Analysis On New Rural Cooperative Medical Care System And Its Effects In China

China's rural cooperative medical care system was established in the middle of 20th century. It developed quite well until eighties. Because lack of medical security system and high prices of health services, most farmers turned or returned to poverty due to illness. This will affect our well-off society-building in an all-round way. In 2003, the State Council forwarded"Guidance of the establishment of new rural cooperative medical system which was issued by joint of Health Ministry, Finance Ministry and Agriculture Ministry. It stressed government should lead and organize farmers to establish"serious illness oriented"new rural cooperative medical care system. From 2003 to 2010, new rural cooperative medical care system has been running smoothly and now covers most farmers in China. So, this article tests effect that new rural cooperative medical care system has on farmers'health and income.Based on theories of health and public goods, this article researches effect new rural cooperative medical care policy has on farmers'income and health from the perspective of rural health. By measuring inequality of health level, the author compares rural health of different provinces, and examines status and mechanism of new rural cooperative medical system. Besides, the author studies effects new rural cooperative medical care system can have on health level and income.The first part of this paper introduces questions researched and analyzes significance, structure and research methods. The second part is literature review, which sums up relevant theories and concepts. The third part introduces rural health level and its relationship with farmers'income. Further more, the author analyzes differences of China rural health and factors which influence rural health. In the next, the author researches historical evolution and mechanisms of new rural cooperative medical care system in China, analyzes its features, effects and problems existed so far. In empirical study, the author examines effects of new rural cooperative medical care system using Tobit model. The results show that new rural cooperative medical care system has positive effects on both rural health and income. Owing to different economy conditions, effects of the new rural cooperative medical care system are different among provinces. The last part concludes results of empirical study and makes some possible suggestions.