THE URBAN RESIDENT BASIC MEDICAL INSURANCE: A LANDMARK REFORM TOWARDS UNIVERSAL COVERAGE IN CHINA

As the latest government effort to reform China's health care system, Urban Resident Basic Medical Insurance (URBMI) was piloted in seventy-nine cities during the summer of 2007, following State Council Policy Document 2007 No. 20's guidelines. This study presents the first economic analysis of URBMI, following a national household survey in nine representative Chinese cities. The survey aimed to answer three questions: Who is covered by the plan? Who gains from the plan? Who is most satisfied with the plan? We have found that there is a U-shaped relationship between URBMI participation rate and income. That is, the extremely rich or poor are the most likely to participate. Those with any inpatient treatment last year or with any chronic disease are also more likely to enroll in URBMI, indicating adverse selection into participation. We have also found that in reducing financial barriers to care, URBMI most significantly benefits the poor and those with previous inpatient care. Finally, those participants ill the bottom 20% of family incomes are happier with URBMI than are their more affluent counterparts. Copyright (C) 2009 John Wiley & Sons, Ltd.