This paper examines the establishment of a health care system in Lin Village, Fujian Province, southeast China, under the collective commune organization in 1968, and its transformation since 1978 when the government dismantled rural communal organizations. Based on field data collected in 1984-85, this paper compares the finance, training, and operation of this village-based medical facility during these two time periods. This study also identifies both benefits and problems that may affect the well-being of villagers when collective medicine is turned into individual profit-seeking pursuits.