Professor Winnie Yip published an article on Health News (健康报) about DRG reform in China. This article is to comment on the new policy issued by the State Council (on June 28) to deepen the payment reform for basic health services (《国务院办公厅关于进一步深化基本医疗保险支付方式改革的指导意见》). In the article, Professor Yip pointed out that, given hospital’s current capacity, successful implementation still requires additional planning. In the near future, policy makers and hospital management should amass a number of critical managerial capabilities. Specifically, Professor Yip recommended three important areas of system level expertise: (1) cost accounting, (2) strong IT system, (3) supply of ICD coding personnel and relevant training program for them.