Healthcare Expenditures among the Elderly in China: The Role of Catastrophic Medical Insurance

Abstract

China has been piloting the catastrophic medical insurance (CMI) program since 2012 and rolled it out nationally in 2016 to reduce the incidence of catastrophic health expenditure among Chinese residents. Few studies have been conducted to determine its effect on healthcare expenditures, particularly among the elderly. The purpose of this study is to examine the effect of CMI on healthcare expenditures among China’s elderly population. The data for this study were derived from 4 waves of the Chinese Longitudinal Healthy Longevity Survey, which included 344 and 1199 individuals in the treatment and control groups, respectively. To examine the effect of CMI on healthcare expenditures among the elderly, we used difference-in-differences and fixed-effects models. Additionally, a heterogeneity analysis was used to examine the differences in the impact of CMI on different groups. Finally, we confirmed the robustness of the results using robustness and placebo tests. CMI increased total health and out-of-pocket expenditures significantly, as well as inpatient and corresponding out-of-pocket expenditures. The reassults of the heterogeneity analysis indicated that CMI had a greater impact on elderly residents of rural areas. Economic burden protection has been enhanced for low-income groups and patients with serious diseases over the last two years. Our research indicated that CMI can promote the use of inpatient medical services for the elderly to a certain extent. Targeted measures such as expanding the CMI compensation list, establishing a more precise compensation scheme, and specific diseases associated with high healthcare expenditures can be considered in the practice of CMI implementation.