**Figure 9 Average out-of-pocket spending on healthcare per capita by city, 2006** (RMB, % of annual income per capita)

<!-- Start of picture text --> 1800 16%<br>1600 14%<br>1400 12%<br>1200<br>10%<br>1000<br>8%<br>800<br>6%<br>600<br>400 4%<br>200 2%<br>0 0%<br>Shanghai Shenzhen Xi'an Chengdu Dalian Total<br>expenditure (RMB) % of annual income per capita<br><!-- End of picture text -->

**Figure 10 Out-of-pocket payment on average episode of care as a share of income per capita, by city, 2006**

<!-- Start of picture text --> 45% inpatient (as a share of annual income per capita)<br>outpatient (as a share of monthly income per capita)<br>40%<br>35%<br>30%<br>25%<br>20%<br>15%<br>10%<br>5%<br>0%<br>Shenzhen Shanghai Dalian Xi'an Chengdu<br>Figure 11 Cost of an average episode of care<br>as a share of income per capita, by city, 2006<br>70% inpatient care (as a share of annual income per capita)<br>outpatient care (as a share of monthly income per capita)<br>60%<br>50%<br>40%<br>30%<br>20%<br>10%<br>0%<br>Shenzhen Shanghai Chengdu Xi'an Dalian<br><!-- End of picture text -->

**_Analysis of the survey results implies a higher share of out-of-pocket payments as being somewhat correlated with the failure to seek care when sick_** (Figure 7) **_and with the incidence of early discharge_** – that is discharge at the patient’s request before recovery, against the physician’s advice – **_and with worse perceived overall health outcome_** .  Among the five cities, Shanghai, having the lowest out-ofpocket payments as a share of medical bills, also had the lowest share of population who fail to seek care when sick, the lowest incidence of early discharge against the physician’s advice (in less than 12% of hospitalization episodes) and the highest rate of perceived recovery (in over 68% of hospitalization episodes).

**_Related to the low perceived value for money, citizens revealed dissatisfaction with the health insurance system._** At the time of the survey in 2006, on average, 68% of the surveyed population in cities was covered by health insurance.  At the top among the five cities, Shanghai had 88% of the surveyed population covered by an existing health insurance scheme, compared to only 53% of the surveyed population covered in Shenzhen (see Figure 8). In interpreting these results, it should be noted that, thanks to new policy initiatives – such as the introduction of the basic medical insurance for the previously uninsured official urban residents, such as children, unemployed and

those outside the labor force – population coverage of health insurance schemes has continued to expand in China’s cities (as well as in rural areas) since 2006.<sup>7</sup>

# **_There are major differences in the service benefit package and co-payment levels among_**

**_the three types of health insurance schemes available in cities_** . As of 2006, the commercial insurance fared worst, covering only 13% of outpatient and 56% of inpatient visits in health facilities, and reimbursing 10% of outpatient and 39% of inpatient medical bills.  Social insurance schemes, on average, covered 58% of outpatient and 91% of inpatient visits in health facilities, and reimbursing 45% of outpatient and 57% of inpatient medical bills.

> 7  The increase in population coverage has been particularly fast in rural areas.  As of June 2008, RCMS covered 815 million (92% of) rural residents, as reported by MOH, _Report on the National RCMS Work_ (2008).  Similarly, a fast progress is expected in urban areas after the new scheme for urban residents has been introduced.

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