China Health Insurance
The complete guide!

How does the state health insurance system work?

Chinese government spending on public health is relatively low in global terms. Healthcare is financed primarily from three sources: government subsidies, state-run insurance, and out-of-pocket payments. The health insurance system is therefore essentially a hybrid of public and private funding.

Under the country’s Communist regime, all hospitals are owned by the state and are thus public, but only a small part of their funding comes from taxation. The rest comes from out-of-pocket payments made by patients, and from insurance. Even though everyone in China is technically covered by national health insurance, patients still end up making considerable payments themselves for their healthcare.

The quality of that healthcare is also patchy: although health initiatives — particularly vaccination programmes — have increased life expectancy in China over the last few decades, the populations of urban areas have much better facilities and access than those in rural regions. However, the big urban hospitals suffer from significant overcrowding. Patients must pay for a ticket in order to have a consultation with a hospital doctor and waiting times can be long.

Health insurance funds are managed by regional authorities. If you live in a wealthy region, you will pay more for your contributions, but will gain wider benefits. In a rural area, your health insurance will be cheaper, but more restricted.

If you are in Shanghai, for example, and entitled to national health cover, you will have around 85% of your medical costs reimbursed, with an annual cap of about $740,000. If you are in the rural area of Guiyang the reimbursement rate is around 65%, capped at $29,000. Around 44% of Chinese residents below the poverty line experience financial problems due to out-of-pocket payments for their healthcare.

Health insurance in the individual regions currently consists of three types. Urban Employee Basic Medical Insurance (UEBMI) provides basic cover for urban enterprise employees, and Urban Resident Basic Medical Insurance (URBMI) provides basic cover for other urban residents. These are administered by the Ministry of Human Resources and Social Security and run by local authorities.

In addition there is the New Rural Cooperative Medical System (NRCMS), which offers rural cooperative medical insurance for the farming population. This is run by the National Health and Family Planning Commission and administered by local authorities. All these forms of insurance can be voluntarily joined at an individual level. Note, however, that the government is currently working on integrating part or all of these schemes into a unified system: part of the aim of providing China with universal coverage.

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Who is eligible for state healthcare?

As an expat, you will be eligible for national health insurance in some regions, but it depends where you are working. Some Chinese areas will not require you to make national health contributions, but you also will not be able to access the public system. You may, however, be able to make voluntary contributions in some places: check with your employer or your local social security authority.

Coverage for the following has been technically extended to expats:

  • old-age pensions
  • compensation for workplace accidents
  • unemployment benefits
  • maternity leave
  • medical insurance

However, this does not extend to all areas or all benefits. In Beijing, for instance, you will be entitled to all of the above if you are paying into the system. In Shenzhen, you will only be covered for pensions and health insurance; and Shanghai has not yet implemented the legislation at all for expats: here, you will have to take out private cover.

How do you apply to join the state health insurance system?

If you are working, your employer may sign you up for a regional health insurance scheme, depending on where you are based. If you are in one of the cities, this is likely to be the Urban Employee Basic Medical Insurance scheme (UEBMI), which is compulsory. Your contributions will be deducted from the payroll.

If you are not working or are self-employed, you may be able to join a regional scheme voluntarily.

You can sign up with a local GP (in some rural areas, village ‘doctors’ are not licensed GPs and can only work in clinics), and you do not always need a referral to see a specialist. You can see a specialist in an upper-level hospital on your own initiative if you choose to do so. Local health authorities and the Bureaus of Commodity Prices will regulate the fees charged by your primary healthcare provider, and you will need to pay your doctor or hospital upfront at the point of service.

What is covered by the state health insurance system?

National health insurance will cover:

  • primary care
  • hospital care
  • specialist care
  • emergency care
  • mental health care
  • some prescription drugs
  • traditional Chinese medicine
  • optometry

Some hospital treatment is now paid for directly by your insurance provider, but this will only be applicable to government-approved hospitals and clinics, excluding “international” or VIP clinics. Otherwise you will need to pay first and then put in a claim to your insurance provider. However, there are caps on the amounts that primary and secondary healthcare providers are able to charge.

Only severe cases of mental illness will be treated in hospital: other forms of mental health treatment will be on an outpatient basis.

Long-term care outside the household unit is rare and there is little provision in the public health sector for this, as regards either insurance or treatment, although you may receive some support from your local community hospital.

