Income related inequalities in New Cooperative Medical Scheme: a five-year empirical study of Junan County in China

International Journal for Equity in Health Income related inequalities in New Cooperative Medical Scheme: a five-year empirical study of Junan County in China Shasha Yuan 2 3 Clas Rehnberg 1 Xiaojie Sun 3 Xiaoyun Liu 0 Qingyue Meng 0 0 Peking University China Center for Health Development Studies , Beijing 100191 , China 1 Medical Management Center, Karolinska Institutet , SE-17177 Stockholm , Sweden 2 Center for Health Policy and Management, Institute of Medical Information & Library, Chinese Academy of Medical Sciences & Peking Union Medical College , Beijing 100020 , China 3 Center for Health Management and Policy, Shandong University , Jinan 250012 , China Introduction: The Chinese New Cooperative Medical Scheme (NCMS) was launched in 2003 aiming at protecting the poor in rural areas from high health expenditures and improving access to health services. The income related inequality of the reform is a debating and concerning policy issue in China. The purpose of this study is to analyze the degree and changes of income related inequalities in both inpatient and outpatient services among NCMS enrollees from 2007 to 2011. Data and methods: Data was extracted from the NCMS information system of Junan County in Shandong province from 2007 to 2011. The study targeted all NCMS enrollees in the county, 726850 registered in 2011. Detailed information included demographic data, inpatient and outpatient data in each year. Descriptive analysis of quintiles and standardized concentration index (CI*) were employed to examine the income related inequalities in both inpatient and outpatient care. Results: For inpatient care, the benefit rate CI* was positive (pro-rich) and increased from 2007 to 2011 while for outpatient care was negative (pro-poor) and a decreasing pattern was observed. For outpatient visits and expenses, the CI* changed from a positive sign in 2007 to a negative sign in 2011 with some fluctuations. The pro-rich inequality exacerbated for admissions while alleviated for length of stay and total inpatient expenses during the study period. The pro-rich inequality for inpatient reimbursement aggravated from 2007 to 2010 and alleviated from 2010 to 2011. For outpatient reimbursement, it altered from a positive sign in 2007 to a small negative sign in 2011. Finally, the richer needed to afford more self-payments for inpatient services and the CI* decreased from 2009 to 2011 while the inequality for outpatient self-payments changed from pro-rich in 2007 to pro-poor in 2011. Conclusions: In the NCMS, the pro-rich inequality dominated for the inpatient care while a pro-poor advantage was shown for outpatient care from 2007 to 2011 in Junan. The extent of pro-rich inequality in length of stay, inpatient expenses and inpatient reimbursement increased from 2007 to 2009, but recently between 2010 and 2011 showed a change favoring the poor. New Cooperative Medical Scheme; Income related inequality; Concentration index; Inpatient; Outpatient; Medical service utilization; Reimbursement; Out of pocket expenditures; China - Introduction Since the collapse of the old Cooperative Medical Scheme in China after the economic reforms of the early 1980s, rural residents have been excluded from the public social security system [1]. Financial barriers, among other factors, have become the most important contributor to impede the poor in trying to access medical services [1]. In order to address this problem, the Chinese government initiated New Cooperative Medical Scheme (NCMS) in 2003 to reduce the financial burden of rural residents and to achieve universal coverage. The NCMS is organized, guided and supported by the central government but has voluntary involvement [2,3]. Unlike its predecessor (the old Cooperative Medical Scheme), it operates at county rather than village level and variations existed in design and implementation across counties [3]. The central government takes the overall responsibility to manage and supervise the scheme while the policy implementation responsibilities are decentralized to county level governments [2]. Specifically, the central and provincial governments designed the essential or basic rules about implementation of NCMS, such as the minimum level of NCMS premium and policy reimbursement rate, the priority for the reimbursement of essential drugs or Chinese traditional medicine, etc., while the county governments are responsible for specific operations, such as defining benefit packages, designating participating providers, pooling risk across the local rural population and experimenting health policy innovations like payment reform. Under this context, the benefit package was usually the same for the participants in one county or province while it may differentiate across counties or provinces, which was closely related to the varied financing levels of NCMS in different areas. The NCMS is heavily subsidized by central, provincial and county governments and also partly financed privately from individual farmers [3]. Coverage of inpatient care is a reimbursement priority in the NCMS but also a relatively slight compensation for outpatient care, which depends on specific benefit packages in different counties. By now the scheme is also extended to cover other catastrophic diseases, such as chronic diseases, leukemia, cancer, etc. By 2011, 97.5% (around 832 million) of the rural population have been covered by the NCMS in China, meanwhile, the total NCMS revenues per capita increased from 30 RMB in 2003 to 250 RMB in 2011 (equivalent to 194 RMB in 2003 years price [4]), as the subsidies from governments in central, provincial and county levels rose from 20 RMB per enrollee in 2003 to 200 RMB in 2011 (equivalent to 155 RMB in 2003 years price [4]) (Ministry of Health, China). The rapid expansion of the NCMS inevitably raises challenging issues like any other health insurance systems as escalating healthcare costs, health care quality and the equity issue. The socioeconomic equality in healthcare is one of the most important issues of concern in both developed and developing countries. For a specific health insurance system, it means that all enrollees should have equal access to utilize medical services, get equal reimbursement benefits and finally afford equally proportional self-payment, irrespective of their socioeconomic status, especially not dependent on the financial status [5,6]. In reality, the poor, who frequently are in need of more services, are often the least able to pay, while the wealthy utilize disproportionately more services although they have less need [7,8]. Moreover, it is also a disadvantageous factor for the poor enrollees that all individual farmers, regardless of their economic status, would pay the same contribution to be enrolled. Considering its rapid expansion and flat-rate personal contribution, it is necessary and meaningful to analyze and discuss the income related inequality situation of the utilization of (...truncated)