Health Insurance and Payment System Reform in China

Payment system reform has become one of the primary targets of Chinese healthcare reform since 2009. This chapter describes the development of China’s insurance system, along with a review of the policy and impacts of payment reform from fee-for-service to alternative schemes, while focusing on capitation payments. In China, public programs presently cover most of the population; the participation of private insurance firms is limited. Studies to date have found no significant impact of capitation payment on total medical expenditure. The reason could be that providers are slow to respond. Also, the impact could have been diluted because reforms were implemented only on some insurance programs paying providers, but not all.