The profit margin can be anywhere between 20 to 25 percent. If the margin is at 15 percent, the entire amount of money involved would reach 45 billion yuan a year, estimated Chen Zhonghua, a CPPCC member from East China's Zhejiang province, the report said.

During the recent CPPCC session, Dong suggested both inviting a third-party to monitor hospital conduct and introducing standards on the price, purchase and prescription of medicine to curb doctors' abuse of medical expertise to make unnecessarily expensive prescriptions.

In April, China will start a nationwide inspection of the price of medicine and medical services, according to a notice issued on Sunday by several government departments, including the National Development and Reform Committee, ministries of supervision and health and the State Administration of Traditional Chinese Medicine.

The move aims to take stock of the progress made since China started a reform of its medical system in April, 2009. All healthcare providers will face government scrutiny of the prices they have charged for medical services since Jan 1, 2010.

If serious cases of illegal pricing are found, authorities will issue fines of up to five times the money involved.