Chen Jun spends a 12-hour day at the wheel of a delivery van and has started to get pain in his shoulder and lower back. He has never had medical insurance, but has decided to start paying for it. 'Government policy caused me to change. Its decision to help with payment for major illnesses persuaded me to spend the 300-400 yuan a month. So if I need a major operation in the future, I'll be able to afford it and my family won't be ruined.' Mr Chen, 35, is one beneficiary of a decision by Zhuhai to become the first mainland city to move towards universal medical care. The new policy, which took effect on Tuesday, provides free treatment for minor illnesses, and government subsidies for major treatments. Zhuhai is a pioneer in sweeping medical reforms that will soon be announced by the State Council after 16 months of intense debate and negotiations. The reforms come in response to public anger at the soaring costs, inequality and corruption of a medical system that has for the past 15 years been market-driven, in which the government pays less than 20 per cent of costs, leaving the patients to shoulder the burden. The new policy will include increased government spending, better care in rural areas, a new system of drug production and distribution and ways to attract funds from all parts of society into health care. As provinces and cities across the mainland wait for the details of the policy, they are watching closely the experience of Zhuhai, a city of 1.4 million that borders Macau. Under the new policy, Zhuhai residents who make an annual payment of 250 yuan will receive 150 yuan from the government, which will include them in the insurance net and make them eligible for free treatment for minor ailments at a designated health centre. The government will help pay for major treatment up to a maximum of 100,000 yuan. The money will come from public donations and social welfare funds as well as the city's budget. For the poor, seriously handicapped and farmers, the minimum insurance premium will be 175 yuan a year, of which the government will pay 150-175 yuan, depending on family income. The main beneficiaries will be the 250,000 people not covered by any state or commercial insurance plan, including the unemployed, the poor, children and farmers. Minor ailments include immunisations for children, check-ups for new babies, diagnosis and treatment of high blood pressure, diabetes, colds, coronary heart disease, respiratory infections and bronchitis, and prevention of tuberculosis and other infectious diseases. In an effort to reduce pressure on city hospitals, people with insurance will be eligible for free treatment only at their district clinics. Zhuhai aims to open 150 rural clinics across the county this year. 'Our aim is a safe, efficient, convenient and low-cost medical service,' said mayor Zhong Shijian, announcing the policy early last month. 'We want to improve the fairness of the public system and build a first line of medical defence for the public. This is not a sweet that we will give then take away.' He said the city would spend an extra 203 million yuan this year to cover the additional costs, of which 104 million will go to pay for free treatment, 36 million for moderate ailments and 18 million for serious conditions. The 203 million yuan means a doubling of health-care spending, which has been less than 200 million a year for the past five years, less than 4 per cent of the city's budget. In Zhuhai the public reaction was positive, especially among the poor and farmers. But many are sceptical about whether the government will be able to meet its ambitious promises, saying that its income is far below that of other cities in Guangdong, such as Guangzhou, Shenzhen, Zhongshan and Foshan . Yet Zhuhai may be able to take the risk because it is a small, rich and young city. In its population of 1.4 million, only 930,000 people have permanent residence status and are covered by the new policy. Its per capita GDP of more than 52,000 yuan is the highest in Guangdong. Set up as a special economic zone in 1980, it is a city of migrants and does not have the medical and pension costs of tens of thousands of retirees that burden big industrial cities elsewhere on the mainland, and which make implementing such a plan impossible. Mr Zhong reported late last month that in the first 11 months of last year, the city's GDP had risen 16.1 per cent year on year, to 80.02 billion yuan, with foreign investment up 43 per cent to reach US$990 million. 'The city's financial position is better and better, with income rising 25.5 per cent in 2007 to a record 7.56 billion yuan,' he said. It was six billion yuan in 2006 and 3.482 billion yuan in 2003. The main sources of revenue are industry, tourism, a deep-water port, a booming property sector, a dozen universities and the spending of the thousands of retirees who have made their homes in the city. On the down side, Zhuhai has heavy debt, the result of grandiose infrastructure projects such as its airport, Formula One racetrack and complex of indoor and outdoor sports stadiums, all underused. Servicing the debt cost 870 million yuan last year, up from 650 million in 2006. Many wonder whether Zhuhai can afford the new policy as it is impossible to quantify the demand. Hua Benliang, head of the business development department at the Zhuhai campus of Jilin University, said property taxes accounted for 2 billion yuan of the city's revenue in 2006, up 57.3 per cent on 2005. 'But the increase in 2007 was only 4.9 per cent,' he said. 'If the property market cools, how can we guarantee the revenue? In addition, many firms enjoy no-tax or reduced-tax status, so that revenue cannot rise sharply.' Liang Yue, a middle-school teacher who has limited cover from a state insurance scheme, said: 'Even the richest countries in the world cannot afford universal health cover. It's a bottomless pit. So I am sceptical about how much Zhuhai can afford. 'Like many people, I dare not think about a serious illness and the exorbitant cost of an operation. It is a financial disaster that can ruin an entire family,' she said. Wang Yiguo, a civil servant, said he was proud of his city being the mainland's first to implement such a reform, but he had reservations. 'The leaders want to improve the quality of life in Zhuhai and make the city more attractive, and to enhance their own reputations,' he said. 'But it does not cut the high costs of drugs nor address the issue of collusion and kickbacks between doctors and drug companies, which are in part responsible for these costs.'