China policy proposal of the day

Shouldn’t this story be on p.1 of every newspaper?

Now China’s government has unveiled a controversial plan to achieve universal care that would both increase health-care funding and control prices.

As this morning’s WSJ explains, the proposed plan would be quite a shift for China. The draft plan’s overall goal is to cover 90% of the population within two years and achieve universal care by 2020. It aims to return to non-profit national health care, an idea that was largely abandoned in the country 1980s.

This all stands in contrast to China’s current system, which provides little government funding to government hospitals and requires patients to pay heavy out-of-pocket expenses. The WSJ notes that out-of-pocket payments made up more than 60% of health spending in China at the end of the 1990s.

The plan – drafted in consultation with groups including the World Health Organization, the World Bank, consultant McKinsey & Co. and a few Chinese university-based public health experts – requires all revenue raised by public hospitals to be funneled to the state. The government also aims to set pricing standards for medical services.