BEIJING - Basic medical insurance coverage in China's rural areas reached 97 percent in 2011, outnumbering that of urban areas, Health Minister Chen Zhu said on Thursday.

Coverage in urban areas reached 89 percent last year, while national overall coverage reached 95 percent, Chen said at a national work conference, citing records in 2003 when only 55 percent of urban citizens and 21 percent of rural citizens were covered.

Chen attributed the progress to the reform of the country's health care system, which has brought "positive structural changes" in recent years.

In recent years, the country has invested heavily in health care and community-level basic medical services in rural areas, the minister said.

As a result of the reforms, the percentage of total medical costs paid by patients decreased from 60 percent in 2001 to 35.5 percent in 2010, with the government budget and social funds covering the rest, Chen added.

Chen's speech also revealed major objectives and plans for future health care reform.

In terms of financing health care services, Chen cited a four-year campaign against the practice of subsidizing services with drug sales, although this practice remains a key source of income for medical institutions.

"It's crucial to thoroughly carry out the campaign, as such practices have led to higher medication costs and corruption," said Chen.

One of the campaign's pilot programs will be executed in 300 counties this year and is expected to cover all county level hospitals by 2012, according to the minister.

Chen also proposed new solutions for doctor-patient disputes.

Specialized institutions or social organizations should be formed or incorporated to receive and handle disputes, Chen said, adding that third-party mediation and medical liability insurance may also be helpful.