Can Social Health Insurance Improve Mental Health? An Analysis of Supplementary High-Cost Illness Insurance in China

China introduced an innovative Supplementary High-Cost Illness Insurance (SHCII) program to enhance existing social health insurance by providing extra financial support for individuals facing catastrophic illnesses in 2015. The SHCII has notably increased access to healthcare and alleviated financial strain for economically disadvantaged individuals. However, there is a lack of information regarding the program's impact on the mental health of its beneficiaries. This study aims to assess the impact of SHCII on the mental well-being of middle-aged and older individuals.

Using data from the China Health and Retirement Longitudinal Study (2011, 2013, 2015, and 2018), this study examined how SHCII affects mental health among middle-aged and older individuals in China using propensity score matching with the time-varying difference-in-differences method.

We found that SHCII implementation can significantly reduce the Center for Epidemiologic Studies-Depression Scale scores of middle-aged and older individuals. This reduction was more pronounced among older individuals with poor self-rated health, chronic disease, and low household wealth when compared to their counterparts.

The implementation of SHCII has had a significant and positive impact on mental health outcomes. We recommend that governments consider expanding the program to other areas within China, focusing especially on the most economically disadvantaged segments of the population.