China’s new cooperative medical system: local approaches to medical insurance for the poor

Philip H. Brown, Colby College
Alan de Brauw, Williams College

China’s Cooperative Medical System collapsed with decollectivization, and millions of people fell into poverty as they struggled to pay healthcare costs. In 2002, the government responded by announcing a New Cooperative Medical System (NCMS) that re-establishes catastrophic insurance in rural areas by matching individual contributions with local and national subsidies. Instead of a single NCMS, however, the government has authorized officials in designated "experimental" counties to design and implement their own schemes. Counties thus differ in how the NCMS is promoted and administered, in ailments covered and in reimbursement rates, and even in willingness and ability to provide subsidies as required under the plan. However, the extent of variation remains poorly understood, even within China. We use a survey of village officials to describe differences in the promotion, costs, and administration of the NCMS across and within regions. This variation affects participation, and thus the long-term viability of the NCMS.