Updates on China’s Health Care Reform

In the most recent development of China’s nationwide health care reform
that was introduced in January of this year, the Chinese Ministry of Finance
stated on July 6, 2009 that approximately 10.4 billion RMB (approximately $1.52
billion) would be allocated to public health care for 2009. In the same week,
the ministries of finance, health, civil affairs, human resources and social
security issued a circular that called for greater funding from local governments
for health care services.

The Chinese Vice-Premier Li Keqiang reiterated the importance of this reform
that serves to benefit the Chinese people, increase investment and consumption,
and ultimately, to stimulate economic growth.

The State council released an official health care reform plan for 2009, as
part of the three-year reform, on July 23, 2009. The plan designated one hundred
state hospitals across twelve cities as pilot hospitals as part of the hospital
reform, and outlined a need to quickly establish a system for basic medical
insurance, pharmaceuticals, and primary care facilities. Lastly, the standards
for constructing primary care facilities are to be issued later in the year.
It is estimated that more than 900 hospitals, 3,500 town hospitals, and 1,150
community medical centers are going to be created.

By the end of the year, there will be at least seventy million more people
covered under basic health insurance than there was last year. The total number
of insurance-covered citizens in China will be at around 390 million people.