China Unveils Sweeping Reforms to Bring Flexible Workers into Employee Medical Insurance
China’s National Healthcare Security Administration (NHSA) announced a comprehensive set of measures on September 4 to expand employee medical insurance coverage for the country’s more than 200 million flexible workers, including food delivery riders, ride-hailing drivers, and migrant laborers. The policies, unveiled at a State Council Information Office press conference, aim to dismantle long-standing enrollment barriers and make premium payments more adaptable to the irregular work patterns of those without traditional employment relationships.
Deputy NHSA Director Huang Huabo said the agency will push to fully eliminate household registration (hukou) restrictions that have prevented flexible workers from enrolling in medical insurance at their place of employment or residence in megacities. According to Xinhua News, most megacities have already lifted these restrictions, with Shanghai becoming the latest in 2026 to open its resident medical insurance to registered students and children without local hukou.
Growing Enrollment, Persistent Barriers
The announcement comes amid steady growth in flexible worker participation in China’s employee medical insurance system. Huang reported that 69.82 million flexible workers and other personnel enrolled in employee medical insurance nationwide in 2025, a year-on-year increase of 5.54 percent, according to CCTV News. Overall basic medical insurance enrollment grew from 1.327 billion in 2024 to 1.331 billion in 2025, with employee medical insurance now covering 379 million people.
Employee medical insurance typically offers higher reimbursement rates and broader coverage than the resident insurance tier, but enrollment has traditionally been tied to formal employment relationships. Flexible workers—who account for nearly 30 percent of China’s approximately 725 million employed persons—have faced significant hurdles, including hukou restrictions in some megacities and the financial burden of paying both employer and employee contribution portions.
Structural Innovations in Contribution and Coverage
The new measures introduce several structural changes designed to accommodate the irregular work patterns of flexible employees. Notably, workers who participate in employee medical insurance on a periodic basis—such as migrant workers who work seasonally—will be allowed to accumulate contribution periods on a monthly basis, ensuring that fragmented payment periods count toward the total years needed for retirement medical benefits.
The NHSA is also exploring the conversion of consecutive years of resident medical insurance contributions into local employee medical insurance contribution years, with conversion ratios adapted to local funding levels. This creates a pathway for those who have contributed to the resident system to transition to the employee system without losing prior contribution years.
On the payment side, flexible workers will be able to make monthly premium payments, with exploration of quarterly, semi-annual, and annual prepayment models to accommodate irregular income streams. Platform companies in food delivery, express delivery, ride-hailing, and domestic services will be encouraged to adopt suitable payment methods for eligible workers, building on ongoing efforts to reduce the contribution burden on platform-based employees.
“We are continuously promoting the comprehensive elimination of household registration restrictions for participation in medical insurance at place of employment or residence in megacities,” Huang said at the press conference, as reported by Phoenix News. “We also encourage local governments to include flexible workers in maternity insurance coverage, with contributions and benefits according to regulations.”
Maternity Insurance: A Parallel Expansion
The press conference also highlighted significant progress in extending maternity insurance to flexible workers. Wang Wenjun, another NHSA deputy director, said that 22 provinces and 193 coordinated regions have already included flexible workers in maternity insurance coverage. In the first seven months of 2026, the maternity insurance fund spent 78.42 billion yuan (approximately $11.6 billion), benefiting 25.56 million people, according to Global Times.
“During the 15th Five-Year Plan period, we will vigorously promote flexible workers, migrant workers, and workers in new employment forms who participate in employee medical insurance to also participate in maternity insurance,” Wang said, noting that more delivery workers, ride-hailing drivers, and freelancers will be able to enjoy both reimbursement of medical expenses and maternity allowances.
Cross-Province Account Sharing and Service Upgrades
The NHSA reported that 337 coordinated regions have already enabled cross-province sharing of employee medical insurance personal accounts, allowing funds to be used by spouses, children, parents, and other close relatives. The agency will also streamline online and offline business handling channels, implement a “One-Stop Flexible Employment Insurance Enrollment” integrated service, and encourage local governments to establish medical insurance service stations.
Legal Framework and Broader Reform Context
These measures are part of the broader healthcare reform agenda under China’s 15th Five-Year Plan (2026-2030), which also includes establishing a nationwide long-term care insurance system by the end of 2028 and deepening payment method reform in medical institutions. The newly passed Medical Insurance Law, approved by the Standing Committee of the National People’s Congress on August 28, explicitly encourages flexible workers to participate in employee basic medical insurance. The law takes effect January 1, 2027, providing a legal foundation for these policy measures, as China Youth Network reported.
Remaining Hurdles
Despite the significant progress, challenges remain. Some megacities, notably Beijing, still maintain hukou restrictions on flexible worker enrollment in employee medical insurance, though the NHSA is pushing for their elimination. The financial burden of employee medical insurance contributions—which typically require flexible workers to pay both employer and employee portions—continues to be a barrier for many low-income workers, as Southern Metropolis Daily has noted in its coverage of the issue.
Contribution year requirements for retirement medical benefits also vary by region, and the conversion mechanism between resident and employee systems will need further refinement as implementation proceeds.
Outlook
As the Medical Insurance Law takes effect in January 2027, observers will be watching how quickly remaining hukou barriers fall in megacities like Beijing, and whether platform companies meaningfully step up their role in facilitating insurance enrollment for their workers. The expansion of maternity insurance to flexible workers across more provinces, along with the buildout of the national long-term care insurance system by 2028, will be key indicators of whether China’s social safety net is successfully adapting to the realities of its rapidly evolving labor market.