Has equity in government subsidy on healthcare improved in China? Evidence from the China’s National Health Services Survey

Lei Si, Mingsheng Chen, Andrew J. Palmer

Monitoring the equity of government healthcare subsidies (GHS) is critical for evaluating the performance of health policy decisions. China's low-income population encounters barriers in accessing benefits from GHS. This paper focuses on the distribution of China's healthcare subsidies among different socio-economic populations and the factors that affect their equitable distribution. It examines the characteristics of equitable access to benefits in a province of northeastern China, comparing the equity performance between urban and rural areas. Benefit incidence analysis was applied to GHS data from two rounds of China's National Health Services Survey (2003 and 2008, N = 27,239) in Heilongjiang province, reflecting the information in 2002 and 2007 respectively. Concentration index (CI) was used to evaluate the absolute equity of GHSs in outpatient and inpatient healthcare services. A negative CI indicates disproportionate concentration of GHSs among the poor, while a positive CI indicates the GHS is pro-rich, a CI of zero indicates perfect equity. In addition, Kakwani index (KI) was used to evaluate the progressivity of GHSs. A positive KI denotes the GHS is regressive, while a negative value denotes the GHS is progressive. CIs for inpatient care in urban and rural residents were 0.2036 and 0.4497 respectively in 2002, and those in 2007 were 0.4433 and 0.5375. Likewise, CIs for outpatient care are positive in both regions in 2002 and 2007, indicating that both inpatient and outpatient GHSs were pro-rich in both survey periods irrespective of region. In addition, KIs for inpatient services were -0.3769 (urban) and 0.0576 (rural) in 2002 and those in 2007 were 0.0280 and 0.1868. KIs for outpatient service were -0.4278 (urban) and -0.1257 (rural) in 2002, those in 2007 were -0.2572 and -0.1501, indicating that equity was improved in GHS in outpatient care in both regions but not in inpatient services. The benefit distribution of government healthcare subsidies has been strongly influenced by China's health insurance schemes. Their compensation policies and benefit packages need reform to improve the benefit equity between outpatient and inpatient care both in urban and rural areas.