An Rx for Chinese Health

Article excerpt

For decades, China has been content to let the invisible hand of the market work its magic on the country's economy. But there's one area where the government wants to reassert state control: healthcare. The government recently developed a strategy to provide affordable medical insurance to 90 percent of its population by 2010 and 100 percent by 2020.

Today, 500 million Chinese--or nearly 40 percent of the population--can't afford to see a doctor. Respondents in a January 2008 poll of 101,000 households around the country named healthcare their top worry. Since the free market reforms initiated by Deng Xiaoping in 1978, out-of-pocket healthcare payments have ballooned from 20 percent of medical spending in 1980 to 49 percent in 2006. By comparison, Japanese pay just 15 percent of their medical spending out of pocket. The average hospital stay in China costs nearly as much as an individual's annual per capita income in the country.

Frustration with the high cost and low quality of care has recently reached fever pitch. Healthcare grievances have been at the heart of thousands of organized protests countrywide in recent years. …