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Multicenter Study
. 2010 Oct 21:341:c5617.
doi: 10.1136/bmj.c5617.

New evidence on the impact of China's New Rural Cooperative Medical Scheme and its implications for rural primary healthcare: multivariate difference-in-difference analysis

Kimberly Singer Babiarz  1 , Grant Miller, Hongmei Yi, Linxiu Zhang, Scott Rozelle
Affiliations
Multicenter Study

New evidence on the impact of China's New Rural Cooperative Medical Scheme and its implications for rural primary healthcare: multivariate difference-in-difference analysis

Kimberly Singer Babiarz et al. BMJ. .

Abstract

Objectives: To determine whether China's New Rural Cooperative Medical Scheme (NCMS), which aims to provide health insurance to 800 million rural citizens and to correct distortions in rural primary care, and the individual policy attributes have affected the operation and use of village health clinics.

Design: We performed a difference-in-difference analysis using multivariate linear regressions, controlling for clinic and individual attributes as well as village and year effects.

Setting: 100 villages within 25 rural counties across five Chinese provinces in 2004 and 2007. Participants 160 village primary care clinics and 8339 individuals.

Main outcome measures: Clinic outcomes were log average weekly patient flow, log average monthly gross income, log total annual net income, and the proportion of monthly gross income from medicine sales. Individual outcomes were probability of seeking medical care, log annual "out of pocket" health expenditure, and two measures of exposure to financial risk (probability of incurring out of pocket health expenditure above the 90th percentile of spending among the uninsured and probability of financing medical care by borrowing or selling assets).

Results: For village clinics, we found that NCMS was associated with a 26% increase in weekly patient flow and a 29% increase in monthly gross income, but no change in annual net revenue or the proportion of monthly income from drug revenue. For individuals, participation in NCMS was associated with a 5% increase in village clinic use, but no change in overall medical care use. Also, out of pocket medical spending fell by 19% and the two measures of exposure to financial risk declined by 24-63%. These changes occurred across heterogeneous county programmes, even in those with minimal benefit packages.

Conclusions: NCMS provides some financial risk protection for individuals in rural China and has partly corrected distortions in Chinese rural healthcare (reducing the oversupply of specialty services and prescription drugs). However, the scheme may have also shifted uncompensated new responsibilities to village clinics. Given renewed interest among Chinese policy makers in strengthening primary care, the effect of NCMS deserves greater attention.

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Conflict of interest statement

Competing interests: All authors have completed the Unified Competing Interest form at www.icmje.org/coi_disclosure.pdf (available on request from the corresponding author) and declare that: all authors had support from Stanford University’s Presidential Fund for Interdisciplinary International Studies, Massachusetts Institute of Technology, the Chinese Academy of Sciences (Science 100 and KSCX2-YW-N-039), and Social Protection in Asia’s (SPA) policy research and network building programme; no relationships with companies or organisations that might have an interest in the submitted work in the previous 3 years; and no other relationships or activities that could appear to have influenced the submitted work.

Figures

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Location of the counties sampled in the provinces of Jiangsu, Sichuan, Shaanxi, Jilin, and Hebei
See this image and copyright information in PMC

Comment in

References

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