Conflict Alerts # 590, 16 February 2023
In the news
On 15 February, videos and photos of a protest in Wuhan went viral after hundreds of pensioners protested against changes to the health benefits of the elderly. China’s social media users shared glimpses of civilians protesting, chanting slogans and singing songs outside Zhongshan Park despite the police presence. Another protest was recorded in Guangzhou and Dalian after the elderly noticed significantly lower balances in their bank accounts, hinting at a cut to their medical benefits. The authorities explained that the changes to the public health insurance system may vary in different regions but it aims to bring more services under the system while cutting down on individual subsidies.
Issues at large
First, the change in the public health insurance system. In September 2021, the State Council adopted the 14 th Five-Year Plan for National Medical Security. The Communist Party of China (CPC) aimed at improving the medical insurance system to include more people under its medical services and drugs. The insurance is the largest in the world; increasing its coverage from 1.36 billion people (13 th Five-Year Plan: 2016-2020) to the entire Chinese population of 1.42 billion (2021). During the executive meeting in 2021, Premier Li promoted the new plan by highlighting its capability to make medical services more accessible and affordable.
Second, the challenges to the new medical insurance system. In Wuhan, the authorities introduced reforms to transfer capital from the mandatory health savings plan to an outpatient insurance fund managed by the state. The reforms were enforced from 1 February and led to the first protest on the issue on 8 February. The reforms were introduced to reduce the burden on the state’s healthcare plan which suffered substantially during the COVID-19 pandemic. Even though the health insurance fund witnessed a fivefold increase in 2021, it has been struggling and had to dip into people’s personal spending accounts and mandatory savings accounts. The surge in accounts resulted in temporary relief as the authorities could shift the capital from the younger users to the elderly who spent more on medical expenses. However, with the new reform, the government can use the capital to fund the medical expenses of everyone, regardless of their bank balance. China is also dealing with a quickly ageing population which is expected to further increase the strain on the insurance system. This is a cause of concern for the able-bodied younger generation who will have borne the brunt of the insurance system.
Third, the shifting nature of protests in China. In the months after the withdrawal of the zero-COVID policy of the CPC, there have been numerous protests on a wide variety of issues such as fireworks ban, the crumbling property sector, delay in wages, unfair dismissal at the workplace, and more. These protests are viewed in China as the ones which were able to produce a positive outcome from the authorities.
After the withdrawal of the strict COVID restrictions due to the mass public unrest and protests, there is a change in the nature of China’s social behaviour wherein the people are hopeful of bringing change through public displays of dissatisfaction and frustration. However, it is unclear if all future protests will result in a similar positive outcome as the withdrawal of the zero-COVID policy did.
The increasing number of protests and mass unrests also pose a challenge to President Xi Jinping’s third term as the leader of the country and the CPC. The protests against the health insurance system therefore come at a crucial time for the CPC and Xi Jinping. Thus, there is a higher possibility for the protests to be crushed by the authorities.
Lastly, the strain on the healthcare system is a serious challenge for the CPC and is bound to hold a larger presence in China’s politics and social structure in the future due to the increasing number of elderly population in the country. The declining birth rate further adds to the problem.