Abstract: Hierarchical medical system is an important measure to solve the problem of “high cost for getting medical treatment, difficult to receive medical treatment”. Based on the medical service utilization model, this paper makes use of the data of CFPS 2014 to empirically test the effect of the hierarchical medical system on household medical financial burden. The findings show that the household medical financial burden can be significantly reduced by residents choosing the first treatment at the grass roots, and the effect is more obvious on the patients with chronic diseases or having the experience of hospitalization. The proportion of reimbursement for medical expenses is critical to reducing household medical financial burden. But the effect of the construction of grass root medical institutions is not significant. This paper puts forward the following countermeasures: to cultivate family doctors and enrich their services, and guide the residents to treat their diseases firstly at the grass root clinics; to raise the proportion of reimbursements for medical expenses at the community level, and to pay for the services of family doctors in capita; to improve the level of medical treatment of primary health care institutions, so as to attract the residents to sign contracts for medical treatments.

Key words: hierarchical medical system; household medical financial burden; first treatment at the grass roots