That the basic healthcare security net-work now covers all 1.3 billion residents shows what China's healthcare reform has achieved since further reform was initiated three years ago.

The proportion of hospital expenses patients get reimbursed has increased to 70 percent from 54 percent for urban residents and 48 percent for rural residents. The basic medicine system that has been promoted in local county-level hospitals has cut the average cost of hospital treatments by 9.46 percent.

The central government has also invested 43 billion yuan ($6.8 billion) in supporting the renovation and construction of 2,233 county-level hospitals, 6,200 township clinics and more than 25,000 village clinics. At the same time 4.15 billion yuan has been spent in establishing more than 2,000 community clinics in urban areas.

However, the latest case, in which more than 12 hospital heads in Shenzhen are being investigated for taking bribes from pharmaceutical and medical instrument firms, is a sign that delayed or deficient reforms of State-owned hospitals has offset what the healthcare reform has achieved so far, as patients were prescribed expensive medicines and given unnecessary checkups that increased the cost of healthcare.

To plug the loopholes, there needs to be tight supervision both within and outside hospitals to make it difficult for hospital leaders and those directly in charge of medicine procurement to have the final say over which medicines a hospital purchases. A blacklist should be drawn up of those firms that are known or found to have bribed hospitals, so they can be prohibited from doing business.

Furthermore, a detailed study is needed to find out the gap between the revenue of a hospital and the amount of money it needs to support itself when the charges for medicine and checkups are reasonable. Then the government can decide how much money it needs to subsidize a hospital to maintain its role as a public healthcare institution.

The combination of financial support and tight supervision would facilitate healthcare reform.