Urban Social Health Insurance Personal Accounts Function Analysis

Since 1990s, the economic system has transformed from planned economy to market economy, so the free medical system and free labor medical system dated from 1950s have faced dilemma of development and challenges of transformation, hence the Chinese government began to explore to build up the system of medical insurance for workers in cities and towns. In 1998, the State Council issued "The Decision of the State Council on Setting up Basic Medical Insurance System for Staff Members and Workers in Cities and Towns" (State Made (1998) 44), in which formulated that an overall raising of basic medical insurance funds and individual accounts would be established. Until now, the form of "overall raising of funds and individual accounts" of the state social medical insurance for workers in cities and towns has been formally established.The "overall raising of funds and individual accounts" of the state social medical insurance for workers in cities and towns is a new financial module of the state social medical insurance for workers in cities and towns after reformation, besides, whether the individual accounts can perform well or not is an important index for evaluating whether the new system is successful or not among academia. At the beginning of establishing individual accounts of social medical insurance for workers in cities and towns, it has aroused general concern among academia. Afterwards, when the individual accounts start its operation, the exposing of some disadvantages causes academia's discussion on whether individual accounts should be retained or abolished, and what its functions are. Nevertheless, at the present stage, the state has to carry out the module of combining social overall raising of funds and individual accounts, so when some experience has been accumulated after the practice of the state medical insurance reform, we could objectively re-exam the individual accounts of social medical insurance for workers in cities and towns. Furthermore, we could analyze its function localization and value recreation, so as to make it play a more important role, to improve its use ratio, and to promote the sustainable development of social medical insurance for workers in cities and towns.The paper starts with related economic theories and makes use of certain analytical methods in research to analyze the present condition of the individual accounts of social medical insurance for workers in cities and towns. Afterwards, its functional deficiencies will be summarized, and then the causes will be analyzed. Meanwhile, the domestic and abroad individual accounts of social medical insurance will be sorted out and examined, including the overall raising method of payment in new-typed rural cooperative medical clinics and the individual accounts module of social medical insurance in Singapore. According to learning on their experience, the paper proposes to build a overall raising module for community clinics of individual accounts of social medical insurance, by which individual accounts and community medical service can be combined, consequently, the use ratio of individual ratio will be improved. In addition, based on the present operation of individual accounts, its functional extension will be explored, which aims at putting forward some policies and suggestions for the sustainable development of individual development of social medical insurance for workers in cities and towns.