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Effects of Public Hospital Reform on Inpatient Expenditures in Rural China

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  • Yuting Zhang
  • Qianheng Ma
  • Yingchun Chen
  • Hongxia Gao

Abstract

Public hospital reform is one priority area in the healthcare system reform that China launched in 2009. The Chinese government invested over $10bn for pilot projects in public hospital reform in rural China. However, little evidence exists on their effects. Using a quasi‐natural experiment design, we evaluated the effects of a public hospital pilot project in Hubei province on inpatient spending. We obtained inpatient claims data from 1/1/2011 through 6/30/2013 for enrollees in the New Cooperative Medical Scheme in two counties: Danjiangkou, one of the pilot counties selected for reform in September 2012, and Laohekou, a similar, adjacent county serving as the control group. Using a difference‐in‐differences approach with propensity score weighting, we found that total inpatient spending increased ¥1160 (95% CI 1155–1166), out‐of‐pocket spending increased ¥385 (95% CI 382–389), length of stay increased 0.51 days (95% CI 0.50–0.52), but inpatient medication spending decreased ¥147 (95% CI 145–150), post‐policy in Danjiangkou, relative to the control group. The overall reimbursement rate increased by 5.7 percentage points. One of the goals of the recent public hospital reform is to make inpatient services affordable to patients. We found that although patients spent less on inpatient medications, total out‐of‐pocket spending increased considerably after reform. Copyright © 2016 John Wiley & Sons, Ltd.

Suggested Citation

  • Yuting Zhang & Qianheng Ma & Yingchun Chen & Hongxia Gao, 2017. "Effects of Public Hospital Reform on Inpatient Expenditures in Rural China," Health Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 421-430, April.
  • Handle: RePEc:wly:hlthec:v:26:y:2017:i:4:p:421-430
    DOI: 10.1002/hec.3320
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    References listed on IDEAS

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    Cited by:

    1. Chan, Marc K. & Zeng, Guohua, 2018. "Unintended consequences of supply-side cost control? Evidence from China's new cooperative medical scheme," Journal of Health Economics, Elsevier, vol. 61(C), pages 27-46.
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    4. Ruibo He & Ting Ye & Jing Wang & Yan Zhang & Zhong Li & Yadong Niu & Liang Zhang, 2018. "Medical Service Quality, Efficiency and Cost Control Effectiveness of Upgraded Case Payment in Rural China: A Retrospective Study," IJERPH, MDPI, vol. 15(12), pages 1-13, December.
    5. Fu, Hongqiao & Li, Ling & Yip, Winnie, 2018. "Intended and unintended impacts of price changes for drugs and medical services: Evidence from China," Social Science & Medicine, Elsevier, vol. 211(C), pages 114-122.
    6. Li, Xue & Smyth, Russell & Yao, Yao, 2023. "Extreme temperatures and out-of-pocket medical expenditure: Evidence from China," China Economic Review, Elsevier, vol. 77(C).
    7. Yuqing Tang & Chaojie Liu & Junjie Liu & Xinping Zhang & Keyuan Zuo, 2018. "Effects of County Public Hospital Reform on Procurement Costs and Volume of Antibiotics: A Quasi-Natural Experiment in Hubei Province, China," PharmacoEconomics, Springer, vol. 36(8), pages 995-1004, August.
    8. See, Kok Fong & Ng, Ying Chu, 2021. "Do hospital reform and ownership matter to Shenzhen hospitals in China? A productivity analysis," Economic Analysis and Policy, Elsevier, vol. 72(C), pages 145-155.
    9. Guanfu Fang & Hui Cao, 2020. "State versus private provision: How does China’s market‐oriented reform affect healthcare delivery?," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 28(3), pages 381-411, July.

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