Medical Cost Control: The International Experience And Practice In China

Since 70's of 20th century, the sharp increase in medical expenses, as well as how to control the excessive growth of medical costs has become a modern society's most important economic and social problems. In our country, caused by the new health system reform, the debating has been in a warm atmosphere, while at a new medical reform process, the medical research and the practical needs of cost control are especially important and urgent.Since the reform and opening up, while China's medical and health service system has basically taken shape, the continuing rise in health care costs became a serious threat to the stability of the whole health care system running. By analyzing the factors that affect the medical costs, this paper starts emphasizing market competition to control the rising role of the medical expenses. By introducing market reforms and competition pattern of China's present stage of medical services, proposes that China's new round of proposed health care reform can not return to the planned economy era systems, that is, public health, public hospitals, planned management, command-control-oriented old systems, but should further allow and expand private capital market access scope, encourage social capital to invest in the development of for-profit and non-profit medical organization, and to promote the healthy and orderly market competition in the medical service, and ultimately to control the rising cost of medical goals.For a long time, many countries in the world reform the entire health care system around ever increasing medical cost. Facts have proved that market forces alone can not effectively solve the problem of rising medical costs, it can not ensure the fairness and efficiency in the medical service arena, the role of government regulation and intervention should not be overlooked. Countries must face and weigh the pros and cons between the market force and government control. This paper, with reference to institutional arrangements for a series of reform programs carried out by United States over rising health care costs, explores the reality and issues of the market force and regulatory arrangements, and thereby provides experience and lessons for slowing down China's rising health care cost.Based on the basic assumptions that the development of for-profit medical institutions will generate and apply pressure of competition to non-profit hospitals, including general hospitals (referred to as government hospitals), thereby forcing them to reduce the per capita health care charges, in order to attract and retain the patient's. This paper mainly uses panel-data panel data model, selects per capita outpatient costs, per capita hospital costs in the general hospital health sector as the model explanatory variables, does a in-depth study of impact the for-profit hospital size have on the per capita medical cost of change. The analysis revealed that the proportion of the number of for-profit hospitals, the number of for-profit beds, as well as the average size of for-profit hospitals have important impacts on medical expenses of the general hospital sector. While we do not thrilled to see the decline of per capita health care costs of government hospitals in all cities across China's with for-profit hospital development, we do notice some of the per capita medical expenses actually declined slightly or with slower growth rate since 2006. And we find that the areas with the more intense competition in the medical service market, the more significant of the mitigation role by the development of for-profit medical institutions in the medical costs. It also further illustrates the introduction of market competition mechanism to promote medical and health system reform in China is still an important part in China's current health care reform.Supported by empirical research findings, for the control of ever rising medical costs, this paper finally put forwards four relevant policy recommendations, including:the introduction of effective competition in China's medical services market, the improvement of laws and regulations for effective competition, the nurture of competitive health insurance market, and the construction of effective medical control system.