Chen Yugui, a farmer from north China's Shanxi Province, did not expect that a small amount of money he decided to spend four years ago turned out to be a prudent and high-return investment.

With an annual income of about 4,000 yuan (about US$588), the 74-year-old and his wife from Gaoping city had the habit of avoiding seeing doctors for fear of high medical bills.

In 2007, Chen was rushed to hospital with cerebral hemorrhage. He was saved, but the medical treatment was nearly 30,000 yuan (about US$4,412), more than seven times his annual income.

Fortunately he had paid 10 yuan a year to join the cooperative medical care launched in Gaoping City in 2006. Chen was entitled to a maximum of 50,000 yuan (about US$7,353) reimbursement for his medical treatment.

"We had about 18,000 yuan (about US$2,647) reimbursed," Chen said.

Chen is among more than 800 million farmers in China who have joined the new cooperative medical care system.

Expanding the cooperative medical care system is just one step of China's health care strategy which aims to introduce cheaper medical services for all.

China unveiled its three-year plan for health care reform, involving an investment of at least 850 billion yuan (US$124 billion), in April 2009. It aims to lay a solid foundation for equitable and universal access to essential health care for everyone in the country by 2020.

Providing cheaper services

In China's vast rural areas, farmers know many proverbs to express their difficulties with medical treatment. "Three days in hospital, remaining years in debt" is one of them.

Some farmers, like Chen, missed the old days of free medical services in rural areas.

After the founding of the People's Republic of China in 1949, farmers had access to subsidized health clinics run by "barefoot doctors", who were basically middle-school students trained in first aid.

The primitive service, essentially free, played a role in doubling the country's average life expectancy from 35 years in 1949 to 68 years in 1978.

When China began its economic reforms in the early 1980s, the system was dismantled as the country attempted to switch to a market-oriented healthcare system. But the government failed to establish a viable substitute, leaving its large rural population without health insurance.

The Chinese government launched a new cooperative medical program in 2003 in the rural areas to offer farmers basic healthcare. Under the scheme, a participant pays 10 yuan (US$1.3) a year, while the state, provincial, municipal and county governments supply another 40 yuan (US$5.2) to the fund.

When rural residents fall seriously ill, a proportion of hospital expenses will be covered from the pooled insurance. The rate of reimbursement varies according to different kinds of illness and the actual cost of medical expenses incurred.

In addition to the system, other efforts have also been mounted to improve basic medical services in rural areas.

To ensure that all farmers could have access to affordable medical service, the Ningxia Hui Autonomous Region launched a "one-yuan medical treatment" program in the spring of 2009 in Guyuan and Yinchuan.

According to Long Haizhen, a farmer with the Sanshilipu Village of Guyuan City, drugs in the village clinics were free-of-charge if their price added up to less than three yuan. If the price was higher, no matter how much, the patient was charged only one yuan.

Long brought her four-year-old son to the clinic as the boy had a sore throat. They were prescribed with anti-inflammatory drugs, which cost Long one yuan.

"Our home is four kilometers away from the clinic," she said. "We came by bus and the ticket also cost one yuan. The medicine was so cheap."

Local governments have also tried to build more village clinics and improve their conditions so that farmers would be able to have their illness treated without going too far.