Strengthening financial protection through multitiered health coverage: evidence from 667 055 low-income households...

Low-income households face disproportionate out-of-pocket hardship when accessing healthcare, undermining equity and universal health coverage. To address these challenges, China implemented a three-tiered health coverage system-basic medical insurance, catastrophic medical insurance and medical assistance-but its comprehensive impact on the financial protection remains underexplored.

We analysed Shaanxi Province's Medical Assistance database (2013-2016) to evaluate the impact of China's multitiered health coverage system on financial protection by: (1) estimating the incidence of catastrophic health expenditure (out-of-pocket payments> 25% of annual income) and medical impoverishment (postpayment income

A total of 667 055 households were included. After reimbursement, the incidence of catastrophic health expenditure fell from 58.59% (95% CI: 58.47 to 58.70) to 17.89% (95% CI: 17.79 to 17.97) and medical impoverishment from 41.43% (95% CI: 41.30 to 41.54) to 13.47% (95% CI: 13.38 to 13.55), driven mainly by basic medical insurance and medical assistance. Rural households received larger absolute declines yet remained higher than urban counterparts. Financial protection inequity worsened: the Horizontal Inequity Index for catastrophic health expenditure shifted from -0.0890 (95% CI: -0.0902 to -0.0879) to -0.1717 (95% CI: -0.1746 to -0.1689) and for medical impoverishment from -0.2653 (95% CI: -0.2669 to -0.2640) to -0.5251 (95% CI: -0.5280 to -0.5222), a pattern observed in both urban and rural areas.

Our findings underscore the need for a three‑tiered health coverage system-including targeted, equitable reimbursement-to advance universal health coverage. Emerging tools such as big data analytics and artificial intelligence offer new ways to monitor and optimise equity; it is timely to extend equity considerations beyond funding mobilisation to reimbursement.