FOREWORD

For many decades，rising health care costs have posed a serious challenge to governments around the globe.Given current demographic，technological，and social trends，this pattern is likely to continue throughout the foreseeable future.In the present volume，Professor Zhang Ying offers a thoughtful and compelling analysis of the central role of health insurance in addressing this difficult policy issue.

Although individual payments for medical services typically satisfy certain conventional requirements for“insurability”-large numbers，statistical independence，and relatively well-behaved underlying probability distributions-they often deviate from other requirements because of both（1）the inherent danger of adverse selection and（2）uncertain cost increases associated with aging populations，improving technology，and social change.Not surprisingly，different nations have chosen distinctly different health care reimbursement schemes to suit their specific needs.

Zhang Ying’s analysis provides the broad perspective and technical rigor necessary for a successful treatment of her subject.Over a period of seven years，she conducted research in more than ten countries，drawing insights from the experiences of numerous health care systems on four continents.

As indicated by the book’s title，her approach focuses on the relative advantages of public and private health insurance designs，and how these mechanisms may be used to complement each other in managing the serious problems of health care financing.Toward the end of the volume，she devotes several chapters to a close study of China’s developing health insurance system，culminating in a novel proposal for financing critical illness under China’s New Urbanization Plan.

Professor Zhang’s work will be of great interest not only to policy makers and insurance researchers/practitioners，but also to general readers desiring a deeper understanding of health care policy evolution in the years to come.I am confident that her book represents an important milestone in China’s health insurance literature.

Michael R. Powers，Ph.D.

Zurich Group Professor of Risk MathematicsChair，Department of Finance

School of Economics and ManagementTsinghua University