China Medical Security System: Path Dependence And Transcendence

For a country & society, a good medical security system provides basic safeguard for people's normal living, and a healthy status of all people plays an important role in society stabilization & economy development. Therefore, medical security system is becoming a main aspect of "Harmonious Society", which has very close relationship to people's living & country's development.In 1950s, China established a medical security system under planned economy which covered urban and rural area. But impacted by the policy of industrialization and modernization, the medical resource and benefit were mainly distributed to urban area while rural area did not get enough government attention. At present, China medical security system has become a binary partition between urban and rural area. The binary partition medical security system causes many social problems, such as medical resource not distributed and balanced between urban and rural area, the medical expense gap between urban and rural people increasing, the health indicator of rural people becoming worse and worse than urban people. All these problems are impacting China society stabilization and economy development.First, this essay reviews the history of institutional transition of China medical security system. Second, it applies the path dependency method of institutional economics to study the institutional transition, and analyzes the factors which result in such institutional transition from 4 aspects, which are economy structure, formal regulation and rules, informal regulation and rules, vested interest group. Third, it highlights the problem under such binary partition medical security system. Finally, it proposes some improvement suggestion to integrate such urban-rural binary partition medical security system.