Summary This article analyses micro‐level interactions in one case study to argue that participation does not necessarily lead to accountability. The case study covers the process of establishment, implementation and evaluation of a village‐based health pre‐payment scheme in a poor village in China. Judged on widely used criteria, the scheme and evaluation activities represent examples of ‘high degrees of community participation’. However, analysis of the process points to the influence that different interests, different channels for voicing interests, and unequal power relations have in determining the outcome of decision‐making processes.