Rural Health Care in Vietnam and China: Conflict between Market Reforms and Social Need

Abstract

China and Vietnam have adopted market reforms in the health sector in the context of market economic reforms. Vietnam has developed a large private health sector, while in China commercialization has occurred mainly in the formal public sector, where user fees are now the main source of facility finance. As a result, the integrity of China's planned health service has been disrupted, especially in poor rural areas. In Vietnam the government has been an important financer of public health facilities and the pre-reform health service is largely intact, although user fees finance an increasing share of facility expenditure. Over-servicing of patients to generate revenue occurs in both countries, but more seriously in China. In both countries government health expenditure has declined as a share of total health expenditure and total government expenditure, while out-of-pocket health spending has become the main form of health finance. This has particularly affected the rural poor, deterring them from accessing health care. Assistance for the poor to meet public-sector user fees is more beneficial and widespread in Vietnam than China. China is now criticizing the degree of commercialization of its health system and considers its health reforms “basically unsuccessful.” Market reforms that stimulate growth in the economy are not appropriate to reform of social sectors such as health.