New Medicare System Enacted to Benefit More People

Zhang Larong, a worker in the Jiujiang Household Appliances Factory in central China's Jiangxi Province, cannot afford the nearly 2,000 yuan for his hospitalization because the business he works for is in trouble.

Fortunately Zhang needed to pay only 200 yuan as the remaining 1,700 yuan was covered by the Jiujiang city workers' medicare fund.

The factory where Zhang works is a state-owned enterprise in economic difficulties, and factory management finds it hard to provide medicare fees for its workers. Since Jiujiang has begun basic medicare system reforms for urban workers, Zhang and many other workers have found it easier to get help for their hospital fees.

In fact, not only Jiujiang, but also many other large and medium-sized Chinese cities are trying the socialized medicare system.

Early in 1998, the newly-elected Chinese Premier Zhu Rongji, announced that the government would help push forward five reform items including the establishment of an urban medicare system for workers.

As early as 1994, Jiujiang and another city were listed as China's first two trial cities to implement the socialized medicare system reforms.

China's former medicare system included workers' insurance and the medicare system for state-owned enterprises, and all the workers' medical fees were covered by the units or businesses which employed them.

Wu Jinping, an official with Jiujiang government and in charge of the medicare reforms says that the former medicare system put great burdens on the national finances as well as on the state-owned enterprises.

"The former medicare system guaranteed the medical welfare of employees over a very long period of time, but medical fees have increased rapidly," noted Wu, adding that in Jiujiang City, the annual growth rate of medical fees increased more rapidly than the fiscal revenue of the city over the same period.

The newly implemented medicare system stresses that employees of state-owned enterprises, private businesses, joint-ventures and collective enterprises can all enjoy the same basic medicare.

The new system requires cities at or above county level to establish medicare funds for their workers, and this has removed the burden from enterprises unable to afford medicare fees.

To date the new socialized medicare system is operating in 303 Chinese cities at or above county-level, covering 48.74 million people.

The Chinese government is determined to increase this to 80 million people by the end of this year.

  • Old Medicare System Ends

    Since April 1, 2001, China's public-funded medical care system for urban employees, has gradually been eased out in Beijing. After 50 years of service, it is giving way to a new medical insurance scheme.

    Millions of Beijing residents who enjoyed almost free medical treatment, will now have to cover part of their medical expenses themselves.

    This is the reason people were rushing to see physicians in major hospitals in Beijing before April, and why the number of patients suddenly shrank when April arrived.

    Similar situations also occurred in many other big cities, such as Kunming and Changchun, which have also been preparing to initiate the medical reform. In waves of panic people impulsively bought medicine and got general check-ups, and surgery waiting lists soared as April approached.

    For urban employees, free medical care is what they want. But in China, having such a huge population base and skyrocketing medical expenses, the old public-funded health care system, which was formed half a century ago, has become utopian in recent years.

    (People's Daily November 22, 2001)

  • In This Series

    Social Security System Burgeons

    Nation's Pension System Working Well

    Pension Fund Liberalization Needed

    Key Points Highlighted in Medical Insurance Reform

    Medical Insurance Given Fat Market

    Beijing to Introduce Medical Insurance System

    Employers, Employees Pay New Medical Scheme

    Villagers Benefit From Rural Pension Insurance System

    Further Medicare Reform


    Hospitals Found to Overcharge Patients

    China's Pension System Reform to Be Quickened

    Elderly People in Rural Areas Need Help

    Rural Pensions Need Even Hand

    Society Faces Strains as Life Begins at 60


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