Medical and healthcare reform in China over the past three decades has faced various challenges, one of which has been the lack of an ethical spirit in public life. The old moral foundation has collapsed and a new ethical system has not been established. It follows that neither the validity of reform nor public policies derived from that reform have a solid moral and ethical foundation. As the government seeks an effective way of reshaping the national healthcare system in terms of quality and accessibility to keep pace with rapid socio-political and economic transformation, it has to deal with various moral challenges. This essay provides a critical review of healthcare reform in past 30 years, with the shift away from a state-controlled, comprehensive healthcare system. While “fairness” is considered an ethical principle in a socialist systemlike China, it has always been a problem in reality given the huge disparity between wealthy cities and poverty-stricken countryside brought about by differences in economic situations and medical human resources. The reform has been welcomed by many, but it has also led to a decline in the scope and quality of healthcare services in certain regions. Hence, recent healthcare changes have focused primarily on grassroots medical networks, which aim to penetrate lower-tier and remote regions. However, the moral basis for these changes is ambiguous. The essay argues that it is crucial for Chinese scholars, healthcare professionals, and government administrators to think about the moral foundation upon which legal regulations and public policies can be implemented to meet specific needs in China.