Background

China has, rightly, been noted for a health system which gives priority to the needs of the rural population, with an accessible network of basic health services, a preventative orientation and with innovative financial solutions. The Chinese health system has been reported to contribute to a better than expected population health status at a lower than expected cost (Halstead et al., 1985; World Bank, 1993). The acclaim for the Chinese health system influenced WHO to promote PHC and to launch the slogan ‘Health for All by the year 2000’ (Rohde, 1983).

Starting from the revolutionary decade of the 1960s, China developed a number of alternative and complementary health financing systems. Key characteristics of the different financing systems are laid out in Table 10.1. The delivery of basic health services for the rural population was closely linked to the rural health insurance, the Cooperative Medical System (CMS).

In the mid-1980s China, like many other countries, launched a health reform process. In many developing countries health reforms were not ‘own’ initiatives. Frequently they resulted from pressures for budget reductions in the context of structural adjustment programmes, often with severe implications for sectors such as health and education (Pinstrup-Andersen et al., 1987).

In China, health reforms may have been influenced by donor policy advice, although not necessarily driven by external pressures.