Social Inequalities & Health in Urban China Beatriz Carrillo Garcia China Studies Centre, the University of Sydney

Health Reform Phases in the PRC FIRST PHASE 1949 – 1978 Ambitious public health campaign to provide universal basic and affordable health services The principle of egalitarianism drives policy Urban China: Social insurances (health, old age) and other benefits (lifetime employment, housing, schooling, etc.) provided through SOEs and collective enterprises (State supported) Health insurance covered dependants Rural China: RCMS, funded collectively, basic medical care

Economic Reform and Health Life expectancy 1949 – 35 years 1979 – 67 years 1990 – 70 years 2000 – 72 years 2013 – 74.8 years Urbanization (% urban population) 1978 – 17% 1990 – 26.41% 2000 – 36.22% 2012 – 52.57% SECOND PHASE OF HEALTH REFROMS Policy discourse: Egalitarianism portrayed as negative (i.e. equal but poor)/ Inequality: incentive to spur innovation and economic growth Demographic and epidemiological transition: Declining fertility (one child policy) and rapid population ageing Rapid urbanization: mainly due to rural-to-urban migration Higher Incidence of NCDs (linked to both aging and rapid urbanization) Changes to government funding of public hospitals and clinics Government spending as a % of THE decreases; market mechanisms introduced into health sector Public hospitals increasingly depend on fee-for-services (emphasis on expensive curative services and drugs 1995 – drug sales accounted for as much as 60% of hospital revenue Rising health care cost and out-of-pocket expenses for users

Changing Government Funding YearTHE as % of GDP Govt. Ex. as % THE Private Ex. as % THE Government Health Ex. as % of total Govt. Ex. Social Health Insurance Funds as % of total Govt. Ex

Third Phase of Health Reforms THIRD PHASE Reinstate the role of the State in health provision – build a more equitable harmonious society Build social health insurances alongside social assistance 1998 Urban Employee Basic Medical Insurance (UEBMI) 1993 – just over 50% of urban residents had social health insurance (employees + dependants 2003 – 42% of urban employees had social health insurance (UEBMI) Rural migrant workers not covered 2003 New Rural Cooperative Medical Scheme reestablished 2005 Medical Financial Assistance (MFA) scheme (tied to social assistance - dibao) 2007 Urban Residents Basic Medical Insurance (URBMI) piloted (established nationally in 2010) 2011 covered 74% of targeted population (children, students, elderly or otherwise not employed) Upfront payment and low reimbursement rates(average 45% - URBMI)

Fourth Phase of Health Reforms FOURTH PHASE Substantial increase in government funding for social health insurances and the MFA Raising reimbursement rates; curbing medicine prices Real safety net for catastrophic health expenses (Western regions, rural population, urban poor) 2013 National Health & Family Planning Commission (relaxation of one child policy) Meet the challenges of: Population aging ( % in 2010, 24% ) and NCDs Soon to peak working age population

Socio Economic Status and Health Outcomes in Urban China National Health Services Survey [NHSS] China Health and Nutrition Survey [CHNS] The degree to which health is associated with income (inequality) more than tripled between 1991 and 2006 (Baeten et al 2012) Region is a major determinant of health (where a city is located) Differential income mobility by age, gender and region accounted for 70-90% of evolution in income-related health inequalities Higher incidence of chronic disease amongst urban elderly across the socioeconomic gradient, worst among women over 55

Socio Economic Status and Health Outcomes in Urban China The old working class: Life course cumulative disadvantage: sent down to the countryside (Cultural Revolution), laid-off during reform period, loss of status, new urban poor Health utilization (inpatient care) remains low despite URBMI coverage; out-of-pocket expenses remain high (for all income groups) Those who experienced downward mobility more likely to report worse health (especially mental health problems)

Socio Economic Status and Health Outcomes in Urban China Rural migrant workers: Healthier than the urban population (younger) Their hukou status not as significant as their SES and demographic characteristics But hukou restricts their access to health resources (e.g. insurances) Low social status – stigma: limited social capital Social isolation, poor adjustment to urban society – higher rates of depression have been observed amongst this population

Harmonious Society & Health Equity Return of the discourse of equality and social justice Important role of the State in redistribution (provision of public goods) Will income inequalities be halted? Or will social insurance and safety nets be band-aids for the more vulnerable populations, rather than equalising programs?