Regulating Health Care Markets In China And India Regulatory approaches based on functioning local institutions seem to work best in both countries. by Gerald Bloom, Barun Kanjilal, and David H. Peters ABSTRACT: Health care markets in China and India have expanded rapidly. The regulatory response has lagged behind in both countries and has followed a different pathway in each. Using the examples of front-line health providers and health insurance, this paper dis- cusses how their different approaches have emerged from their own historical and political contexts and have led to different ways to address the main regulatory questions concern- ing quality of care, value for money, social agreement, and accountability. In both countries, the challenge is to build trust-based institutions that rely less on state-dominated ap- proaches to regulation and involve other key actors. [Health Affairs 27, no. 4 (2008): 952– 963; 10.1377/hlthaff.27.4.952] C hina and india are two countries whose economies are grow- ing rapidly and where governments have found it important to stimulate reforms to strengthen their social sectors. In the 1950s and 1960s, both countries invested in largely public health systems. Yet both health systems have become highly marketized, although they have taken different routes. Both coun- tries are now facing a crisis of trust in the health sector, attributable in part to ris- ing expectations and concomitant failures in their health care markets. 1 Each country is tackling the issue of how to regulate its health care market differently. n Views about regulation. The traditional view of regulation is that it is a gov- ernment function, dealing with the laws, orders, and rules placed by government on enterprises, citizens, and government itself. 2 A more holistic view incorporates roles of other key players in the formulation and implementation of regulations, which are continually under development, and where the interests and incentives of those in- volved in regulation matter greatly. 3 The key institutions in the regulation of the health sector include those involved in the production and distribution of health- related services and products (for example, health care providers, hospital and phar- macy owners, and professional associations); those financing health services (for ex- 952 July/August 2008 Reform Goes Global DOI 10.1377/hlthaff.27.4.952 ©2008 Project HOPE–The People-to-People Health Foundation, Inc. Gerald Bloom is a research fellow at the Institute of Development Studies in Brighton, United Kingdom. Barun Kanjilal is a professor at the Institute of Health Management Research in Jaipur, India. David Peters (dpeters@ jhsph.edu) is an associate professor in the Department of International Health, Johns Hopkins Bloomberg School of Public Health, in Baltimore, Maryland. Downloaded from HealthAffairs.org on May 25, 2020. Copyright Project HOPE—The People-to-People Health Foundation, Inc. For personal use only. All rights reserved. Reuse permissions at HealthAffairs.org.