During the "14th Five-Year Plan" period, China's medical insurance reforms have unleashed sustained institutional dividends—from cross-province direct settlement of medical expenses and interprovincial mutual aid for insurance funds to faster inclusion of innovative drugs in reimbursement lists and broader access to cost-effective centralized procurement medicines. These measures have strengthened民生保障 (livelihood security) and injected certainty into pharmaceutical industry upgrades.

The primary challenge facing China's medical insurance system is maintaining fund balance amid an aging population, particularly in regions with high elderly dependency ratios where risk resilience is weaker. Enhancing pooling levels to leverage mutual insurance advantages has become urgent. Concurrently, technological and social progress demands adaptations, such as aligning employee insurance with evolving employment models beyond traditional labor relationships.

At this year's National Medical Security Work Conference, authorities emphasized deepening reforms, promoting technological innovation, and supporting healthcare and pharmaceutical development to sustain momentum for public health and economic growth during the "15th Five-Year Plan" period.

**Optimized Enrollment Structure** National data shows stable operation of medical insurance funds over five years, with coverage maintained at 95% and cumulative expenditures exceeding ¥13 trillion. Reimbursement rates for inpatient costs under employee and resident insurance remained around 80% and 70%, respectively. By end-2024, total participants reached 1.33 billion, with annual fund revenues of ¥3.49 trillion and expenditures of ¥2.98 trillion. Current-year pooling fund surpluses hit ¥463.9 billion, accumulating to ¥3.86 trillion. Including personal account balances, total reserves grew steadily to ¥4.8 trillion. Notably, employee insurance enrollment has risen proportionally, reflecting structural optimization. Recent policies encourage flexible and new-economy workers to join this more robust system.

**Provincial-Level Pooling Gains Momentum** Aging pressures are evident: retiree numbers under employee insurance surpassed 105 million in 2024, with their medical costs exceeding ¥1 trillion. Over five years, retirees grew by 3.58 million annually, driving the active-to-retiree ratio down from 2.76 (2022) to 2.63 (2024). Regional disparities persist, with some northeastern areas ratios below 1. These trends necessitate higher pooling levels to address imbalances.

Following a State Council meeting in November 2025, 20 provinces have issued policies to advance provincial pooling, a critical step to expand risk-sharing capacities and enhance governance. Most provinces adopt provincial调剂金 (adjustment funds) models rather than full fund consolidation. Authorities urge regions to optimize budget management or accelerate unified policies and operations groundwork.

**Building a Unified National Pharmaceutical Market** Aligned with national efforts to remove market barriers, the medical insurance administration has standardized key areas—reimbursement lists, drug catalogs, procurement, and service networks—to foster要素流动 (factor mobility). Achievements include: - Implementing a nationwide待遇清单 (benefits list) system for unified basic policies. - Expanding personal account mutual aid to family members, with 337 regions enabling cross-province sharing (¥100 billion utilized over five years). - Deploying a unified information platform linking 1 million+ institutions, processing 28 million daily transactions, and facilitating cross-region medical record access. - Extending跨省异地就医 (cross-province medical settlement) to cover outpatient and chronic diseases, saving patients ¥660 billion in upfront payments since 2019.

Price governance reforms include eight national drug procurement batches and four high-value consumables tenders, alongside standardized pricing rules and 36 service fee guidelines to promote new technologies.

(Original source: First Financial)