This is one of the services required by your citizens. Its buildings are found under City services - Health, and consist of various healthcare institutions like clinics and hospitals:
- Health center (1000/mo) - small neighborhood facility
- Clinic (2000/mo) - a larger neighborhood facility
- Medical institute (3000/mo) - a major city health institution
- Hospital complex (5000/mo) - the biggest health institution
The Health center and Clinic have somewhat limited coverage area, and thus are suitable for use only in the beginning stage of a city, or to cover a remote area far from your city center. I've found that couple of Medical institutes and a hospital are more than enough to cover the entire map and turn up almost maximum health satisfation. Of course, try to build them in different parts of the city. Again, an overlay will help you identify the coverage: Satisfaction - Health, with dark green showing perfect coverage, and faint yellow the least effect. You can try experimenting to see what the effect of a new health center would be: click on the building, then hover with it over an area: as soon as it touches a road, the future coverage area will light up in the respective colour, showing you what effect the building will have.