Ask Lemmygrad

From my discussions with some Chinese people, it's that the government found that it wasn't able to adequately meet the needs of the people without taking up a ton of the state's budget (biggest population) causing issues like inflexibility from planning, so they opened it up to the market, but still under the watch of the state. Like others have said, their insurance is and medical care is very inexpensive compared to western countries, so it's not a big problem.