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Sleeping money: investigating the huge surpluses of social health insurance in China

  • JunQiang Liu


  • Tao Chen
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    The spreading of social health insurance (SHI) worldwide poses challenges for fledging public administrators. Inefficiency, misuse and even corruption threaten the stewardship of those newly established health funds. This article examines a tricky situation faced by China’s largest SHI program: the basic health insurance (BHI) scheme for urban employees. BHI accumulated a 406 billion yuan surplus by 2009, although the reimbursement level was still low. Using a provincial level panel database, we find that the huge BHI surpluses are related to the (temporarily) decreasing dependency ratio, the steady growth of average wages, the extension of BHI coverage, and progress in social insurance agency building. The financial situations of local governments and risk pooling level also matter. Besides, medical savings accounts result in about one third of BHI surpluses. Although these findings are not causal, lessons drawn from this study can help to improve the governance and performance of SHI programs in developing countries. Copyright Springer Science+Business Media New York 2013

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    Article provided by Springer in its journal International Journal of Health Care Finance and Economics.

    Volume (Year): 13 (2013)
    Issue (Month): 3 (December)
    Pages: 319-331

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    Handle: RePEc:kap:ijhcfe:v:13:y:2013:i:3:p:319-331
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    1. Liu, Yuanli & Rao, Keqin & Fei, John, 1998. "Economic transition and health transition: comparing China and Russia," Health Policy, Elsevier, vol. 44(2), pages 103-122, May.
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    5. Win Lin Chou & Zijun Wang, 2009. "Regional inequality in China's health care expenditures," Health Economics, John Wiley & Sons, Ltd., vol. 18(S2), pages S137-S146, July.
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