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The implication of health insurance for child development and maternal nutrition: evidence from China

The European Journal of Health Economics volume 17, pages 521–534 (2016)Cite this article

Abstract

We use the implementation of the new rural cooperative medical scheme (NCMS) in China to investigate the effect of health insurance on maternal nutrition and child health. Given the uneven roll-out of the NCMS across rural counties, we are able to deploy its implementation as a natural experiment in order to obviate problems of adverse selection that typically plague research on the effects of health insurance. We find that, among children, the NCMS has the greatest positive effect on infants between birth and 5 years of age. Also, with respect to female nutritional status, our models show that the NCMS has the greatest effect on women of childbearing age (aged between 16 and 35), indicating that women who benefit from the NCMS benefits may, in turn, give birth to healthier babies. Thus, taken together, our findings indicate that the NCMS plays an important role in health dynamics in rural China.

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Fig. 1

Notes

  1. The original Cooperative Medical Scheme (CMS) was first implemented in rural China in the 1950s [38]. It was organized at the village level and managed by the CMS Management Committee, consisting of village administration representatives and the village clinic staff. The CMS experienced dramatic development in its early years, and at its peak in 1978, it covered as many as 90 % of rural residents. It is believed by many that the program helped to reduce China’s mortality rate during the 1960s and 1970s. With the collapse of the collective economy in the early 1980s, most villages lost their collective welfare funds, which in turn resulted in the loss of the main source of financing for the CMS. As a result, counties began dropping the program and coverage rates fell sharply from 90 % in 1980 to 5 % in 1985.

  2. Other outcomes more directly related to insurance coverage include health care use and quality. Those worthy topics are the subject of another paper by one of the present authors that is currently under revision. In this paper, we focus on the effects of the NCMS on child health and maternal nutrition outcomes.

  3. A hukou is a record in the system of household registration required by law in mainland China. The system itself is more properly called "huji" and has its origins in ancient China. A household registration record officially identifies a person as a resident of an area and includes identifying information such as name, parents, spouse, and date of birth. A hukou can also refer to a family register in many contexts since the household registration record is issued per family, and usually includes the births, deaths, marriages, divorces, and moves, of all members in the family. The hukou system is often regarded as a caste system of China since relocation through migration does not reset one’s hukou. Rather, one’s hukuo status follows one from birth, with the exception that migrants can obtain their new location’s hukou status by obtaining a good job (e.g. Beijing) or by satisfying certain other conditions (e.g. Shanghai). Generally, “urban hukou” signals better social security benefits, a more prestigious occupation and a higher education level, while “rural hukou” implies the opposite.

  4. The vast majority of people with rural hukou status who move to the city are migrant workers (peasant-workers), and most of them are still covered by their rural NCMS. Therefore, results are not restricted to those with rural hukou who actually live in rural areas. There are only a few people with urban hukou who live in villages (i.e. reverse migrants), and they are primarily primary school teachers placed in these areas, industrial workers and people who work in public institutions (i.e. the civil service). Those “reverse migrants” are typically covered by the urban basic medical insurance system for urban workers (a form of health insurance in urban China). (The Fourth National Health Service Survey, NHSS). According to statistics by the fourth NHSS, 1.5 % of populations with urban hukou living in rural China were covered by the urban basic medical insurance.

  5. For the health insurance status of the interviewees, the questionnaire of the CHNS first asked “Do you have medical insurance?” followed by “Which of the following types of medical insurance do you have?” where “Cooperative insurance” is one of the options. Therefore, the CHNS showed both the health insurance and NCMS status of the interviewees. Anyone who reports having no medical insurance also implies that he/she was not covered by the NCMS.

  6. By 2003 most of the rural residents had no health insurance coverage because the CMS had collapsed for most of the villages. But it was potentially possible that a few people were still covered by the CMS.

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Acknowledgments

Xiaobo Peng is indebted to Qixiang Sun, her dissertation advisor. We also wish to thank Douglas Almond. Xiaobo Peng took Professor Almond’s class of “Topics in Health Economics”, from which she learned a lot about the fetal origins hypothesis. We thank China Scholarship Council (Nos. 201, 206, 010, 152) for assisting Xiaobo Peng studying in the United States for 1 year. All errors are our own. This paper is supported by the project “Research on Payment Mechanism Innovation and Public Hospital Reform in China” supported by the National Social Science Foundation of China (No. 14BGL145), and the significant project “Research on Establishing Security System of Social Fair and Maintaining Social Fair and Justice” supported by the National Social Science Foundation of China (No. 13&ZD042) and China Postdoctoral Science Foundation (No. 2015M571199).

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Affiliations

  1. Graduate School, Institute of Economics, Chinese Academy of Social Sciences, Liangxiang University Town, Fangshan District, Beijing, 100836, People’s Republic of China

    Xiaobo Peng

  2. Department of Sociology, New York University, 6 Washington Square North, New York, NY, 10003, USA

    Dalton Conley

Authors
  1. Xiaobo Peng
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  2. Dalton Conley
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Correspondence to Xiaobo Peng.

Appendix

Appendix

Table 7 describes the developmental trend and basic condition of the new rural cooperative medical scheme from 2004 to 2013.

Table 7 Basic statement of the NCMS from 2004 to 2013
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Tables 8 and 9 show the balancing t-tests of the difference in the means of the covariates between the control and treated groups in period 0 (baseline) for 2004 and 2006 for implementing the effect of participating in the NCMS on the health status of children, respectively.

Table 8 Descriptive Statistics for treatment and control groups at baseline before treatment (2004)
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Table 9 Descriptive statistics for treatment and control groups at baseline before treatment (2006)
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Table 10 presents estimates of NCMS enrollment on children’s probability of malnutrition by utilizing the county NCMS participation ratio as the IV.

Table 10 Estimates of the effect of NCMS on malnutrition by utilizing county participation ratio as instrumental variable (IV)
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Table 11 shows the regression results for the effect of the NCMS on malnutrition of children with standard errors adjusted for clustering on the household level.

Table 11 Estimates of the effect of NCMS on child malnutrition
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Tables 12 and 13 present the balancing t-tests of the difference in the means of the covariates between the control and treated groups in period 0 (baseline) for 2004 and 2006 for the estimation of the effect of participating in the NCMS on the nutrition of women at child-bearing age, respectively.

Table 12 Descriptive statistics for treatment and control groups at baseline before treatment (2004)
Full size table
Table 13 Descriptive statistics for treatment and control groups at baseline before treatment (2006)
Full size table

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Peng, X., Conley, D. The implication of health insurance for child development and maternal nutrition: evidence from China. Eur J Health Econ 17, 521–534 (2016). https://doi.org/10.1007/s10198-015-0696-7

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Keywords

  • NCMS
  • Health
  • Nutrition

JEL Classification

  • C13
  • I12
  • I18