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China: Basic Health Services 8 Project

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Investing in Health Care for China’s Rural Poor

Investing in Health Care for China’s Rural Poor


In the late 1990s, China, with support from the World Bank and other development partners, undertook to improve basic health services and increase healthcare accessibility for an estimated 47 million people living in poor rural areas through the Basic Health 8 Project (1998 to 2007). With improved prenatal care and increased hospital delivery, maternal and infant mortality rates were nearly halved in project areas and health service utilization increased considerably among the rural poor.

View the slideshow: Investing in Health Care for China’s Rural Poor


Despite China’s impressive progress in raising health standards in the 1960s and 1970s, a health divide emerged in the 1980s between poor rural areas and more prosperous and urban regions. Infant mortality rates were three times higher than in urban areas and maternal mortality rates were twice as high.

The growing problems in rural healthcare resulted in large part from a decline in government support for public health programs, the collapse of community financing of health services, a top-down approach to health planning, and a lack of coordination between various health system levels. These conditions led to inefficient and unbalanced capital investments, wasteful health expenditures, and financial barriers that made health services inaccessible for the very poor.

Impoverished rural residents faced a health system that offered no guarantee of services or financial assistance, poorly trained and supervised staff, and facilities in bad condition. “Fee for service” models encouraged unnecessary prescriptions and procedures, and families were often pushed into poverty as a result of health care-related debt. Centralized and provider-focused planning approaches meant that health systems were unresponsive to local needs and priorities.


Recognizing the need to act, in early 1997, the Government of China established priorities for health sector reform and development. The Basic Health 8 Project set out to help China strengthen its rural health sector by reforming the management of health resources, upgrading rural health facilities, improving the quality and effectiveness of health services and programs, and increasing risk sharing and the affordability of essential health care for the poor.

The project had two parts. Part I, the main Basic Health Services Project covering 71 counties in seven provinces, focused on improving planning, management and health infrastructure, and increasing the quality, effectiveness, and affordability of health services. Part II, the Qinba Health Program covering 26 counties in three provinces, focused on maternal and child health care and other key health interventions, such as tuberculosis (TB) control and immunization, and on a medical financial assistance program, which reimburses providers for the costs of services for the very poor and reduces the cost of services for the poorest families.


The project achieved substantial results, specifically:

  • Maternal, infant and under-six child mortality fell significantly to equal or below the national average. Maternal mortality in counties covered by Part I of the project decreased by over 40 percent from 1998 to 2005; counties covered in Part II fell by 7 percent between 2002 and 2005. Infant mortality fell by 49 percent in Part I counties and considerably in Part II counties between 1997 and 2006.
  • A total of 1,107 township health centers were built or renovated and provided with more and better medical equipment. More than 931,000 medical staff and workers received training.
  • Rural Cooperative Medical Schemes were established, with enrollment increasing from 194,000 to more than 10 million in the project areas between 1997 and 2006. Piloting of cooperative schemes also provided practical experience and lessons for national implementation later on.
  • The Medical Financial Assistance Program ensured that the poorest received subsidies for their medical expenses. Approximately 143,000 people received hospitalization subsidies between 1997 and 2006 and nearly 1.2 million people received outpatient subsidies and free immunization from 1997 to 2006. The program later became the national policy and was implemented all over China.
  • All project counties adopted annual health resource planning processes and developed a health information system, leading to more efficient use of health resources.
  • Hospital delivery rates increased from 33 percent in 1998 to 74 percent in 2006 in the project areas, an increase of 124 percent. In particular, hospital delivery rates for low-income women increased from 17 percent to 73 percent, and hospital delivery rates for ethnic minority women from 13 percent to 79 percent.
  • Approximately 16,000 TB patients were cured and 9,500 cataract patients received free or subsidized surgeries between 1997 and 2006.
  • Approximately 93,000 women received subsidies for prenatal care and hospital delivery and 536,000 women received free or subsidized health exams between 1997 and 2006.
  • Immunization coverage increased from 77 to 98 percent between 1997 and 2006; hepatitis B vaccination coverage rose from 42 to 67 percent; and the proportion of the tuberculosis control program using the standard Directly Observed Treatment Short (DOTS) course protocol rose from 71 percent (2002) to 100 percent.


I go to the doctor when I feel really bad. Sometimes I will get medicine and injections, and other times I will be hospitalized for three days to a week. My expenses are covered by the program.

— Bai Tingfang, a 78-year-old farmer
in Gansu Province, suffers from bronchitis

In Beijing, it would cost several thousand yuan. Even a rural private doctor would charge several hundred yuan. We only paid 180 yuan to the (township) hospital, with everything included, even immunization for the baby.

— Sun Wen, a worker in Beijing
delivered a baby boy in a township hospital


Additional financial support from development partners included:

  • The UK Department for International Development provided UK£21 million grants;
  • The Ford Foundation provided US$0.5 million to improve reproductive health/safe delivery/rural community health promotion in four provinces;
  • The China Foundation provided US$2.35 million to support feasibility testing of geothermal energy supply in township health centers in five provinces;
  • The Global Environment Facility provided a grant of US$750,000 for passive solar hospital heating in remote areas of three poor counties;
  • ORBIS International provided Chinese RMB 0.4 million for cataract treatment in Shanxi;
  • The Rockefeller Foundation provided US$50,000 for a gender equity study in Gansu province;
  • The Swedish International Development Cooperation Agency provided US$100,000 to support analysis of gender issues and equality of access to care in the Guizhou Province; and
  • The Japan Social Development Fund provided US$0.4 million for a pilot on increasing service accessibility of rural poor.

Toward the Future

Building on the success of this project, the China Rural Health Project was launched in 2008. The project is testing ideas for rural health reforms and suggesting workable models that could be incorporated into national health policy reforms. The new project focuses on three reform areas:

  • Improving rural health financing by piloting strategies to reach universal coverage;
  • Improving quality, efficiency, and cost control in service delivery by focusing on improving provider performance in rural primary care; and
  • Strengthening the financing and organization of core public health functions by improving existing public health services and by piloting new interventions.

For more information, please visit the Projects website.