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Universal Healthcare Is Within Reach

Author: Yanzhong Huang, Senior Fellow for Global Health
January 13, 2012
China Daily


Nearly three years ago China's State Council unveiled its plan to extend healthcare to every Chinese citizen by 2020. The ambitious plan was launched at a time when universal health coverage was building momentum globally. In June 2009 US President Barack Obama outlined his plan for a universal healthcare system in the US, vowing to "give every American quality healthcare". Indeed, most emerging economies have either officially implemented or unveiled blueprints toward universal healthcare. India, for example, also aims to have universal care by 2020.

Unlike these countries, China's pursuit of that aim has been driven by two important developments. First, an annual growth of 20-30 percent in government revenue (which outstrips GDP and income growth) has enabled (if not obliged) the government to invest in the country's long neglected healthcare sector. Second, the government hoped to use universal healthcare to boost domestic consumer spending, which has long been suppressed in large part because of the absence of a well-developed social safety net.

Can the goal be achieved by 2020? By the end of 2011 the government should have pumped 1.3 trillion yuan ($173 billion; 133 billion euros) into the health sector. Thanks to the revved-up government commitment, more than 95 percent of Chinese people are already covered by some kind of basic health insurance. Provided the government sustains its commitment to healthcare, it should be relatively easy for China to achieve near universal health insurance coverage by the end of this year.

But this is far from sufficient for achieving universal healthcare. According to the World Health Organization, universal coverage of healthcare occurs when "everyone in the population has access to appropriate promotive, preventive, curative and rehabilitative healthcare when they need it and at an affordable cost". By focusing on equity of access and equity in financing, a universal healthcare package thus entails a fundamental set of solutions to the problems of access (kan bing nan) and affordability (kan bing gui).

On access the concern is not the lack of health resources but the way these resources are distributed. Thailand, which introduced universal coverage as early as 2001 and managed to sustain the program despite several administration turnovers, has a much lower number of physicians and hospital beds per 1,000 people than does China, where a disproportionate amount of healthcare resources have traditionally been concentrated in larger hospitals, particularly those in urban areas. The urban-rural gap can be exacerbated by rapid urbanization, which is expected to sustain the demand for more and better urban healthcare.

The challenge is even greater when it comes to the issue of affordability. The national rate of health insurance coverage is very high, yet the benefits remain very limited. By the end of 2010 nearly 36 percent of total health spending in China was borne by out-of-pocket spending. The percentage is still much higher than that in 1978 (21 percent). The Ministry of Health recently announced its plan to reduce the share of out-of-pocket payments to 30 percent by 2015. Fulfilling this goal would be a milestone toward effective coverage, given the out-of-pocket share in most countries with universal health coverage is lower than 30 percent. The share in Thailand, for example, was 26.8 percent in 2007.

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