"Lack of professional ethics and poor management are some of the major problems facing Chinese hospitals," Vice-Minister of Health Huang Jiefu said at a national meeting on medical management last year. The country has more than 18,000 hospitals, most of which are non-profit making facilities. But "many of them have abandoned the basic principle of 'serving the people with heart and soul' in recent years" for the lure of the lucre, Huang said.

"Unfair competition and irregularities have messed up the medicine and medical equipment market," Huang said. "There are many small medicine and medical device makers in the country, making it hard to monitor the market."

China has more than 7,000 registered pharmaceutical firms compared to less than 20 in the US. In 2005 alone, the Chinese authorities approved 10,008 new types of medicines, about 100 times more than the developed countries.

"The dearth of government funds is partly to blame for the unhealthy way in which some hospitals have developed, and the irregularity in the medicine and medical equipment market has worsened the situation."

About 93 percent of the income of hospitals in the country comes from medical service charges. The rest comes from government funds, according to MOH figures.

Since doctors' salaries are directly linked to the sale of drugs under the existing system, many of them have become medicine vendors. And the pharmaceutical firms exploit this situation by offering handsome kickbacks to them if they sell their medicines or devices, which sometimes are sub-standard.

No wonder, stories about astronomical medical bills hit the headlines so frequently. Take Zhu Shaoxia's case as an example. The 78-year-old died of a heart ailment two years ago in Shenzhen People's Hospital in South China's Guangdong Province after being admitted there for four months. Zhu's medical bill amounted to a whopping 1.2 million yuan ($156,000).

His relatives were heart-broken after losing a senior member of the family, but just to make sure everything was okay with the bill they decided to check it. To their horror, the bill was full of weird entries. For instance, doctors had drawn blood from Zhu 26 times in one single day, a feat that could not be explained. As if that was not enough, there were 15 entries for different treatments, including an electrocardiography after Zhu had been declared dead by the doctors.

Health authorities probed the case and ordered the hospital to pay back a quarter of the charges to Zhu's relatives.

The hospital seems to have a knack for the impossible. Late last year, it sent a bill to a patient surnamed Sun, which showed he had received medical treatment for 27 hours a day.

Hospital president Zhou Hanxin was removed from his post earlier this month after the media exposed the over-billing and weird cases.

But the number of such cases is expected to decline once the MOH enforces the Prescription Management Regulation from May 1. The regulation will make it mandatory for all hospitals to set up a prescription appraisal system and delink medical workers' income from prescriptions. Improper prescriptions will be published in a public bulletin to regulate doctors' behavior. Also, to ensure more transparency, all the prescriptions have to have the common names of the drugs, instead of just the chemical ones.

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