Application of Smart Healthcare in LTCI, Outpatient Mutual-Aid Guarantee Mechanism, and Sustainability of Medical Insurance Fund for Urban Employees

With the aggravation of population aging and the increase of life expectancy, long-term care insurance (LTCI) system has been established to meet the medical and long-term care needs of the increasing elderly population. In China, LTCI system is currently not a stand-alone insurance, but it is attached to the national basic medical insurance fund for urban employees (MIUE). As a result, the expenditure of LTCI is a part of the expenditure of the MIUE, which has an impact on the sustainability of the MIUE. By modeling the income and expenditure of MIUE, especially including the expenditure of LTCI, this study optimized an LTCI system with a higher individual out-of-pocket payment ratio of LTCI and implementation of the outpatient mutual-aid guarantee mechanism (OMAGM), which could improve the sustainability of the MIUE. The study also reveals the following: (i) solely increasing individual out-of-pocket payment ratio of LTCI to 20%–50% can only postpone the deficit on Social Pooling Accounts (SPAs) by 1 or 2 years, and the effect is very limited. (ii) Besides a higher individual out-of-pocket payment ratio, further implementation of a partial OMAGM from 2022 will postpone the deficit on SPAs by 7–9 years, and the implementation of a complete OMAGM from 2022 will postpone the deficit by 14–18 years. Accordingly, China should implement OMAGM as soon as possible to enhance the solvency of MIUE fund, and, in the long run, an independent LTCI scheme should be established to ensure the stability and sustainability of the LTCI fund and the MIUE fund.