Research On China's Medical Reform In The Perspective Of Public Finance

In the framework of public finance, financial expenditures is an important tool for government functions. In the functions of government, the allocation of resources and the distribution of income are topping the list. China's medical and health reform is essentially a re-allocation of health resources. In the foreign coutry, there are two means of health resource allocation. One is market allocation, the other is adjustment by the government. The former is mainly based on the needs of the market (such as the United States),while the latter mainly through the management of government (such as the United Kingdom).However, this two configurations are not satisfactory. Because there are a lot of market failure phenomena in medical and health services market environment. It is not to be expected to rely on the market mechanism to correct inefficient allocation of state resources to achieve Pareto optimal. But, The government can correct this through fiscal policy and administrative measures. Therefore, the market mechanism and the government's macro-regulation must be used at the same time in order to achieve the optimal allocation of health resources, to achieve economic efficiently.This paper is just at the perspective of public finance to study China's medical and health reform ,so as to analyze the problems of China's medical and health reform and give the advices to solve them by using the theory of public finance (such as the theory of public goods, market failure theory, fair and efficiency theory).Specifically, this paper is divided into four parts. The first part is a brief description of China's medical reform and an adjustment of success or failure of China's health care reform. At present, some gaps are remarkable in total health expenditure, public health payout and per health payout in our country compared with the average level of the whole world. From the view of fairness, China's health fair in the world ranks behind, from the view of efficiency, the use of health resources is inefficient. In short, China's medical reform is not very successful, "the difficulties and expensive price is still the current outstanding problems".The second part is divided into several parts which include the theory of government intervention in specific areas of health and the effect of government intervention and so on. In the field of health care theoretical basis of intervention, this paper analyzes the theory of market failure and public goods. The perspective of market failure derives the need for medical intervention, the perspective of public goods derives the government input of the health and medical field. In short, the government health sector should assume corresponding responsibilities.The third part is a brief introduction of the other countries, so as to summarize the proper establishment of our country's health care system by analyzing the advantages and disadvantages of the different medical models. Specifically, according to the roles of government and private in the health system, there are four main modes in the world health system: First, the integrated monopoly(on behalf of the United Kingdom);Second, the market-oriented(representatives of the United States); third, public contract type (represented Germany); Fourth, it is complementary balanced public- private type (Singapore representative).Although, there are above four medical models in the study, any health model can be said to be perfect. All the medical model options are in the balance of three aspects "cost, quality, accessibility ".In this trade-off between the choices, one or another problem exists, and the problem must be reformed. Above four medical and health systems have a common mode of the development trend, that is they are trying to effectively integrate the "visible hand" and the "invisible hand" so as to reduce health expenses and satisfy the public demand by the government's macro-economic regulation and market mechanisms combined more effectively. This paper is based on the government's perspective to give financial and policy support.The fourth part is the end of the paper. In this part, I try to give proposals of medical reform, in the way of clearing the different responsibilities of levels of governments and controlling the size and structure of financial expenditure for health. Specifically, before the burdening the responsibility, the government and the market should be accurately determined the border to prevent the appearance of "offside", "absence" and "wrong". In the accuracy of the government and the market borders, the government should give strong support for public health care services and adjust the structure of expenditures. First, adjust the financial health expenditure and structures. Second, distribute the expenditure between urban and rural areas fairly. Third, intensify the central and western areas, especially the poverty-stricken areas in the geographical distribution of health expenditure. In addition, the government should supply subsidies from both supply and demand factors. Finally, to further improve our health system of transfer payments, the transfer payments should be designed to give the support to China's medical reform by a lateral transfer payment mainly and a crisscross financial transfer payment auxiliary.