Three Main Health Insurance Programs
Three major health insurance programs cover specific groups: rural residents under the New Rural Cooperative Medical Scheme (NCMS), urban employees under the Urban Employees Basic Medical Insurance (UR-BMI), and unemployed urban residents under the Urban Residents Basic Medical Insurance (UR-BMI).
The three schemes function differently in how they are financed and operate (Figure 2). Under the Ministry of Health, the NCMS as a voluntary program has expanded rapidly from 333 participating counties in 2003 to 2176 counties by 2009. Insurance coverage among rural residents increased more than seven-fold from 13 to 92% between 2003 and 2008.31 By 2009, 94% of rural residents had insurance coverage: 90% from the NCMS and 4% from other social health insurance programs.
County level governments determine the design of the NCMS for a rural population of about 840 million people. The UE-BMI, established in 1998, is a mandatory program for approximately 300 million urban employees administered at municipal level. The UE-BMI is currently estimated to cover about 67% of urban employees. The UR-BMI is the newest scheme intended to cover 200 million children, students, elderly, disabled, other non-working urban residents.
It was piloted in 79 cities in 2007, and has been rolled out nationwide. By the end of 2008, it covered 60.4% of the target population. Municipal governments determine the program’s design and reimbursement schemes.
Source of financing: NCMS. For the NCMS, premium contributions are subsidized by the government (at central and local levels) and individuals also contribute a share of the premium. At its re-initiation in 2003, the annual premium was 30 RMB per person (10 RMB each from central and local governments, and 10 RMB from individual residents).
With the increase in coverage, the government has gradually increased its subsidies to the program. By 2010, the annual premium increased to 120 RMB (US$ 17.6) per year (50 RMB each from central and local governments, and 20 RMB from individuals for poor regions).
In the wealthier regions, the local government is responsible for financing a larger part of the government share. Poor households are eligible for support from the Medical Financial Assistance (MFA) program, which covers the individual share of the NCMS contribution.