Has China’s new health care reform improved efficiency at the provincial level? Evidence from a panel data of 31 Chinese provinces

Abstract

China’s new health care reform commenced in 2009, and since then a huge amount of financial resources has been invested to improve public access to basic medical and public health services. This study used the data envelopment analysis (DEA) Malmquist methodology and TOBIT models to examine the changing trends in total factor productivity (TFP) and the impact of policy on the efficiency of China’s health care system at the provincial level between 2003 and 2011. The results reveal that despite the health care reform, the TFP of both medical and public health services declined after 2009. Moreover, there were larger differences across provinces and regions. The health care reform initiated in 2009 has in fact had a significant negative impact on the efficiency of public health services, while its effect on medical services has been insignificant. On the basis of these results, this article explores the implications for future reform strategies in China.