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  • Print publication year: 2015
  • Online publication date: May 2018

China

Summary

Background

China is perhaps the most impressive economic development story in modern history. Sustaining annual growth rates upwards of 9 percent for more than two decades, the country's gross domestic product (GDP) reached US$8 trillion in 2012 (second only to the United States at US$16 trillion). This remarkable expansion has lifted hundreds of millions of Chinese out of poverty and created a new middle class that is larger than the entire US population.

With more than 1.35 billion people, China has the largest citizenry in the world. In 2011, the country's urban population surpassed its rural population for the first time, with close to 700 million people living in China's cities. Population growth in China has decreased steadily over the last 20 years due to the controversial one-child policy (from approximately 1.2 percent to less than half of one percent) and is expected to continue to decline. The country's median age is just 35 years, compared to nearly 40 years in more developed countries. However, as a whole, the population is aging rapidly; senior citizens will account for as much as 35 percent of the Chinese people by 2053.

One of the most important challenges facing China in the twenty-first century is how to allocate healthcare resources for its massive population. Despite progress in the country's economic transformation, China significantly lags the developed world in its ability to provide even basic health services to the vast majority of its people. The Chinese government spent approximately 5 percent of GDP on healthcare in 2011, compared to roughly 18 percent spent in the US and 9 percent on average in the OECD countries. Per capita spending on medical technologies is just US$ in China versus US$399 in the US.

China's centrally planned economy provides health insurance coverage to approximately 90 percent of the population under three primary programs (an employer-based system, one for urban residents, and another covering the rural population). These insurance schemes are largely inadequate to cover basic care but rather focus on protecting patients from catastrophic health events. As a result, the Chinese typically pay for basic health services out-of-pocket, causing many individuals to delay diagnosis and treatment until they are critically ill.