Abstract: From the historical perspective, this article explores the establishment of the system of state medical insurance in China. The historical period of this establishment was selected due to an abrupt change in the system of medical insurance as a result of creation of the People’s Republic of China – the system of medical insurance changed from private to state-controlled. Prior to 1949, insurance was issued by private companies, then replaced by state medical insurance. This article gives attention to the key points in establishment of the system of medical insurance, as well as examines the main legislative bills that served as the basis for creation of the state insurance system. The author substantiates the idea of the periodicity of the development of China’s system of social medical insurance. The history of development of this system includes three stages: each of which is tightly connected to a specific strategy of socioeconomic development of PRC authority. Attention is also paid to redistribution of resources of the system of medical insurance between a city and a village, which vividly reflects the need for adjustment of the system of medical insurance to China’s rapid industrialization in that chronological period. The author describes the flaws of the system and government actions aimed at their overcoming.

Keywords: industrialization, health insurance system, government regulation, history, China, social security, health insurance, workers, peasants, legal regulation