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China's rural cooperative medical insurance, initiated in 2003 to offer farmers basic healthcare, has covered more than 80 percent of the country's rural population, China's health minister Chen Zhu said on Wednesday.

"By June 30, about 720 million farmers have joined the scheme, accounting for 82.83 percent of the total rural population," Chen said at a press conference held by the Information Office of the State Council.

Meanwhile, the rural medical cooperatives have expanded to 2,429 counties, county-level cities and city districts, covering approximately 84.87 percent of the country's rural area, Chen said.

"By 2008, we hope the rural cooperative medical insurance could cover all the country's rural areas," Chen said.

The four-year old rural medical insurance is seen by many as a way to help Chinese farmers out of the plight of risking accidents and disease with virtually no medical insurance.

Under the scheme, a participant pays 10 yuan (US$1.3) a year, while the state, provincial, municipal and county governments supply another 40 yuan to the fund.

When rural residents fall seriously ill, they will be able to cover most hospital expenses from the pooled insurance. The rate of reimbursement varies according to different kinds of illness and the actual cost of medical expenses incurred.