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Competent Alternative Model for the Peasants' Medical Expenditures in China: A Case of New Rural Cooperative Medical Service System (Nrcms) in Zhejiang Province

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  • Lu Wencong
  • Cheng Ying
  • Mohummed Shofi Ullah Mazumder

Abstract

The New Rural Cooperative Medical Service System (NRCMS) in China has been established to ensure improved medical care support for all categories of Chinese peasants to offset their burden of excessive medical care expenditures. The primary aim of this paper is to identify an appropriate alternative modelling approach for the patients' medical expenditures. Data were collected from Jiaojiang city through cluster and multistage random sampling procedure, which was comprised of 4,630 enrolled rural people under NRCMS. The paper presented the first comparison of common econometric medical expenditures modelling approaches. Major findings reveal that the Generalized Linear Model (GLM) predictive accuracy appears to be better than the Finite Mixture Model (FMM) and GLM (log link) was the best performer among all approaches. It may be attributed due to the structural difference of medical expenditures between China and other developing countries compared to the developed countries. This suggests that the Chinese government may find an alternative to choose GLM approach among others to minimize the peasants' medical expenditures under NRCMS.

Suggested Citation

  • Lu Wencong & Cheng Ying & Mohummed Shofi Ullah Mazumder, 2014. "Competent Alternative Model for the Peasants' Medical Expenditures in China: A Case of New Rural Cooperative Medical Service System (Nrcms) in Zhejiang Province," Prague Economic Papers, Prague University of Economics and Business, vol. 2014(2), pages 233-249.
    • Handle: RePEc:prg:jnlpep:v:2014:y:2014:i:2:id:482:p:233-249
    DOI: 10.18267/j.pep.482
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    Keywords

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    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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