Mainland authorities will push patients to seek medical treatment locally in a bid to overhaul an overburdened health care system where wide gaps between urban and rural care often mean people travel hundreds of kilometres to seek help in cities.

The State Council said plans included improved access and cutting health care fees so that all patients with serious illnesses would receive treatment within their own county by 2017.

The country's health care reforms could reduce steep charges for its citizens, who often save up large "rainy day" funds in case a family member falls ill. The drive is also a lure for investors and firms betting billions of dollars on China opening up a market set to be worth US$1.3 trillion by 2020.

"We are working hard to ensure that people can get treatment where they are," the State Council said.

China's rural patients will often travel to big cities for treatment.However, the government is facing big challenges in its drive to overhaul the unpopular health care system, which is blighted by crowded hospitals, corruption and simmering tension between patients and staff.

The State Council added that the country would increase training and incentives for rural doctors, reduce public hospitals' reliance on drug sales and ensure insurance schemes for serious illness should cover more than 50 per cent of patients' costs.

A survey last year by researchers at the Chinese Hospital Association, backed by the National Health and Family Planning Commission, found more than 60 per cent of county-level public hospitals did not have enough doctors and nurses.

The survey of 86 hospitals in 30 provinces and municipalities found nearly 9,400 medical workers quit their jobs from 2008 to 2012, with each health facility losing 20 to 30 workers a year.

The unfair health care system in rural areas, including steep medical fees for patients, has also led to public anger.

The State Council said last month that medical insurance would be expanded to cover all critical illnesses for all urban and rural residents by the end of the year and half of all medical costs would be covered by insurance to "more effectively reduce the burden of medical expenses".

A five-year plan was unveiled in March to help overhaul the health care system, including increasing the number of doctors and making better use of technology to boost efficiency.