Private health insurance in China: a multilevel examination of its prevalence and distribution, and the impacts on access to healthcare and financial protection
Introduction: The role of private health insurance (PHI) in efforts to achieve Universal Health Coverage (UHC) is a matter of intense academic and policy debate. The government of the People’s Republic of China has sought to encourage the take-up of PHI at the same time as expanding the scope of social health insurance (SHI). This study investigates the role that PHI has played in the attainment of UHC goals in China, focusing on its prevalence, impacts on access to healthcare and financial protection, and inequalities in these outcomes. Methods: The study is based on longitudinal, stratified-sampling data from the China Health and Nutrition Survey. It employs multilevel logistic models to examine PHI prevalence and distribution in the population, and its effects on the utilisation of healthcare, while Heckman selection models and the zero-inflated count models are used to examine its effects on financial protection. It disaggregates the study population to explore inequalities in determinants of PHI prevalence, and access and financial protection attributable to PHI. Results: Coverage under PHI is unequally distributed, with enrolment higher among individuals of higher socioeconomic status and, at the aggregate level, in the more affluent east and urban areas than in the poorer inland and rural areas. As SHI coverage expanded to cover more of the population against more of the cost of healthcare, and for more treatment types, individuals with coverage under SHI in general became less associated with PHI enrolment than those without SHI. Compared to those without PHI, those with PHI and in need of healthcare was associated with higher utilisation of healthcare, especially in the east and urban areas. However, further analysis finds that this effect PHI was only present where individuals were also covered under SHI. Enrolment under PHI did not confer lower healthcarevi related financial risk than those without PHI but covered under SHI, while both PHI and SHI were associated with higher living standards. The effects of PHI on the community varied by geography. In the more developed east of China, higher PHI prevalence was associated with increasingly higher average utilisation for healthcare given increasing need. However, in the less developed inland regions, higher prevalence of PHI was associated with increasingly lower average utilisation given increasing need, and no significant effects on OOP payments. Conclusions: The study generates several policy-relevant insights. PHI has an inequitable distribution, with socioeconomically advantaged individuals and those resident in more affluent areas more likely to be enrolled. It confers greater access to healthcare for individuals in need of healthcare, from which those living in more affluent areas benefit more. It does not lower financial risk. Since 2004 its prevalence has increased only gradually over time, and as the scope of SHI has expanded, PHI has remained a relatively marginal source of coverage. These conclusions can inform analysis of the appropriate role of PHI in UHC efforts both in China and elsewhere, suggesting that if PHI is identified as a promising route forward, government subsidisations are needed to promote its coverage and strict regulations are required to address the inequalities that it causes.