China Plans Universal Health Care

October 21st, 2008 | Sources: Lancet, NEJM, Wall Street Journal

Subjects: ,

In a stunning policy turnabout made possible by its swollen coffers, China announced that it will cover health care costs for 90% of its population by 2010 and implement universal coverage by 2020.

The plan has global implications given China’s enormous population, its questionable capacity to address epidemics of communicable diseases such as avian influenza and SARS, and its troubled pharmaceutical and food processing industries.

For 35 years after Mao Zedong assumed control of China, the government employed physicians and owned, funded and operated China’s health care system. During this time, China achieved dramatic improvements (albeit from a very low baseline) in life expectancy, infant mortality and other measures of population health.

Then in the early 1980s, in what appears to have been collateral damage from a larger effort to privatize its economy, China essentially dismantled its health care system overnight, replacing it with nothing. Central government spending on health evaporated, leaving overwhelmed provincial and local authorities to coordinate care, physicians to fend for themselves and normal citizens with no choice but to pay for health services out of pocket.

The new system worked, though barely in wealthy urban areas but rural health systems degraded rapidly and rural-urban health disparities increased. The World Health Organization estimated in fact that by the end of the last decade, payment out-of-pocket accounted for more than 60% of all spending on health services in China.

The WHO helped design China’s new plan, along with the World Bank, McKinsey & Co. and Chinese public health experts. Few details have emerged regarding the plan, a maddening point for academics and ordinary citizens. Apparently, revenues generated by hospitals will be directed to the state, and the government plans to set prices for medical services, but funding and implementation plans have not been released.  We watch with interest, knowing in our heart of hearts that legitimate superpowers take steps to assure all their citizens have access to health care.


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