Cost Estimation For High Medical Cost Social Insurance

High medical costs social insurance is an important part of our social security system. In this paper, we will use Social Security actuarial theory methods to do some study based on the commercial high medical costs insurance actuarial theory. This paper reviews the development history of China's social security system. Also gives an brief introduction of three major actuarial models for high medical costs insurance, which are Experience Frequency method, Truncated Pareto distribution method and Lognormal method. Then use the new-type rural cooperative medical care inpatient medical cost data of certain district of Shanghai to verify the different methods, compare their applicability and get some conclusions. Based on the above study, this paper proposes an improved model of experience frequency method con-sidering the different purposes of social security and commercial insurance and also does the verification. The difference is social security has the social responsibility to optimize the allocation of medical resources.