The efficiency of provincial government health care expenditure after China’s new health care reform

Abstract

Objective We aim to estimate the total factor productivity and analyze factors related to the Chinese government’s health care expenditure in each of its provinces after its implementation of new health care reform in the period after 2009. Materials and methods We use the Malmquist DEA model to measure efficiency and apply the Tobit regression to explore factors that influence the efficiency of government health care expenditure. Data are taken from the China statistics yearbook (2004–2020). Results We find that the average TFP of China’s 31 provincial health care expenditure was lower than 1 in the period 2009–2019. We note that the average TFP was much higher after new health care reform was implemented, and note this in the eastern, central and western regions. But per capita GDP, population density and new health care reform implementation are found to have a statistically significant impact on the technical efficiency of the provincial government’s health care expenditure (P<0.05); meanwhile, region, education, urbanization and per capita provincial government health care expenditure are not found to have a statistically significant impact. Conclusion Although the implementation of the new medical reform has improved the efficiency of the government’s health expenditure, it is remains low in 31 provinces in China. In addition, the government should consider per capita GDP, population density and other factors when coordinating the allocation of health care input. Significance This study systematically analyzes the efficiency and influencing factors of the Chinese government’s health expenditure after it introduced new health care reforms. The results show that China’s new medical reform will help to improve the government’s health expenditure. The Chinese government can continue to adhere to the new medical reform policy, and should pay attention to demographic and economic factors when implementing the policy.