The world's most densely populated country is in dire need of reform to an ailing medical system and now the Central Committee of the Communist Party of China and the State Council have given their backing to reforming the health care system after three years of intense discussion and revision.
The plan aims to provide in the next 11 years, a "safe, effective, convenient and affordable" basic health-care system and services to all urban and rural residents.
Providing basic health care as a public service will demand greater government funding and supervision and a more detailed implementation plan for the three years up until 2011, not as yet published, will cost 850 billion yuan (US$124 billion).
According to reports the government's role in formulating policies and plans, raising funds, providing service, and supervising, will need to be strengthened in order to ensure the fairness and equity of the service.
Experts say this is the first time that basic medical services in China are clearly defined as a public service for all citizens, which is part of the essential rights of the people.
The reform apparently aims to address long-standing criticism that medical services are difficult to access and increasingly unaffordable for many Chinese, a situation created by the huge development gap between cities and rural areas, low government funding, weak health care facilities in rural areas, and increasing disease burdens - despite the country's effort to double the average life expectancy over the past 60 years.
China's social security network, already burdened by expensive education, fast population ageing and unemployment, has been further stretched by soaring medical bills forcing many ordinary Chinese to save money, instead of spending, as a precautionary measure.
With the People's Republic of China in 1949, most city residents had almost all medical expenses paid for, while in rural areas healthcare was basic but completely free.
The economic reforms in the early 1980s, meant the system was switched to a market-oriented health care system but low government funding forced doctors at state-run hospitals to "generate" incomes for the hospitals through prescribing highly-profitable, sometimes unnecessary drugs and treatment - which often accounted for 90% of a hospital's income - many were plunged into poverty and medical services became unaffordable to ordinary citizens.
A decade of reforms from 1997, such as the basic medical insurance for urban employees and the new cooperative medical scheme for farmers, were gradually implemented but were on the whole unsuccessful. This new blueprint focuses on the establishment of a basic health care system to cover all Chinese citizens, formed on the basis of systems of public health, medical service, medical insurance and medicine supply.
The public health network for disease prevention and control, health education, mother and infant health care, mental health and first aid services, will be improved.
The provision of medical services will remain the domain of public, non-profit hospitals while more priority will be given to the development of hospitals and clinics in cities and rural areas, which are often ill-equipped and understaffed.
Comprehensive hospitals in large cities will be expected to provide more support to small, local hospitals in terms of personnel, expertise and equipment.
China's government also plans to set up diversified medical insurance systems in order to ensure everyone is covered by some sort of insurance plan.
The reform also aims to improve the medicine supply system so that public hospitals and clinics are supplied with essential medicines with prices regulated by the government.
The government plans to enhance the management and supervision of the operation of medical institutions, the planning of health service development, and the basic medical insurance system.
Public hospitals while they will receive more government funding and be allowed to charge higher fees for treatment will eventually be banned from making profits through subscribing expensive medicines and treatment.
The regulation of the pricing systems of medical services and medicines, with particular control on the price of basic services at non-profit hospitals and essential medicines those hospitals use, will also be addressed and the supervision of medical institutions, health insurance providers and pharmaceutical companies and retailers, strengthened.
The monitoring of drinking water and food safety, and safety in workplace, will also be monitored.
The World Health Organization says the aim to improve equitable access to essential health care for all Chinese is "laudable" but the success of the reforms will depend on how effectively the vision is implemented in different sectors and regions across China.
The new plan promises 2000 new county hospitals and 5000 township clinics in rural areas in the next three years, a national database and regular free checkups for anyone over 65 and children under three.