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Chinas New Cooperative Medical System (NCMS) has drawn considerable attentionfrom researchers and policy makers.This paper assesses the impact of the NCMS from a newperspective by estimating the contribution of health insurance to the inequality of health careutilization in rural China.The analysis uses data obtained from Chinas health and NutritionSurvey (CHNS) for the period from 2004 to 2006.This paper decomposes income-relatedinequality in the utilization of health care services into four sources:direct income effect; needrelated indicators; non-need related indicators (education,occupation,health insurance,etc.);and a residual term.The results show that,other things being equal,income has a pro-rich effectwhile need-related factors have a pro-poor effect.NCMS contributes pro-rich inequalities ingeneral health care utilization in both men and women,but its pro-rich contribution in generalhealth care utilization became smaller in 2006.The contribution of NCMS to inequalities in usinghigher level facilities is smaller.During 2004 to 2006,NCMS contributes more in improvinggeneral health care utilization inequalities of women.During same period of time,higher levelhealth care utilization inequality improves more.But the main contributor is the declining effectof income,especially for women.