According to a recent article in The New York Times, medical costs in China are rising by 35% a year.¹ In rural areas, at the same time as health care costs are rising, prices for farm products (grain, meat and vegetables) are falling. Although the public health system is trying to revive them, village health cooperatives have largely dissolved. For many farm households currently living on the margins of China's developing society, one major health problem can devastate the entire family. Either health care costs are too much for the family to bear, so they borrow money which they are never able to pay back; or a major breadwinner in the family is set back by a health problem so that the family's main source of income is lost.

A study of families living in poverty in China showed that 49% of them fell into poverty because of illness in the family.² In a 1994 survey of three poor rural counties it was found that average expenditures per hospital admission were equal to 59% of net household income for the poorest members of society, compared to 18% for middle income families and 8% for those in the highest income group.³ Health problems are far more devastating to the poor than to the rest of society. In China's fight against poverty, a safety net must be erected so poor families can obtain financial assistance for needed health care,⁴ or thousands of otherwise self-sufficient families will slip into poverty, thus reversing the social benefits accrued by the successful elimination of poverty among other families. Since 1996 Shanxi Evergreen Services has been offering medical assistance to poor people in Yangqu County, Shanxi Province, through a fund called the Samaritan Fund. As of September 1999, we had assisted 33 families with an average subsidy of USD 141 per case. Patients are referred by local health care providers.

The main qualification for assistance is inability to afford necessary health care. A second qualification is reasonable hope of a good outcome, thus eliminating cases that are chronic or will be fatal. (Because finances are limited, we have to consider cost-effectiveness; the Fund cannot afford to support patients with chronic conditions, and feels that a better option in such cases is to help the family increase their income so that they can manage the added expense of chronic illness.)

Assistance is also limited to those whose permanent residence is Yangqu County. The reason for this is that we have no ability to determine the true financial situation of 'floating population' patients, nor to follow up on them.

Finally, priority is given to patients where financial assistance will most significantly contribute to the families' overall financial situation. Here are a few examples of typical beneficiaries:

The breadwinner of the family is hit by a car while riding his bicycle. His possibility of almost complete recovery is quite good and he will be able to continue working to support his family. Therefore we assisted with this patients examination and treatment.

A young woman had a massive haemorrhage due to a tubal pregnancy. With assistance, she was able to recover and get back to work and help support her family.

A five year old boy's femur was snapped in an accident.

A twelve year old girl with tuberculosis develops a tuberculin abscess in her back.

Children are given priority as, apart from humanitarian considerations, they could become a great financial burden if their health problems were not tended to early in life. If a child's illness is not properly taken care of, the resulting condition may require special care by the family, there may be ongoing medical costs and, eventually, the child's ability to work and support himself later in life may be hindered.

Assistance would not normally be given to patients whose conditions are chronic or fatal, such as an elderly man with congestive heart failure. Another case we encountered was a 41 year-old woman with stomach cancer. The chances for remission are very poor, even in countries with excellent medical facilities and technology. Her application was rejected.

To our chagrin, some patients have developed a dependence mentality. They seem to think they have earned a 'credit card' allowing them to receive medical assistance upon request with little thought of learning to finance their own health problems. But fortunately this mentality is found among only five or six of the 33 recipients.

Some cases are very difficult to decide; for example, where advanced age or chronic illness are factors, or where other family members are financially able, but unwilling, to help. Once we were referred a 78 year old man whose leg needed to be amputated. Although the outcome would likely have been good, because he was not from this county and his family was reluctant to pay for the surgery rather than unable to pay, he did not receive assistance.

Occasionally there are multiple health problems in one family. A pair of six-month-old twins was admitted to the hospital with pneumonia. The family definitely met the qualification of financial need, and the prognosis seemed quite good. However, after the children recuperated, it became obvious they both had a serious congenital developmental problem that was the reason the twins became ill in the first place. Suddenly the picture changed, and the long-term prognosis for the twins seemed very poor. Meanwhile, the mother of the twins fell ill and had to have surgery for a large cyst on the fallopian tube. We underwrote these expenses, but also decided not to pay for additional medical expenses for the twins who had virtually no hope of surviving long. Indeed, they died shortly after the mother's surgery in another bout of pneumonia.

The Samaritan Fund is extremely useful in this setting and helps save those who are in poverty from falling into abject poverty with no hope of recovering financially in this generation, or possibly, even the next. Decisions about a patient's eligibility are always made after consulting with the medical staff at the hospital and with the Evergreen doctors. Most of those we help recover and return to work without debt.

It is possible that the cases we meet are more expensive than average cases. Generally, the family would borrow from neighbours and relatives to cover emergency medical costs. Only if unable to borrow enough money there would they find their way to us. Therefore, the cases we encounter are likely more devastating than most. However, assuming the Samaritan Fund is a reasonable representation of the scope of the problem of inability to pay for needed health care, what might it cost to provide this kind of assistance to all of Shanxi Province for one year?

