A medical worker talks with the relatives of a patient at the emergency department of the Second Affiliated Hospital of Anhui Medical University in Hefei, east China's Anhui Province, Jan. 21, 2023. Medical staff stick to their posts during the Spring Festival holiday. (Xinhua/Zhou Mu)

A number of Chinese localities, including Central China's Hubei, Southwest China's Sichuan and Northeast China's Heilongjiang, are implementing a reform of health insurance for urban employees and retirees, drawing widespread attention.

Industry observers said the reform, which reduces the amount deposited each month into personal accounts, doesn't mean the reduction or loss of health insurance benefits, nor is it a move to cover COVID-19-related expenses, as some Western media asserted.

The health insurance reform is a decision that has been made after years of discussion, planning and prudent consideration and places Chinese families in a better position to cope with medical risks, and elderly people who are more susceptible to illness and incur higher medical expenses will benefit the most from the reform, observers said. 

Wang Chaoqun, associate professor from Department of Labor and Social Security at Central China Normal University, told the Global Times on Sunday that under the new plan, the reform can reimburse outpatient bills and alleviate the financial burdens of the insured, especially elderly people or those who often visit doctors and find it is not enough to pay for their expenses. 

Previously, the money within personal accounts was far from sufficient in covering medical costs in hospitals and pharmacies. Data showed that in a metropolis where about 5 million people had joined the medical insurance system, less than 5 percent of personal accounts had balances of more than 10,000 yuan ($1456), and fewer than 1 percent had balances of more than 20,000 yuan, Wang noted. 

The threshold for the reimbursement percentage of outpatient medical bills is 50 percent, and in some cities such as Xiamen, a city in East China's Fujian Province, the level can reach as high as 98 percent, according to Wang. 

For those who rarely see doctors and have tens of thousands of yuan sleeping in their accounts, the reform will feel like a loss in the short term, but when they get older or if they become sick and need to see doctors frequently, they will eventually find that they benefit from the reform, Wang said. 

China's health insurance system for urban employees and retirees consists of two parts: mandatory personal accounts with contributions from both employees and their employers that mainly pay for ordinary outpatient services; and a pooled fund contributed by employers that is used to reimburse hospitalization bills, outpatient bills for serious diseases, and expenses for some chronic diseases, according to the Xinhua News Agency.

After the reform, money deposited by employers into employees' personal accounts will be directly paid to the pooled fund in order to support the reimbursement of ordinary outpatient medical bills. The reform was officially rolled out by the State Council in April 2021.

Some Western media have deliberately linked the reform of the health insurance to COVID-19 and asserted that the reform is trying to allocate money from personal accounts to make up the deficit of the medical insurance fund.

Their claims are made only to smear China and lack foundation, experts said. The pooled fund has made ends meet over the years, Jin Weigang, a professor at Zhejiang University, told the Global Times.

The total revenue of China's basic medical insurance funds in 2021 reached 2.8 trillion yuan (around $439.7 billion) and the expenditure was 2.4 trillion yuan, according to the National Healthcare Security Administration (NHSA).

The reform is a decision that was made after years of discussion and in 2010, the Social Security Law laid a legal ground for the health reform, Wang noted, refuting any link between COVID-19 and the reform.

During the COVID-19 epidemic, fees for vaccines and nucleic acid testing were financed by the state, and some COVID-19 treatments and drugs were covered by the health insurance fund because it fit the reimbursement policy, Wang noted. 

Compared with other countries, the benefits of China's health system are obvious. China has built a national basic medical insurance system covering over 1.36 billion people, accounting for over 95 percent of the entire population. It is a mission hardly imagined for a developing country.
  
But in the US, before Obamacare, as much as about 30 or 40 million Americans were uninsured and numerous studies have shown that the first cause for people to go bankrupt in the US is the extreme high cost of medical care, observers noted.