| 1 BackgroundChina is entering a new era in which the flourish of economy and the deterioration of people's health status coexist. People are confronted with many prominent obstacles in the medical care field such as inconvenient access to health care and expensive health expenditure. Consequently the problems resulted from the doctors and hospitals as well as medicines are noting less significant than the issues of Agriculture Rural Area and Peasants. The health care field is faced with series of inevitable challenges and unsolved difficulties.Proper balance of demand and supply in the medical care is needed in order to operate the medical care system in a more efficient way. For a long time, development in the medical care in China has been focusing on the supply alone and the equilibrium of demand and supply mainly depends on the expansion of the supply. As the derived demand of health demand for people, medical care comes from the pursuit of health status from all classes of the society. Both the government and the society are allowed to invest in this field, but the effects of the medical care rely on people's response to and need for it. Only when we aim at those actions and social economic factors that influence the demand of health and medical care, can we establish some practicable and feasible health policies.For a long time, medical care has always fixating on the level of clinical treatment, which, however, did not bring practical changes to the health status of the citizens. Even though medical care shifted gradually to economic level, it is still viewed as a supplementary tool for the production of human resources. This narrow and limited concept neglected the function of medical care itself to stabilize the society, to promote social justice, and to maintain the harmony of the society, which needs to be reestablished undoubtedly.The complexity and historical reasons for the medical care system and medical care model resulted in the inconsistency and self-contradiction of different health policies. In this sense we conclude that the reform in the medical care system is in fact a political procedure.If we can not realize the real value of medical care, we won't be able to understand even the simplest technological problems. Therefore, only if we understand the purpose and function of medical care in a profound way and take some actions basedon these understanding, can we design a more effective and efficient reform program. Few systematic theoretical analyses and large scale positive analysis are seen in this field. The international community tends to pay more and more attention to the research on the health status of the citizens as well as medical care demand and utilization. The United States, The United Kingdom and Canada, etc, have already conducted large scale survey and research in this field. Under different social, economic and cultural backgrounds, especially during the social economic shifting period, what personal, family, social, economic and environmental factors influence the demand of health status and medical care, how they influence it, and what are their internal mechanisms? We lack a series of systematic researches such as on how to improve people's access to medical care, how to allocate medical resources in a reasonable way and reduce the burden of medical expenditure of the citizens, how to establish a medical care model that fits in with the social and economic development, and how to promote sustainable development of the medical care model. For a big country like China that has an imbalanced economic development with typical 2D structure (two extremes in the allocation of wealth between the rich and the poor), surveys alone on health status are inadequate. Based on theoretical analysis, it is quite necessary for us to conduct positive analysis and policy situation analysis on the medical needs and demands of the citizens from an economic perspective, with the hope to establish a systematic and scientific recognition and judgment of the current situation, problems existing and contradictions confronted in the medical care reform model. Therefore, this research has important practical significance as well as theoretical values. 2. Objective and specific goals:2.1.Objective: Under the general background that China is shifting from planned economy to market economy, the population structure and disease models are changing, and the medical care model reform is being undertaken, we wish to establish a theoretical analysis and positive analysis framework of the characteristics and influencing factors for the demands in medical care model, and to find out about its tendency, in order to systematically analyze the present problems and contradictions in the current medical care model and to form an overall and scientific judgment of the current situation, problems existing and contradictions confronted in the medical care reform model. Finally we hope to put forward reasonable suggestions on policy making aiming at the reform and development of medical caremodel in China.2.2. Specific goals: (T).To theoretically elucidate the concept of health capital, health production function and model, and to make clear the relationship between the demands of health status and medical care, as well as the characteristics of medical care markets. ?.Through positive analysis and making use of the panel data, we hope to find out what personal, family, social, economic and environmental factors influence the demands of health status and medical care, how they influence it, and what are their internal mechanisms in this special period? (D.By positive analysis and four-part model, we tried to list the influencing factors for both medical care utility (outpatient and inpatient) and medical expenditure (outpatient and inpatient), and analyzed the behaviors and characteristics of medical care utility of the citizens. ?. Time-series data were used to analyze the trend and characteristics of the demands of health status and medical care utility, and the economic condition and medical expenditure changes in the past 10 years. ?.Based on the theoretical analysis and positive analysis, policy situation analysis was carried out to form a systematic and scientific judgment of the current situation, problems existing and contradictions confronted in the medical care reform model, and to put forward reasonable suggestions on policy making aiming at the reform and development of medical care model in China. 