A Comparative Analysis of Impact of Universal Two-Child Policy on Maternity Insurance Fund in Jiangsu Province and Guangxi Zhuang AR.

The maternity insurance fund in some provinces in China has accumulated unprecedented deficit levels. This imminent depletion can cause a catastrophic health crisis for maternal health. This study analyzed the post-policy impact of key factors on maternity insurance income inflow and outflow in Jiangsu Province and Guangxi Zhuang Autonomous Region (AR). We applied Pasera's ARLD model and VECM Granger Causality Test to establish long- and short-term impact of selected factors that determines the income and expenditure of the maternity insurance fund in the two regions based on data from 2011 to 2019. Our results show that the addition of new births due to the universal two-child policy has increased the per capita utilization of the maternity insurance fund in both areas. We further observed that the impact of the maternity insurance contribution rate to the maternity insurance fund decays with time giving a long-run limited impact in both provinces. Thus the positive impact is stronger in the short term, but in the long term, its influence or contribution to stability of the funds reduces. The positive impact of interest from investment in the maternity insurance fund is however insignificant in both provinces, giving a major cause for concern on its role in maternity insurance fund income generation. In the short term, the contribution rate of the maternity insurance fund must be adjusted upward or the payment base expanded to receive additional contribution from all employees to avoid complete depletion of the fund. In the long term, we recommend the need to replenish the maternity insurance funds through proper investment options for the funds. We further recommend the need to look for other sources of funding social interventions based on existing practices in other countries.