A Study on the Equity Dilemma and Reform Strategies of Drug Reimbursement in China’s Medical Insurance System

TL;DR

This study examines how income affects drug choices in China's medical insurance system, revealing that higher-income patients tend to choose costlier drugs, leading to unfair reimbursement.

Contribution

The study provides empirical evidence on income-driven drug selection in China's medical insurance system, highlighting equity issues under the current reimbursement mechanism.

Findings

Higher-income insured individuals tend to choose higher-cost drugs, increasing hospitalization drug costs.

Regression analysis shows a significant positive relationship between income and drug costs for both urban and rural insurance participants.

The current proportional reimbursement system leads to unfair compensation for higher-cost drug choices.

Abstract

Background: The continuous expansion of the National Reimbursement Drug List has led to an increasing cost disparity among alternative drugs for the same indications. Under the current proportional reimbursement mechanism, choosing higher-cost treatments often results in higher compensation. Given the lack of empirical evidence on whether income affects the medication choices of insured individuals in the Chinese context, this study aims to evaluate the impact of income levels on drug selection, providing a basis for optimizing the medical insurance reimbursement policy. Methods: This study extracts data from hospitalized patients enrolled in basic medical insurance from the China Health and Retirement Longitudinal Study (CHARLS) database and preprocesses it in Excel. Subsequently, SPSS is used to conduct descriptive statistics, difference analysis, correlation analysis, and regression analysis on the processed data to explore the impact of income levels on drug selection. Results: After controlling for length of hospitalization and hospitalization costs, the regression coefficient for urban employee basic medical insurance participants is β = 0.505 (p < 0.01), and the regression coefficient for new rural cooperative medical insurance participants is β = 0.195 (p < 0.01). This means that, regardless of whether participants are enrolled in urban employee basic medical insurance or new rural cooperative medical insurance, an increase in income will lead to higher hospitalization drug costs. Conclusions: Compared to low-income insured individuals, high-income participants in the basic medical insurance are more likely to choose higher-cost drugs among alternatives, which leads to unfair reimbursement under the current proportional reimbursement system.