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Health system reform in China: What role for private insurance?


  • Blomqvist, Åke


The purpose of the present paper is to show that much of the literature on health economics and on the international experience with different forms of health system organization can be interpreted as supporting the idea that reliance on an unregulated market mechanism for organizing the production and financing of health services is likely to result in major problems both with respect to efficiency and equity. However, reliance on a centralized "command-and-control" model managed by government has also been shown to entail problems in practice. For this reason I argue that the best option at China's current state of development may be a compromise model in which competing private providers are given an important role, both for the production of health services and in the provision of health insurance, but in which the government intervenes (through regulation and direct provision) in such a way as to attain both a high degree of equity of access to health care, and to avoid the most significant forms of "market failure" that would arise in an unregulated private system.

Suggested Citation

  • Blomqvist, Åke, 2009. "Health system reform in China: What role for private insurance?," China Economic Review, Elsevier, vol. 20(4), pages 605-612, December.
  • Handle: RePEc:eee:chieco:v:20:y:2009:i:4:p:605-612

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    References listed on IDEAS

    1. Blomqvist, Ake & Horn, Henrik, 1984. "Public health insurance and optimal income taxation," Journal of Public Economics, Elsevier, vol. 24(3), pages 353-371, August.
    2. repec:wsi:serxxx:v:53:y:2008:i:01:n:s0217590808002811 is not listed on IDEAS
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    Cited by:

    1. Liu, Hong & Gao, Song & Rizzo, John A., 2011. "The expansion of public health insurance and the demand for private health insurance in rural China," China Economic Review, Elsevier, vol. 22(1), pages 28-41, March.
    2. Hu, Hsin-Hui & Qi, Qinghui & Yang, Chih-Hai, 2012. "Analysis of hospital technical efficiency in China: Effect of health insurance reform," China Economic Review, Elsevier, vol. 23(4), pages 865-877.

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