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Chinese Social Policy in a Time of Transition$
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Douglas Besharov and Karen Baehler

Print publication date: 2013

Print ISBN-13: 9780199990313

Published to Oxford Scholarship Online: January 2014

DOI: 10.1093/acprof:oso/9780199990313.001.0001

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Health and Rural Cooperative Medical Insurance

Health and Rural Cooperative Medical Insurance

(p.101) 6 Health and Rural Cooperative Medical Insurance
Chinese Social Policy in a Time of Transition

Song Gao

Xiangyi Meng

Oxford University Press

China’s rural communes collapsed with the reform of the household responsibility system starting in 1978, followed by the collapse of the old rural cooperative medical system, the direct consequence of which was a continuous decline in health insurance coverage in rural China over the subsequent two decades. With the privatization of the health care system, the costs of medical care escalated. A new wave of rural cooperative medical insurance was first promoted in selected areas in 2003 and has since spread to the whole nation. Using a unique longitudinal data set covering the period of 1991–2006, this chapter evaluates the impact of rural cooperative health schemes on individual subjective health, including both the old and new schemes. The results show that, prior to the 2003 new insurance scheme, individual participation in rural cooperative insurance had a significantly positive impact on self-reported health, while there is no evidence of significant impacts of the new scheme. This differential impact is probably due to the existence of individual adverse selection under the new scheme, biasing the coefficient downward to zero.

Keywords:   Rural cooperative medical insurance, health, participation

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