China’s Health Insurance System Under Strain as Millions Opt Out
Shanghai – China’s voluntary health insurance programme for urban and rural residents is witnessing a steep decline in enrolment, raising concerns over the long-term sustainability of the country’s public healthcare system. Official data released by the National Healthcare Security Administration (NHSA) shows that 15.8 million fewer people enrolled in the scheme in 2024 compared to 2023.
The programme—designed primarily for farmers, unemployed individuals, and non-salaried groups—forms a key part of China’s broader basic medical insurance system, which also includes a separate scheme for urban employees. In total, the basic insurance system covered 1.326 billion people in 2024, marking a net decline of 7.27 million from 2023.
Experts point to a mix of economic pressures and growing public skepticism as the primary drivers of this trend. Rising insurance premiums—set at 400 yuan (approximately USD 56) per person in 2024—and limited income growth in rural areas have made participation increasingly burdensome for low-income families. The government contributes an additional 670 yuan per enrollee, bringing the annual per-person funding to 1,070 yuan. However, individual contributions rose by 5 percent last year, adding further strain.
Beyond affordability, declining trust in the health system has emerged as a significant factor. Despite contributing regularly, many participants feel the scheme provides inadequate support for actual medical expenses. As healthcare costs continue to climb, the value proposition of the insurance system is being questioned.
The NHSA maintained that overall coverage remains above 95 percent, although it did not provide a direct year-on-year comparison. In contrast, China’s total population declined by just 1.39 million in 2024, underscoring that the drop in insurance enrolment is not solely due to demographic changes.
Adding to the pressure is the growing gap in the system’s fund pool. While total income rose to 2.373 trillion yuan (USD 330 billion)—a 3.5 percent increase from 2023—expenditures surged by 7.6 percent, reaching 1.910 trillion yuan, signalling a widening fiscal imbalance.
In 2023, the NHSA had dismissed a wave of cancellations as a minor fluctuation, attributing it to technical upgrades and administrative adjustments. However, the continued decline in 2024 suggests more systemic issues are at play.