The Impacts of Flattening Fiscal Reform on Health Expenditure in China.

Jun Hao,Jiayi Jiang,Junli Zhu,Chengxiang Tang

doi:10.3389/fpubh.2021.614915

Abstract

Introduction: A number of provinces have implemented a fiscal reform of flattening government since the first decade of this century in China. This study aims to quantitatively analyze the influences of this government fiscal reform on county-level health expenditure. We also bring forward policy suggestions for improving county-level fiscal system and healthcare delivery.Methods: We collected a novel longitudinal county-level data from 2003 to 2010, including counties' socioeconomic data, fiscal revenue, and health expenditure. Jilin Province, Hebei Province, and Anhui Province were selected as representative samples for this policy evaluation. The study employed a time-varying difference-in-difference model specification to investigate the impacts of flattening fiscal reform on health expenditure.Results: The analyses find that the fiscal system reforms of the three provinces have a significantly positive impact on the health expenditure of county-level governments. However, we find no policy effects on the proportion of health expenditure to fiscal expenditure of county-level governments. The estimation results are robust after controlling several background variables.Conclusion: The results yield important policy insights that public finance and its reform significantly impacts health expenditures in China. The government may still need to strengthen the transfer payment system to guarantee the social welfare provision in healthcare.

Highlights

A number of provinces have implemented a fiscal reform of flattening government since the first decade of this century in China
It was found that the PMC reform of the three provinces had a significantly positive effect on the health expenditure of county-level governments (β1 = 2,004.9, p < 0.001), whereas we found no effects on the proportion of health expenditure to fiscal expenditure of county-level governments (β1 = 0.00, p > 0.05)
We evaluated the impact of the PMC decentralizing fiscal reform on health expenditure using longitudinal countylevel data from 2003 to 2010 in Hebei Province, Anhui Province, and Jilin Province in China

Summary

Introduction

A number of provinces have implemented a fiscal reform of flattening government since the first decade of this century in China. UHC requires that everyone has access to the services they need within the health system, where these services are of adequate quality to be effective, and get universal financial protection in the costs of using these services. It is the governments’ responsibilities to provide domestic resources to the maximum extent possible in order to fulfill their commitments to the health and other human rights of their citizens [1, 2]. Government budget health expenditure refers to the financial allocation of the central and local governments for healthcare, in which the health expenditure defined in this study refers to county-level governments’ health expenditure. The central and local governments in China have been inactive in providing healthcare for citizens, and China’s health sectors have been mainly financed by the private sectors [3]

Objectives

Methods

Results

Discussion

Conclusion