3. Data and Methods3.1 Data: The positive analysis resources are originally from the data of the Third National Health cares Survey which was carried through in October of 2003, in HUNAN, as well as from that of the two prevenient National Health cares Survey, which are compromised by four different types of resources: (D Time-series data; (2) Cross-section data; (3) Longitudinal data; ? Pooling data;? Panel data.3.2 Methods: Five main research methods have been implemented in the project, which are Theory Analysis, Literature Review, Positive Analysis, Statistic Analysis, and Policy Situation Analysis. During the process of positive analysis, we adopted Supply and Demand analysis, Four-part model which was combined with the model of outpatients and the model of inpatients, as well as the Statistic Analysis which included statistic description, ^2test, logistic regression, and loginear regression; while as we interconnectedly introduced quantitive and qualitative analysis in the course of scenario analysis. All the establishment and analysis of the database wasdone by SPSS 11.0. 4. Consequence:4.1. New idea of Health and medical care. Health is part of the foundation of human capital, which decides the practicable time in the market or out of the market, while it is also the representation of the human productivity; medical care is the movement to improve health status or to recuperate. The process of transferring medical care to health results is a kind of production function, while the medical care is the devotion element for the consumers to produce health, as well as the derived demand of the consumers' health demand. The following are the main characters of medical care market—uncertainty, interposition of health insurance, information asymmetry, external effect, intervention of government, quasi-market competition, limitation of price system, the role of non-profit medical care institutes, etc.4.2. The health status of the residents. The proportion of over 65 years old people is 10.67% in the survey area, which means the access to epoch of oldness; Two-week morbidity rate computed by person-time in the year of 2003 is 133.24%, which has ascended 2.78%o according to the year of 1993 and 4.03%o according to the year of 1998; morbidity rate of chronic diseases in the year of 2003 is 159.36%o, which has dropped 24.94%o comparing to the year of 1993 and 7.69%o comparing to the year of 1998, with the characteristic of decline in cities and rise in countryside.4.3.The 2D structure of health status of the residents and the distribution of disease spectrum. The two-week morbidity rate of urban population in 2003 is 200.12%o, while that of the rural population is 113.54%o; the morbidity rate of chronic diseases of urban population in 2003 is 275.63%o, while that of the rural population is4.4. Utilization of medical care of the residents. Two-week visit rate of the survey area in the year of 2003 is 54.89%o, there into 42.36%o in urban area while 58.58%o in rural area, which has descended from 226.50%o—the two-week visit rate in the year of 1993. The proportion of consultation rate in different levels of medical care institutes among the two-week visit is 41.2%, while that of the urban area is 21.2% and 51.6% of rural area. The self-medication rate has increased from 23.12% in the year of 1998 to 49.62% in the year of 2003. The hospitalization rate in the year of 2003 is 37.57%o, with that of the urban area is 44.20%o and 35.61%o of the rural area, nevertheless, the hospitalization rate of the urban area has come down from 46.15%o in 1993 to 35.93%o in 1998. The rate of non-hospitalization has dropped from 46.15%in 1993 to 35.93% in 1998, and has been keeping on falling until 33.58% in 2003.4.5. The influencing factors of the health status. Based on the results of logistic regression model, we can find that the principle influencing factors for two-week morbidity rate in the general survey area are—in turn—chronic disease, the distribution of urban population and rural population, employment status, family revenues, and access of health care(time), while those in the urban area are—in turn-—chronic disease, education, and four factors in turn—chronic disease, family revenue, access of health care(time), age—in the rural area. The main influencing factors for morbidity rate of chronic diseases of the survey area are sex, age, employment and type of drinking water supply, while those of the urban area is age, and for the urban area are sex, age, type of drinking water supply and family revenues.4.6. Medical care expenditures have been rising rapidly. Compared to that of 1998, the per capita annual disposable income of urban household has increased 48.67%, meanwhile, the expenditure for consumption has augmented 42.17%, moreover the expenditure of health care and medicament has risen 85.37%; as the net-revenue of rural residents has been dropping, their expenditure for consumption has increased respectively 9.78%, 22.67%, 10%, while that of health care and medicament has gone up to 10.66%, 8.93% and 10.81%. At the year of 2003, the expenditure consumed per two-week visit in the survey area is $426.89, while that of urban population is $786.68 and $415.76 of rural population; the indirect costs per visit for the general survey area is $17.49, while that of urban residents if $35.36 and $17.11 of rural residents. The expenditure per hospitalization in the whole survey area at the year of 2003 is $3200.74, while $6176.39 for the urban area and $2153.37 for the rural area. After controlling the inflation factors, the expenditure consumed per two-week visit for urban population has gone up from $19 in 1993 to $54 in 1998, and has been keeping on increasing to 350 until the year of 2003, while the expenditure consumed per hospitalization for urban residents has dropped from $6306 in 1998 to $6176 in 2003, but that of the rural residents has ascended. The general rate of two-week non-visit caused by financial difficulty has improved from 41.27% in 1998 to 47.13% in 2003, with the increase of 109.1% for urban residents as well as the apparent augmentation for the rural residents. The general rate of non-hospitalization caused by financial difficulty has also ascended from 68.63% of 1993 to 83.61% of2003, which has increased 21.82%, while the rate of urban area has augmented 371.33%.4.7. The influencing factors of utilization of medical care. From the results of four-part model we can find that the most essential factors of two-week visit are the severity level of disease, education of patients, employment and the geographic location of resident. The main influencing factors of two-week visit of patients aged more than 15 years-old are self feeling of health status, chronic disease, the distance to the nearest health sector, age, education, and the geographic location of resident. Regarding the logistic regression model, the most crucial influencing factors of the medical expenditure per visit are chronic disease, the severity level of disease, the duration of disease, as well as the level of medical care sector, besides, Engel's coefficient, education, marriage have also affected the expenditure per visit at a certain extent. The main influencing factors of medical care expenditure of per treatment are the severity level of disease, the duration of disease and the means of treatment, furthermore, the reside area of patient and status of employment have also a certain level effect ion. The essential influencing factors of hospitalization are the self feeling of health status of the patient, sex, age, marriage, while those of the consumed expenditure per hospitalized case are the means of treatment(with or without operation), the duration of hospitalization, the level of medical care sector, as well as the family revenue, Engel's coefficient also have affected more or less.4.8. The traditional medical care model can not accommodate the development of resident's health status and the social economy. In 2003, 78.8% of the urban patients and 48.4% of the rural patients did not consult in any level of health sector. The main health sectors taken over two-week visit are concentrated in the city level and province level hospitals in the urban area, while in the rural area are concentrated in village clinics and township health centre. Nearly half of the patients (49.62%) have taken self treatment, while the proportion in the urban area is 76.77%. The two-week non-visit rate has increased from 32.22% in 1993 to 41.66% in 1998 and kept on gone up until 58.81% in 2003, while the self-treatment rate has ascended from 23.12% in 1998 to 49.62% in 2003. 34.20% of the hospitalization patients have leaven hospital at the status cured, while 57.62% that are uncured left the hospital as their own request. Those that should had been in hospital but haven't account for 31.30%, 83.61% from that is because of financial difficulty, while 78.5% in urban area and 84.23%. 84.72% of the hospitals taken hospitalization in urban area are citylevel hospitals and province level hospitals, while 56% of those are township health centre in rural area. The average duration of hospitalization has been dropping since 1993, but the waiting time for hospitalization has been increasing, while the rate of operation treatment during hospitalization has also been going up.5. Conclusion:Health is part of the foundation of human capital, medical care is the movement to improve health status or to recuperate. The process of transferring medical care to health results is a kind of production function, while the medical care is the devotion element for the consumers to produce health, as well as the derived demand of the consumers' health demand; The un-concord between health status and disease mode caused by the development of rural-urban dual structure; The un-concord between the supply and demand of health care because the development of traditional health care system and mode is dropped behind the advancement of health care demand; The un-concord between advancement of health demand and descendant of health care utilization; The un-concord between government failure as well as market failure and the high expectation of the public.6. SuggestionsWe must build a notion that health is the capital of fortune, during the medical care systems reform, while setting the investment for health as one of the most important strategic target of social economic development. Meanwhile we must realize that better service for the improvement of people's health and development of the social productivity are the two mains objectives of the medical care system reform, which should progress harmoniously and corporately during the reforms. While with the compliance of effectiveness, suitability, access, justice, equality and efficiency as the principles of reform, we should transfer it from empirical to rational. The payment system is the essential problem of the medical care reform. While basing on the community primary health care, we should also build multi-level medical care system. We should recognize the relationship between government and market, and establish the effective competition system as well as reasonable encourage mechanism in order to promote productivity. As the derived demand, the supply of medical care should be multiplied. Medical care is the most suitable modulator for the social justice.
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