A master plan for healthcare over the next decade was unveiled Monday, the first step in a highly anticipated reform of the medical system that aims to provide fair and affordable services for all citizens.

The Central Committee of the Communist Party of China and the State Council, or the Cabinet, jointly issued the guidelines after more than two years of debate and revision.

By 2020, the country will have a basic healthcare system providing "safe, effective, convenient and affordable" health services for urban and rural residents, they said.

The guidelines will be supplemented by a more detailed plan covering the next three years.

The State Council had announced earlier this year that more than 850 billion yuan ($124 billion) would be spent by 2011 to provide universal medical services to the country's 1.3 billion residents.

The latest plan identified public hospitals as the dominant providers of health services, with priority given to the development of grassroots-level hospitals and clinics in cities and rural areas.

The government also plans to set up different medical insurance systems to provide some sort of coverage to urban employees, urban residents who do not work and rural residents.

The medicine supply system will be streamlined so that public hospitals and clinics are supplied with essential drugs at prices regulated by the government.

The authorities have also pledged to build 2,000 county hospitals and 5,000 township clinics in rural areas in the next three years, extending medical services and making them more affordable.

There were nearly 7 million healthcare workers in the country as of last year, with more than 300,000 healthcare institutions nationwide, figures from the Ministry of Heath showed.

Health experts Monday said the guidelines were a step in the right direction to help plug current gaps in the medical system.

Ge Yanfeng, director at the Development Research Centre affiliated to the State Council, told Xinhua that the establishment of a government-guided medical and healthcare system will ensure "fairness and equality" in medical services, as is the norm in most developed countries.

"This is the first time that basic medical services are clearly defined as a public service for all citizens, which is part of essential rights of the people," Li Ling, a professor at Peking University, said.

The latest move will also direct funds to areas where they are needed most, said Zhu Hengpeng, a researcher at the institute of economics at the Chinese Academy of Social Sciences.

"An affordable and accessible healthcare system will no doubt mean people will spend less on seeing a doctor. With such security, some of them will spend more on other things," Zhu said.

The healthcare sector is one of the weak links in the social welfare system that creates a drag on domestic consumption and increasingly serves as a source of discontent.

Faced with poor medical coverage and soaring costs, millions of households are forced to set aside savings in case a family member falls ill, rather than spend.

That has worried the government, which is trying to encourage domestic consumption as a way of boosting economic growth, which has been hit by a dry-up in export orders from key markets in Europe and North America because of the global financial crisis.

In the early decades after the founding of New China in 1949, the State provided basic medical care free to most citizens.

In the 1980s, however, the system was largely dismantled amid economic reforms. Seeing a doctor became far more expensive and the gap between rural and urban healthcare began to grow, undercutting attempts to boost rural incomes.

(China Daily April 7, 2009)