Co-Ordination And Raising Of The New Cooperative Medical Scheme (NCMS) Funds

Integration of both urban and rural medical insurance is an inevitable trend of development of Chinese medical security cause, but restriction on supply of medical insurance funds has become its major obstacle. Taking the NCMS funds as the main research object, the paper analyses the status quo of supply and demand of NCMS funds by combination of normative, positive, and comparative methods, based on it discusses practical path of“co-ordination in advance”for integration of both urban and rural medical insurance under financial restriction and finally investigates necessity, potential level and feasible path of co-odination of NCMS Funds.The new type of rural cooperative medical service has been launched for more than eight years in China. Its participant has exceeded 95 percent of those who are involved in the agricultural section and also the scale of fund has gradually enlarged. However, the county-level arrangement of the NCMS funds have led to a series of problem such as regulatory difficulty, decrease of anti-risk capability of the fund, restriction on adjusting room for fund, deficient exertion of the fund’s function, impairment of insurance fairness. Therefore, heightening the arrangement level of NCMS funds can in effect overcome malpractices mentioned above and improve the insurance participant benefit. The Social Insurance Law that is newly promulgated has included enhancing arrangement level of kinds of social insurance fund and consequently issues on enhancing the arrangement level of NCMS funds will receive concern from both researchers and policy-makers.The paper mainly focuses on NCMS Funds, analyses its necessity, potential level and feasible path by combination of normative, positive, and comparative meathods. Meanwhile it predicts not only the demand status of NCMS Funds based on the province-level arrangement but supply status of NRCF according to the current financing model of the new type of rural cooperative medical service (NCMS), measures the gap between them and designs corresponding adjustive scheme of financing policy. Finally, in light of funds constraint of China’s different type of mecial insurance, the paper discusses realistic path of integrating both urban and rural medical insurance.Based on the current financing model of NCMS as well as its participating ratio and fiscal expenditure, the NCMS funds will manifest a steady increasing trend within 10 years. Supposedly according to the current compensation policy, the NCMS funds will see a trend of oversupply from 2009 to 2020. Nevertheless, the current compensation policy of the urban resident’s medical insurance of NCMS funds has such problems as less scope and lower writing-off ratio drawn by the government. In order to realize relative integration of both urban and rural medical insurance system that enables the urban employee’s medical insurance, the urban resident’s medical insurance and NCMS funds to enjoy the same compensation scope and writing off ratio, we should intensify the degree of the fiscal compensation and raise the payment standards of the participant and as to finance of NCMS funds, Central finance must play an bigger role in expenditure. In light of the current both urban and rural resident income level, within10 years there exists great difficulty in achieving absolute integration of medical insurance that leads both the urban employeement and the urban resident medical insurance along with the participant of NCMS to experience completely equal medical service treatment. Therefore, for the sake of ultimately implementing integration of both urban and rural medical insurance, a developmental path of“overall-arrangement in advance and integration later on”would be feasible and practical. Co-odination of NCMS funds spans county-level, city-level, province-level and national-level and provincial arrangement is its indispensable ultimate level. Choice of cross-city arrangement path means under the mature condition directly improving the arrangement level of the medical insurance fund from county-level to the provincial level. It can not only overcome kinds of problems of the lower level arrangement, but also save cost. However, presently, areas of comparatively advanced economy may be allowed to attempt the path of level by level arrangement.