Cost per case	USD 141
Estimated number of similar cases each year in Yangqu	335
Total cost per year	USD 47,235
Number of counties in Shanxi (av. pop 198,000) (Excluding urban centres)	91
Projected total cost for province:	USD 4,298,385

At first glance this calculation leads one to dismiss the exercise as sheer folly, for it is impossible to come up with over four million dollars to address the need. However, the focus of this study is the condition of the poor themselves. The point of this paper is not to assess what it would cost to provide comprehensive health coverage to the poor, but to consider the plight of the poor who are now outside the scope of medical assistance. When looked at this way, one is not frightened by the financial obstacles as much as one is moved by the fact that possibly every year there are 30,486 ill and injured people in Shanxi Province who are unable to have their health needs met.

There are other mechanisms in place in China to meet the needs of these people. The Civil Affairs Bureau will provide assistance to some of them, including those who possess an official Handicapped Persons Registration card. The Civil Affairs Bureau also works with village committees to care for some elderly patients with no family. Schools, factories, villages and other community organisations will often take up a semi-compulsory collection for one of their members who is beset with major medical expenses. Also, most city hospitals have an office to process reduced fees for poor patients. However, at present China is simply unable to address this problem in a comprehensive way.

Can the Samaritan Fund and other such programmes serve a useful purpose? For the individuals served, the answer is clearly yes. Can it be expanded to cover even more individuals? Yes, but only with an increase in overhead costs. Can the Samaritan Fund be replicated in any way by local health care facilities? Perhaps, but there would be obstacles to such expansion. These include:

1. County hospitals and township health centres are struggling financially. Some of them cannot pay staff salaries in full; consequently, they cannot afford to offer sliding fee scale services to poor people.
2. The quality of care provided is such that most patients seek three or more doctors and/or visit as many hospitals seeking treatment for their health problems. Finding no relief in one place, they wander to another. Each of these transitions means tremendous waste of resources and a delay in needed treatment.
3. Hospitals feel their income is too low, and local doctors themselves feel their salaries are too low. They feel the pressure to order more tests or prescribe more drugs as a way of increasing their income. ⁵
4. The referral system does not work efficiently. Doctors in one facility cannot smoothly refer difficult cases to a larger facility and feel confident that these complicated health problems will be dealt with clearly, at minimum necessary cost and with a minimum of repeat lab work and tests done.
5. Currently, when a treatment is prescribed, little thought is given to the family's financial condition.
6. Problems also come from the patients' side. Some people are opportunistic, and prone to take advantage of the system for personal benefit. Also, at times patients do not cooperate with a treatment programme, or fail to return for necessary follow-up examinations or treatment. This also leads to waste and a delay in the return to health.

It is unlikely that either the Chinese government or foreign donors would ever come up with the kind of financial resources necessary to fully address this problem. However several things have come clear through the process of operating our Fund. First, this is not an unhealthy, dependency-building system, but a programme desperately needed by thousands of families each year. Second, the fight against poverty must take into consideration the relationship between poor health and poverty. Health care services in poor areas must be improved. Third, while families in one area are being rescued from poverty, families in another area, otherwise able to meet their needs, are slipping into serious poverty because of one illness or accident. Therefore, families on the edge of poverty need a safety net such as the Samaritan Fund to sustain them through an illness incident. Fourth, the health care system, which is becoming a free market faster than any other industry in China, must be reformed. Costs for medications, hospitalisation and ancillary tests must be contained. Fifth, in a similar vein, social health care systems must be introduced more hastily, in order to provide the poor with needed basic health care services. The promotion of a health insurance industry in China is good and necessary, but it will have no effect on the indigent population.

With proper management, the Samaritan Fund can be duplicated. While it is not likely the model for China's national medical assistance programme, such small-scale trial programmes can provide important information and experience upon which to build a larger programme. Definitely, foreign businesses and NGOs can provide medical assistance as we have done through the Samaritan Fund, but careful preparation must go into setting it up, to avoid abuse or unhealthy dependencies.

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¹ New York Times. November 19, 1998
²Gu, X. Y. (ed.), 1996, Financing of Health Services in Poor Rural China, Shanghai: Baijia Publishers.
³ Yu, H., Cao, S. H. and Lucas, H., 1997, "Equity in the utilization of medical services: a survey in poor rural China", IDS Bulletin, Vol. 28 No. 1:24-31.
⁴ This is the clear conclusion of July 1997 Working Paper No. 58, "Coping with the Costs of Severe Illness in Rural China", Wilkes, Andreas; Hao, Yu; Bloom, Gerald and Xingyuan, Gu, Institute of Development Studies.
⁵ To add to the concern, drug sales already comprise the largest portion of the medical assistance given (43%) by the Samaritan Fund, and this will only worsen in the future. Already many hospitals are relying on drug sales to sustain themselves. According to the New York Times article mentioned above, up to 80% of the income of most hospitals comes from drug sales.