You can use facilities which are outside the public health network and put in a claim, but in this case your co-payments will be higher.

There are reimbursement caps, which are lower for outpatient than inpatient care.

If you are working and pregnant, your employer must make maternity contributions. Your maternity payments will be made monthly and will be based on women’s average wage in your company, not on your own salary. Your employer must have paid three months of monthly contributions for you already, and any related medical services must be compliant with China’s family planning policy. There is a form of paternity leave available in some cases, but you will need to check with your employer to see whether this applies to your family.

Some prescription drug costs are covered, but the biggest percentage of out-of-pocket spending in China is for medication.

Are retirees covered by state medical insurance?

If you have retired in one of the cities which allows expats to access the system, you will be covered by Urban Resident Basic Medical Insurance (URBMI), which is aimed at the non-working urban population. Your household will need to make some payments into the system on an individual basis, but the rest will be funded by the government. If you are living in an area that does not allow expats to access the system, then you will need to take out private cover. You can check whether your region offers cover on the government’s website.

Are students covered by state medical insurance?

International students are not covered by the national schemes and are advised to take out private health coverage. Some universities offer tailored packages specifically for international students.

Will your family be covered by your insurance?

Check with your employer to find out if your health insurance covers your dependents: some employers offer supplemental health cover as an added incentive. This will be with a commercial provider and may include family cover.

Otherwise, your dependents will not be covered under your insurance, but may be able to make voluntary contributions to URBMI.

Is dental treatment covered by state health insurance?

Basic dental services such as extraction are covered under national plans, but non-essential care such as cleaning, or more advanced care, are not covered and you will need to pay upfront or take out a private dental plan. Make sure that your dentist accepts your private insurance, however: many of them do not.

What are the contribution rates for state health insurance?

These vary from region to region but on average, your employer must pay 6-10% of your salary and you must contribute 2%. You can access public healthcare if you are self-employed, but you must make contributions: it is illegal not to do so. If you are an urban resident who is not working, both you and the state will cover your health insurance contributions under URBMI. However, you will still need to make significant out-of-pocket payments for any treatment.

Note that the Chinese government is currently revising social security payments and reducing the rates that employers have to pay. Your 2% should remain unchanged, however.

Why buy private health insurance?

Chinese hospitals suffer from substantial overcrowding and long waiting times for both diagnosis and treatment. The quality of healthcare also varies greatly, with a high standard of medical care tending to be confined to large urban areas. As noted above, in some regions expats may not be entitled to access the public healthcare system. For these reasons, many expats choose to take out private cover.

If you do so, take care that you do not purchase an unlicensed plan from an offshore company which is not registered to trade in mainland China, and be aware that a public hospital may not accept international health insurance policies. If possible, check with your private provider before you are admitted, or with the hospital itself. You may also seek treatment at a private clinic or hospital if you are paying for yourself in full.

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What is covered by private health insurance?

Due to treatment gaps between national health insurance and public healthcare, in addition to regional variations in health cover, you may need private insurance to cover more advanced dental care, prescription drugs, home care and hospice care in addition to speed of access for diagnosis and treatment and more advanced facilities.

How much does private health insurance cost?

This will depend on factors such as your age and any pre-existing conditions, and the kind of package you opt for; a more expensive insurance package will give you more a extensive range of treatment and facilities. As so many variables have an effect on the cost of international private medical insurance in China, it becomes very difficult to give accurate estimates without knowing the full details of the coverage required. However, as a very rough guide, using a standard profile of a 40-year-old British male with no deductibles, no co-insurance, a middle-tier plan, all modules included and worldwide coverage excluding the US, a ballpark price of around £4,000/$5,000 might be expected. Were coverage to be expanded to include the US then the premium could increase to almost double that amount.

Which companies offer private health insurance?

The big international providers cover China, including:

  • Aetna
  • Allianz
  • AXA
  • BUPA
  • Cigna Global
  • InterGlobal
  • MSH

You may also be able to find a local provider, but it is advised that in this case you go through a specialist broker who has experience with the Chinese market.

Glossary of health insurance terms

New Rural Cooperative Medical System (NRCMS) - rural cooperative medical insurance for the farming population

Urban Employee Basic Medical Insurance (UEBMI) - basic cover for urban enterprise employees

Portal de Saúde do Cidadão - Citizens’ Health Portal

Urban Resident Basic Medical Insurance (URBMI) - basic cover for other urban residents, such as children and the elderly.

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