Rural Residents Of The Poverty Impact Of The Cash Expenditure On Health In Gansu Province

Out-of-pocket payments (OOP) for health care are largely unpredictable and potentially have an impoverishing effect. With a lack of insurance cover, illness and consequent expenditure on health care can severely disrupt living standards. A household with a member succumbing to illness may be forced to spend a large fraction of its resources on health care at the expense of other goods and services, and can push the family into poverty, or further into it if they are already there. A well-off household can finance medical expenses from savings, or by cutting back on luxury items of consumption. A less well-off household is forced to cut back on necessities and may be pushed into poverty. Households that are already poor may be pushed further below the poverty line. From the equity ethical position, is that spending on health care should not push households into poverty—or further into it if they are already there.In China, with the new rural cooperative medical insurance system development, the medical expendicure of rural residents is gradually reduced. According to a relevant research of China Health Economic Institute in 2007, Out-of-pocket payments accounted for 45.16 percent share of total health expenditure in our country. However for low-income people, especially in Gansu province, while their basic needs of life are difficult to met, even a small part of health expenditure is still a heavy burden for them. So there's great need to study the poverty impact of out-of-pocket payments of rural residents.This research applies the equity research method in Gansu. The research is based on the data of Gansu province household health interview survey. First of all, we measured the poverty impact of OOP on rural residents under different poverty standards, described and analyzed the changes of poverty level of rural households because of medical expenses. Secondly, we analyzed the distribution of poverty impact of different OOP components and groups with different socio-economic background under under absolute poverty standard. Compared and analyzed the difference of poverty impact between rural and urban residents. Then, compared the above-mentionde results with the relevant results in 2003, analyzed the changes and characteristics of povety impact of OOP. Finally, we analyzed the role of health financing mechanisms to povery caused bu illness, as well as the importance of health financing in poverty alleviation, and discuss in-depth on the basis of above analysis, provide data evidence and policy suggestion to Gansu health policy-makers.The result showed that in 2007 there are 5.13 percent of the rural residents of Gansu province fell into poverty because of OOP, poverty gap increased by an average of 11.29 yuan. The poverty impact of OOP on low- income people out of poverty is heavier in all group, about 32.96 percent low-income people fell back into poverty because of medical expenses. From the view of OOP composition, the poverty impact of inpatient OOP accounts for 38.6 percent of all impacts. Judging from the view of time series, although the poverty incidence dropped from 15.14 percent in 2002 to 8.21 percent in 2007, but the poverty caused by the impact of OOP has not been significantly improved, only droped from 5.71 percent to 5.13 percent. The study found that OOP is an important influencing factor to rural poverty. There exists great difference between rural and urban areas. The study also found that rapid economic development can not spontaneously resolve the poverty caused by illness, the policy intervention is necessary.