Insurance news from China shows funds facing strain

china insurance industry

insurance news chinaThe aging population in the country is starting to make medical coverage more expensive.

The latest insurance news out of China has shown that the health coverage fund in Beijing is starting to experience considerable pressure as the population ages.

People are living longer, which means that chronic diseases and medical care needs are growing.

The older the population gets, the higher the frequency of chronic diseases. These are increasing the demand for medical services in the city, which means that Beijing’s insurance news is growing in its expenses. According to the Tongren Hospital health insurance office director, Zhang Qingyu, “It is a fact that medical expenses have been increasing along with the economic growth. In fact, the demand on medical services may be limitless.”

Tongren is only one of many hospitals releasing this type of insurance news as they operate within a city budget.

The reason that Tongren Hospital and thirty three others within Beijing are concerned about this insurance news is that they are currently functioning on a budget that is established by the city’s health coverage fund. This, according to a Beijing Municipal Bureau of Human Resources and Social Security official.

The city’s program was only just started in July 2011. It began with four large public hospitals, which received fixed city health fund grants. They included the Friendship, Tongren, Chao-yang, and Jishuitan hospitals. Until that time, the fund provided coverage for all refundable health services that the hospitals provided. This was provided no matter the size of the total cost. However, the city’s budget for this fund is now requiring hospitals to pay if the exceed the prescribed amount, which makes it vital for cost control efforts to be effectively applied.

The official, who declined to be named for the insurance news information, said that if the hospitals are not capable of keeping their costs within budget, “they will need to pay 8 percent of the deficit.” This has caused those medical institutions to have to introduce far stricter measures on the prescribed therapies and treatments in order to carefully control the costs that they will generate.

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