Social Sciences in China (Chinese Edition)

No.5, 2017

The Income Redistribution Effect of the Growth of Public Health Expenditure

(Abstract)

Li Yongyou

Since the “new medical reform” in 2009, public health expenditure in China has grown markedly, bringing about a tremendously expanded supply of medical services. Using the compensating variation method and CFPS face-to-face survey data（2010-2014）, research on the expansion of outpatient services has found that more of the marginal benefits from the growth of public health expenditure have flowed towards low-income groups, but constantly increasing consultation fees burden the same group with higher fees for medical services. The government should alter the structure of financial subsidies to medical services and should increase subsidies and decrease charges for outpatient services for low-income groups to obtain a genuine solution to the problem of “medical services being unaffordable” for such groups. At the same time, the government in the future should continue to increase investment in and supply of health care services.