The dismantling of China’s communal farms led to considerable cost-shifting from the state (specifically, state enterprises) back to the individual. In response, Harvard Professor William Hsiao has been piloting health insurance at the village level there.
One interesting goal of the project is to attack the problem over-medication, which is rampant in the Chinese system. Physicians make a profit from selling medications, and medication usage is (unsurprisingly) high under this system. The WHO reported that markups for drugs ranged from 40% to 80%, and another study of influenza patients found that 61% of the medications they were prescribed were unnecessary.
There’s more detail in the Wall Street Journal (subscription required). Hmm, do they need a cheap IT system?
The Sentinel Effect 
July 5, 2007 at 8:23 pm
Could the Chinese government institute price controls? Could the doctors be better remunerated in exchange for adhering to such price controls? Do the pharmaceutical companies have much influence over Chinese politics?