Under the NRCMCS, the annual cost of medical coverage is 50 yuan (US$7) per person. Of that, 20 yuan is paid in by the central government, 20 yuan by the provincial government and a contribution of 10 yuan is made by the patient. As of September 2007, around 80% of the rural population of China had signed up (about 685 million people). The system is tiered, depending on the location.

If patients go to a small hospital or clinic in their local town, the system will cover roughly 70-80% of their bill. If the patient visits a county clinic, the percentage of the cost being covered falls to about 60%. If the patient requires a specialist in a modern city hospital, the plan would cover about 30% of the bill.

Health indicators

China's health indicators include the nation’s fertility rate of 1.8 children per woman (a 2005 estimate) and the infant mortality rate per 1,000 live births was 25.3 (a 2004 estimate).[citation needed]

In 2005 China had about 1,938,000 physicians (1.5 per 1,000 persons) and about 3,074,000 hospital beds (2.4 per 1,000 persons).

Health expenditures on a purchasing power parity (PPP) basis were US$224 per capita in 2001, or 5.5 percent of gross domestic product (GDP).

Some 37.2 percent of public expenditures were devoted to health care in China in 2001. However, about 80 percent of the health and medical care services are concentrated in cities, and timely medical care is not available to more than 100 million people in rural areas.

To offset this imbalance, in 2005 China set out a five-year plan to invest 20 billion renminbi (RMB; US$2.4 billion) to rebuild the rural medical service system composed of village clinics and township- and county-level hospitals.

Traditional and modern Chinese medicine

China has one of the longest recorded history of medicine records of any existing civilization. The methods and theories of traditional Chinese medicine have developed for over two thousand years.

Western medical theory and practice came to China in the nineteenth and twentieth centuries, notably through the efforts of missionaries and the Rockefeller Foundation, which together founded Peking Union Medical College.

Today Chinese traditional medicine continues alongside western medicine and traditional physicians, who also receive some western medical training, are sometimes primary care givers in the clinics and pharmacies of rural China.

Various traditional preventative and self-healing techniques such as qigong, which combines gentle exercise and meditation, are widely practiced as an adjunct to professional health care.

Although the practice of traditional Chinese medicine was strongly promoted by the Chinese leadership and remained a major component of health care, Western medicine gained increasing acceptance in the 1970s and 1980s.

For example, the number of physicians and pharmacists trained in Western medicine reportedly increased by 225,000 from 1976 to 1981, and the number of physicians' assistants trained in Western medicine increased by about 50,000.

In 1981 there were reportedly 516,000 senior physicians trained in Western medicine and 290,000 senior physicians trained in traditional Chinese medicine. The goal of China's medical professionals is to synthesize the best elements of traditional and Western approaches.

In practice, however, this combination has not always worked smoothly. In many respects, physicians trained in traditional medicine and those trained in Western medicine constitute separate groups with different interests.

For instance, physicians trained in Western medicine have been somewhat reluctant to accept unscientific traditional practices, and traditional practitioners have sought to preserve authority in their own sphere.

Although Chinese medical schools that provided training in Western medicine also provided some instruction in traditional medicine, relatively few physicians were regarded as competent in both areas in the mid-1980s.

The extent to which traditional and Western treatment methods were combined and integrated in the major hospitals varied greatly.

Some hospitals and medical schools of purely traditional medicine were established. In most urban hospitals, the pattern seemed to be to establish separate departments for traditional and Western treatment. In the county hospitals, however, traditional medicine received greater emphasis.

Traditional medicine depends on herbal treatments, acupuncture, acupressure, moxibustion (burning of herbs over acupuncture points), "cupping" (local suction of skin), qigong (coordinated movement, breathing, and awareness), tui na (massage), and other culturally unique practices.

Such approaches are believed to be most effective in treating minor and chronic diseases, in part because of milder side effects.

Traditional treatments may be used for more serious conditions as well, particularly for such acute abdominal conditions as appendicitis, pancreatitis, and gallstones; sometimes traditional treatments are used in combination with Western treatments.

A traditional method of orthopedic treatment, involving less immobilization than Western methods, continued to be widely used in the 1980s.

Primary care

After 1949 the Ministry of Public Health was responsible for all health-care activities and established and supervised all facets of health policy.

Along with a system of national, provincial, and local facilities, the ministry regulated a network of industrial and state enterprise hospitals and other facilities covering the health needs of workers of those enterprises. In 1981 this additional network provided approximately 25 percent of the country's total health services.

Health care was provided in both rural and urban areas through a three-tiered system. In rural areas the first tier was made up of barefoot doctors working out of village medical centers.

They provided preventive and primary-care services, with an average of two doctors per 1,000 people; given their importance as health care providers, particularly in rural areas, the government introduced measures to improve their performance through organised training and an annual licencing exam.

At the next level were the township health centers, which functioned primarily as out-patient clinics for about 10,000 to 30,000 people each. These centers had about ten to thirty beds each, and the most qualified members of the staff were assistant doctors.

The two lower-level tiers made up the "rural collective health system" that provided most of the country's medical care. Only the most seriously ill patients were referred to the third and final tier, the county hospitals, which served 200,000 to 600,000 people each and were staffed by senior doctors who held degrees from 5-year medical schools.

Utilisation of health services in rural areas has been shown to increase as a result of the rise in income in rural households and the government's substantial fiscal investment in health.

Health care in urban areas was provided by paramedical personnel assigned to factories and neighborhood health stations. If more professional care was necessary the patient was sent to a district hospital, and the most serious cases were handled by municipal hospitals.

To ensure a higher level of care, a number of state enterprises and government agencies sent their employees directly to district or municipal hospitals, circumventing the paramedical, or barefoot doctor, stage.