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Sleeping money: investigating the huge surpluses of social health insurance in China

  • JunQiang LiuEmail author
  • Tao Chen
Article

Abstract

The spreading of social health insurance (SHI) worldwide poses challenges for fledging public administrators. Inefficiency, misuse and even corruption threaten the stewardship of those newly established health funds. This article examines a tricky situation faced by China’s largest SHI program: the basic health insurance (BHI) scheme for urban employees. BHI accumulated a 406 billion yuan surplus by 2009, although the reimbursement level was still low. Using a provincial level panel database, we find that the huge BHI surpluses are related to the (temporarily) decreasing dependency ratio, the steady growth of average wages, the extension of BHI coverage, and progress in social insurance agency building. The financial situations of local governments and risk pooling level also matter. Besides, medical savings accounts result in about one third of BHI surpluses. Although these findings are not causal, lessons drawn from this study can help to improve the governance and performance of SHI programs in developing countries.

Keywords

Social health insurance Fund balances Health program administration 

JEL code

I13 

Notes

Ethical standards

This project was approved by the institution review board at author’s home institute (detailed in title page).

Conflict of interest

The authors declare no conflict of interest.

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Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Center for Chinese Public Administration Research, School of GovernmentSun Yat-sen UniversityGuangzhou People’s Republic of China
  2. 2.School of InsuranceSouthwestern University of Finance and EconomicsChengduPeople’s Republic of China

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