This study investigates the causal impact of acquiring social medical Insurance on hospital utilisation and health status for children under 16 years old in China from 2010 to 2016. We consider the China Family Panel Studies (CFPS), a longitudinal database which allows us to control for the effect of unobserved individual heterogeneity by means of difference-in-difference regressions combined with matching regression techniques. Our findings suggest that participating in social medical insurance schemes significantly increases children’s yearly hospital use, especially for children who come from rural China. Moreover, this increase is not significantly different for people who were not previously sick. It is also found that social medical insurance schemes have no effect or even a marginally negative effect on children’s health status in some cases. We discuss some potential explanations for this result.