About 90% of the county hospitals across China are in debt, Xinhua reported.

The Ministry of Health disclosed that the total debt had hit 40.6 billion yuan in 2008, with the average county hospital bearing more than 26 million yuan of debt.

Blind expansion caused the debt, said Fu Tao, a researcher from the Chinese Academy of Medical Sciences. According to Fu, many county hospitals borrow money to build new buildings and introduce sophisticated equipment to attract patients, and it is the patients who have to pay the bill.

To get rid of such a vicious circle and reduce the burden of patients, experts suggest local governments improve their economic compensation mechanism for hospitals, encouraging them to further improve treatment quality and strictly control their sizes.