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Background: Medical litigation represents a growing cost to healthcare systems. Mediation, arbitration, and other alternative dispute resolution (ADR) methods are increasingly used to help solve the disputes and improve healthcare satisfaction. In China, the increasing number of medical disputes has contributed to concern for the safety of physicians and mistrust between physician and patients resulting in ADR processes being established in several provinces in recent years. Our aim was to describe and explain the impact of this new mediation process in the Chinese healthcare system.Methods: Our study investigated mediation practices in China using case-level data from 5614 mediation records in Guangdong Province between 2013 and 2015. We investigated how the resolution success as well as the compensations are associated with the case characteristics using regression analysis.Results: Among the cases analyzed, 1995 (41%) were solved with agreement through mediation, 1030 were closed by reconciliation, 559 were closed by referring to court and 1017 cases were withdrawn after mediation. Five hundred five Yinao cases were solved with the help of mediators on the spot. We find that mediation solved about 90% of medical disputes under present mechanisms, while more police support is needed to cope with Yinao. The average compensation of mediation is CNY60,200 and average length of mediation is 87 days. Longer time taken to reach resolution and more money claimed by patients are associated with lower resolution success rate (p < 0.01) and higher compensation levels (p < 0.01).Conclusion: Our results show the performance of mediation mechanisms in China to help solve medical disputes. ADR plays a role in reducing the need for initiating litigation and may ultimately increase satisfaction with the healthcare system. [ABSTRACT FROM AUTHOR]