the companies which employed them while allowing them access to the social security apparatus including retirement benefits, unemployment insurance, maternity coverage, workplace injury as well as subsidized fees at public hospitals. However the scheme exempts expatriate workers from countries which held bilateral agreements on social insurance with China, such as South Korea and Germany.

This article covers a few of the more prominent reforms and initiatives that have helped China start down the path towards creating a robust health care system, however there are numerous other test initiatives or probationary reforms that have not been covered here. As China continues to develop, there will also be ongoing adjustments and new initiatives to tackle problems inherent in trying to provide quality health care at affordable costs to so many people, across such a large geographical area.