Decoupling of Elderly Healthcare Demand and Expenditure in China

Abstract

This study examined the changing trajectory and factors that influenced the health and medical expenditure of the Chinese elderly population over the past two decades. Based on the Chinese Longitudinal Healthy Longevity Survey (CLHLS) from 1998 to 2018, inferential and multiple linear regression models were constructed. The key finding is that China has experienced a decoupling of healthcare demand (HCD) and healthcare expenditure (HCE) since around 2014, when HCE began to decline despite the fact that HCD continued to rise. This is a promising sign, suggesting that the government’s health insurance policy is working. Furthermore, participating in health insurance schemes can significantly reduce the elderly’s HCD and HCE, demonstrating that health insurance can effectively affect the elderly’s decision to seek medical treatment and improve their health condition. We also found that age, region, basic old-age insurance, and care by the government and institutions were significant factors that influenced the healthcare demand and expenditure of the elderly population.