Tian Si'en, an old farmer in Harbin, capital of northeast China's Heilongjiang Province, never expected he would have part of his huge medical treatment costs reimbursed.

Thanks to a pilot project in a new rural cooperative medical system launched in Hulan of Harbin, 260,000 farmers of the county will have financial aid to help them relieve the heavy burden of medical fees if they confront serious maladies.

Tian, 66, is one of them who became seriously ill, suffering from stomach cancer. He immediately ran up large hospital bills, and became one of the first batch of beneficiaries to receive 10,000 yuan (US$1,200) in reimbursements from the insurance system.

Experiences from the pilot project will benefit the expected establishment of a health insurance system covering all farmers-- some 18 million -- throughout the province.

The pilot project will continue through next year and evaluated in 2006.

If successful, the system is expected to be promoted provincewide by 2010.

For decades, farmers in China have benefited little from the country's healthcare budget, either nationally or regionally.

Farmers in the county can join the system on a voluntary basis, with each farmer paying 10 yuan (US$1.2) annually to join into the system.

Then he or she would receive a 10 yuan subsidy from the State.

The provincial-, county- and village-level governments provide another 10 yuan according to a proportion of 4:3:3.

Reimbursement is determined by the different level of the hospital where farmers seek treatment and the amounts charged for care.

A patient can receive reimbursement once the charges exceed 200 yuan (US$24). The maximum reimbursement is 10,000 yuan (US$1,200).

As one of the most important grain production bases in China, Heilongjiang Province has a very large rural population.

For Harbin, the provincial capital, nearly 55 percent of its population lives in the city's rural areas.

Issues related to farmers have aroused national concerns in recent years.

The province was among the first to be exempt from agricultural taxes in China.

And five counties of the province, including Hulan, were selected as pilot sites for the new medical system.

The local farmers' incomes remain very low in the province, standing at around 3,000 yuan (US$360) this year.

"Most farmers fear falling ill," said Jiang Dequan from the Harbin Municipal Finance Bureau.

"For them, getting sick means going broke," he told China Daily.

Nearly half of the farmers in Hulan have joined in the system, according to the local health bureau.

"The system was welcomed by the older generation and those who often got sick," said Wang Yongshun from the bureau.

"But the young ones believe that it is unnecessary, at least for the time being when they are still strong," he said.

Hulan plans to create a family account number for every family next year.

For those who have not used the money this year, their money would be saved in the account.

"This may make things better," Wang said.

(China Daily December 22, 2004)