Part of the medical insurance fee paid each year is used to pay the medical expenses of the insured, and the other part enters the medical insurance fund for management and use.

The medical insurance fund is formed by the medical insurance premiums, government subsidies and other income paid by the insured, and is mainly used to pay the medical expenses of the insured. The medical insurance fund is divided into two parts: individual account and overall fund. The individual account is used to pay the self-paid part of the insured's outpatient and inpatient medical expenses, and the overall fund is used to pay part or all of the insured's inpatient medical expenses.

When the overall fund pays the medical expenses of the insured, it will be allocated according to the patient's condition and the level of the hospital. For some patients who need long-term treatment or serious illness, the overall fund may pay more. In addition, the medical insurance fund will also supervise and manage hospitals to ensure that hospitals provide reasonable medical services and control the growth of medical expenses.

To sum up:

The medical insurance premium paid every year is not used, and part of it is used to pay the medical expenses of the insured, and the other part goes into the medical insurance fund, which manages and uses it. The medical insurance fund is divided into two parts: individual account and overall fund. The individual account is used to pay the self-paid part of the insured's outpatient and inpatient medical expenses, and the overall fund is used to pay part or all of the insured's inpatient medical expenses. When the overall fund pays the medical expenses of the insured, it will be allocated according to the patient's condition and the level of the hospital. The medical insurance fund will also supervise and manage hospitals to ensure that hospitals provide reasonable medical services and control the growth of medical expenses.

Legal basis:

The first paragraph of Article 23 of the Social Insurance Law of People's Republic of China (PRC) stipulates: "Employees shall participate in basic medical insurance for employees, and employers and employees shall pay basic medical insurance premiums in accordance with state regulations." Article 29 stipulates: "The part of the medical expenses of the insured that should be paid by the basic medical insurance fund shall be directly settled by social insurance agencies, medical institutions and pharmaceutical trading units." Article 30 stipulates: "The following medical expenses are not included in the scope of payment of the basic medical insurance fund: (1) those that should be paid by the industrial injury insurance fund; (2) It shall be borne by a third party; (three) shall be borne by public health; (4) Go abroad for medical treatment. Medical expenses that should be borne by a third party according to law. If the third party is unable to pay or cannot determine the third party, the basic medical insurance fund will pay in advance. After the basic medical insurance fund pays in advance, it has the right to recover from the third party. "