The Cooperation between the Market Insurance and the New Rural Medical Insurance

Under the process of social security net,it is very important for an effective risk sharing mechanism of disease,if we could clearly identify the relationship which is complementary or crowd-out,between the market insurance and the new rural medical insurance.Based on the selective-behavior and expected Utility Theory,the insurance demand modeling shows that,from the standpoint of the insured,their relationship is the complementary.It results that the volume of the market insurance will rise with the rising of reimbursement rates in the new rural medical insurance.It depends on the possibility of serious illness,risk preference and the net profit according to the purchase behavior.So we may let the market insurance operated well if we focus on the developed merchandise of the new rural medical insurance,the optimum price of the market insurance and the coverage intensity.