CODIFYING COMPLIANCE

When Zhang Ke, commissioner of the National Healthcare Security Administration (NHSA), unveiled China’s first unified Social Insurance Law, he called it a step toward long-term sustainability. The draft legislation currently under review seeks to consolidate fragmented rules and solidify the institutional foundations of basic medical insurance, maternity coverage, and urban-rural integration. It promises clarity on coverage, funding mechanisms, and benefit guarantees. The implications however extend beyond bureaucratic consolidation.

The law is redefining what it means to be a health citizen in Xi Jinping’s China. Health insurance reform is becoming a site where data, compliance, and entitlement converge. To be a health citizen is to be a legible subject within digital registries, algorithmic monitoring, and the norms of the Social Credit System (SCS). Health has been a political project in China as much as a medical one. Each redesign of the system has redistributed resources and redrawn the boundaries of inclusion. Who deserves care, under what conditions, and with what obligations attached?

The Foundations of Health Citizenship

The history of China’s health system has swung between inclusion and exclusion, collectivism and marketization. Each phase has altered access to care and the contours of health citizenship. In the Maoist period, health protection was collectivized through people’s communes and the Rural Cooperative Medical System (RCMS). By the late 1970s, over 90 percent of rural residents were nominally covered at a rudimentary level. Access was tied to commune membership, therefore health citizenship was collectivized but narrowly defined.

Market reforms and the dissolution of communes in the 1980s collapsed this system. Out-of-pocket payments rose to over 60 percent of national health expenditure by 2001. Healthcare once again became a family burden and a driver of rural poverty. The Hu Jintao–Wen Jiabao administration sought to repair the system. The New Rural Cooperative Medical Scheme (NRCMS) and Urban Resident Basic Medical Insurance (URBMI) rapidly expanded enrolment to over 95 percent of the population by the mid-2010s. However, as visualized by the data, public and social contributions to health financing have increased significantly since 2009, with social insurance contributions outpacing both out-of-pocket payments and government allocations by 2016. Yet the state’s fiscal input has remained modest relative to demand. Regional disparities persist in health outcomes, particularly in maternal mortality and inpatient utilization rates.

At the same time, China’s epidemiological profile shifted. There was a re-emergence of infectious disease alongside the rapid growth of non-communicable conditions. The National Basic Public Health Service Program in 2009 promised equalization through vaccination, maternal health, and chronic disease screening. However in practice, it focused on registration and monitoring over substantive and long-term care. The common thread across these phases is conditionality. In Mao’s China, access depended on commune membership; in the reform era, on local fiscal capacity and redistribution. Today, near universal enrollment coexists with inadequate protection. Health citizenship has remained administratively constructed and politically fragile. It is on this uneven foundation that the next reform is unfolding.

Codification at a Crossroads

The draft Social Insurance Law will determine whether health citizenship in China moves closer to universality. Firstly, the legislation does not resolve the structural inequities generated by the hukou system. Despite administrative consolidation, reimbursement rates under Urban and Rural Resident Basic Medical Insurance (URRBMI)  remain substantially lower than those for the  Urban Employee Basic Medical Insurance (UEBMI). Migrant workers still find their coverage fragmented across provinces. Without statutory requirements for equal minimum benefits and national pooling, geographic and class-based inequalities risk being codified into law. Sustainability is hollow if large segments of the mobile labor force remain second-class health citizens.

Secondly, sustainability cannot be equated with enrollment figures. For two decades, local governments have prioritized headline coverage rates while underfunding delivery. Rural residents are formally insured but remain exposed to catastrophic out-of-pocket spending when confronted with serious illness. If the Social Insurance Law preserves existing financing structures without linking fiscal transfers to performance, it risks entrenching bureaucratic inflation. A recalibration is needed to empower the NHSA to set national standards for benefit design, provider payment, and risk pooling, ensuring coverage translates into real security.

Third, the law must confront China’s shifting labor market. Over 200 million workers are now engaged in flexible, platform-based employment. A system designed around stable, formal wages risks excluding this rapidly expanding workforce. Flexible, earnings-based contributions and portable subsidies are necessary for equity and long-term fiscal base of the insurance funds themselves. Failing to adapt will mean that millions remain only nominally insured, reinforcing a bifurcated model of health citizenship.

These technical design questions are also constitutional. To define who is eligible, under what terms, and with what protection, is to redraw the boundaries of health citizenship. What distinguishes this phase is that such determinations are being embedded in digital architectures. Eligibility, contribution history, and benefit access are recorded in real time, cross-linked with digital ID systems, and subject to algorithmic auditing. Digital codification may close some gaps in portability and compliance, but it also enforces entitlement through surveillance. If integration with social credit systems deepens, as already piloted in several provinces, non-compliance in one domain could translate into restrictions in another including healthcare access.

Digital Governance and Algorithmic Health Citizenship

Earlier reforms constructed health citizenship through administrative enrollment and now Xi-era reforms are embedding it into digital infrastructures. The NHSA has built one of the world’s most extensive real-time claims monitoring systems, linking hospitals, pharmacies, and insurance registries across provinces. This enables portability, but only for those who are digitally legible. Every transaction is subject to algorithmic auditing and reimbursement is contingent on compliance with contribution records, approved providers, and verified patient identity. Migrants lacking standardized digital registration, gig workers, or patients seeking cross-provincial care often face delays or denial. The promise of universality thus depends on continuous visibility within the system. In Suining County, Jiangsu for example, local authorities experimented with linking social credit points to healthcare benefits. Residents who violated traffic laws or family planning rules could see their access to subsidies reduced. Localized pilots illustrate how digital insurance registries, credit scores, and disciplinary mechanisms can be fused into a compliance regime. Health citizenship becomes behavioral conformity across domains in the ‘new era’.

Digital codification also alters the balance of power between state, citizen, and provider. Local governments can now be monitored through automated reporting, while providers face real-time scrutiny of claims. This same apparatus also positions patients as potential defaulters who are then subject to constant verification. The line between healthcare as protection and healthcare as surveillance is increasingly blurred. China’s experience shows that digital integration can close some gaps in coverage, particularly for mobile populations but it also recasts universal health care as contingent upon compliance.

In practice, this often intersects with the broader logics of the Social Credit System. Through “red lists” for compliant citizens and “black lists” for those deemed untrustworthy, welfare is increasingly linked with mechanisms of discipline. The pandemic already demonstrated how quickly health records, travel permissions, and behavioral scoring could be fused into a single regime of governance. The redefinition of what it means to be a health citizen in China is to qualify for protection while simultaneously being enrolled in a system that rewards conformity and penalizes deviation. Insurance, a buffer against risk now doubles as an instrument of surveillance. This is the paradox of Xi-era health reform. Expansion of protection has come alongside expansion of control and universality has been pursued through visibility.

Photo Credit: The New York Times