4. We will adopt a variety of measures and policies to make medical care more available and affordable. Health is not only the basis of people's wellbeing, but also the foundation for all-round personal development of the people. It is also an essential element for the sustainable economic and social development of the country. The central government has earmarked 31.276 billion yuan for 2007 expenditures for medical care and public health, an increase of 14.536 billion yuan or 86.8% over 2006.

First, we will offer free prevention and treatment of major communicable diseases. We will strive to prevent and treat disease wherever possible and strengthen monitoring and control of diseases wherever we can. We will incorporate legally designated major diseases that can be effectively prevented through inoculation into the national vaccination plan. We will expand free treatment of people with AIDS, tuberculosis or snail fever to include treatment of people with leprosy or other diseases where treatment would be effective. We will strengthen guaranteed funding for prevention and control of major communicable diseases, support training programs to spread knowledge related to prevention and control of such diseases and raise the level of prevention and control. Policy changes will result in the central government replacing local governments as the main source of funding for prevention and treatment of major communicable diseases as stipulated by law. Not only will more patients directly benefit from the new policy but the spread of diseases will also be better controlled and all of society will benefit.

Second, we will accelerate the building of the new type of rural medical cooperative system. Trials of the new system will be expanded in 2007 to more than 80% of the country's counties, county-level cities and city districts, thus basically setting up the new system across the country one year ahead of schedule. The central government will continue to provide a subsidy of 20 yuan per person in rural areas of the central and western regions and give appropriate assistance to the rural population of the eastern region. Subsidies from all local governments will also be increased to 20 yuan per person. In addition, we will continuously improve methods and standardize management to ensure that the rural population truly benefits from the new system.

Third, we will support trials of a basic medical insurance system for urban residents. A pilot project for a basic medical insurance system for urban residents will begin in 2007. The project will gradually incorporate urban residents without regular employment into the basic medical insurance program. Poor urban residents in the central and western regions will receive an appropriate subsidy from the central government to cover insurance fees. In addition, we will expand coverage of the basic medical insurance system for the urban employed and ensure that retirees from SOEs that have closed, gone bankrupt or have financial difficulty can participate in insurance programs so that more people can afford medical service.

Fourth, we will improve subsidized medical care for both urban and rural residents. The central government will increase budgetary allocations in 2007 to improve subsidized medical care in rural areas of the central and western regions, run the trials of subsidized medical care in urban areas, promote standardization and institutionalization of this work in both urban and rural areas, gradually increase the level of subsidized medical care, improve the use and management of funds and ease the financial burden of health care for the poor urban and rural population.

Fifth, we will strive to increase the capacity of health care services at the community and village level. We will increase support for the training of staff for rural and urban community clinics and strive to ensure that all the people working in these clinics receive the training they need by 2010. The funding for these training programs will come mainly from both the central and local budgets. In addition, we will set up a system to ensure funding for health care services in urban communities. Beginning in 2007, the central government will provide a subsidy of 3 yuan per person to urban residents receiving medical treatment from community clinics in the central region and 4 yuan per person in the western region to ensure that urban residents have access to safe, efficient, convenient and fast basic health care services, including health education, disease prevention, general health care services, rehabilitation and family planning.

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18