Pharmaceutical pricing and reimbursement in China: When the whole is less than the sum of its parts

Impact of National Centralized Drug Procurement policy on chemical pharmaceutical enterprises' R&D investment: a difference-in-differences analysis in China

Objective

This study aimed to evaluate the impact of the National Centralized Drug Procurement (NCDP) policy on chemical pharmaceutical enterprises' R&D investment and provide references for improving NCDP policy design and encouraging innovation in the pharmaceutical industry.

Methods

Using the panel data of 102 Shanghai and Shenzhen A-share listed enterprises from 2016 to 2022 under the chemical pharmaceutical classification of Shenwan in Wind database as the research sample, this study developed difference-in-differences (DID) models on bid-winning and bid-non-winning enterprises, respectively, to evaluate the impact of NCDP policy on their R&D investment. In addition, this study tested the heterogeneity of bid-winning enterprises based on the bid success rate, the decline of drug price, and enterprise size.

Results

The NCDP policy could encourage chemical pharmaceutical companies to increase R&D investment, but the low bid success rate and excessive drug price reduction would reduce their R&D enthusiasm, especially for small- and medium-sized enterprises.

Discussion

It is suggested that the NCDP policy should be further improved: first, revise the bidding rule of the NCDP policy and increase the bid success rate so that more enterprises can win bids, and second, to solve the problem of excessive drug price reduction, evaluate the rationality of bid-winning prices, and introduce a two-way selection mechanism between medical institutions and supply enterprises. Integrate pharmacoeconomic evaluation into the NCDP rules to form a benign competition among enterprises. Third, attention should be paid to supporting policies for small- and medium-sized enterprises. By increasing procurement volume, shortening payment time limits, and increasing the proportion of advance payments, enterprises' cash flow shortages can be alleviated, thus achieving fairness and inclusiveness in the implementation of the NCDP policy.

Impact of China's National Centralized Drug Procurement Policy on pharmaceutical enterprises' financial performance: a quasi-natural experimental study

Introduction

In China, the interest relationship between pharmaceutical enterprises and medical institutions has harmed the healthy development of pharmaceutical enterprises. In November 2018, the National Centralized Drug Procurement (NCDP) policy was published. The NCDP policy severs the interest relationship and significantly impacts on pharmaceutical enterprises's financial performance.

Methods

Using the implementation of China's National Centralized Drug Procurement (NCDP) policy as a quasi-natural experiment, this study evaluated the impact of participation in the NCDP policy on pharmaceutical enterprises' financial performance. We developed a difference-in-difference model to estimate the change in financial performance after NCDP implementation, based on financial data on Chinese listed pharmaceutical enterprises.

Results

We found that the bid-winning enterprises' financial performance significantly improved after participating in NCDP. This may be related to lower costs, market share expansion, and increased research and development investment by the bid-winning enterprises.

Discussion

To further promote the high-quality development of pharmaceutical enterprises in China, the government should expand the variety of drugs on the NCDP list (NCDP drugs), while improving the drug patent protection system and the policies to support the bid-winning enterprises.

The reimbursement decision speed for oncology new drugs in China and its determinant factors

Introduction

China has initiated national price negotiations to improve access to innovative drugs. Learning the factors that contributed to the time gap from marketing authorization to reimbursement leads to more clarity to decision-making, which remains under-researched in China.

Methods

We collected new oncology drug approvals that were marketed before 30 Jun 2022, using the Listed Drug Database of the Chinese drug agency. Major information of each approval was obtained from the published review report, including the first approval region (China or the US) and the receipt of expedited review pathways (priority review and conditional approval). The reimbursement lists issued by China National Healthcare Security Administration from 2015 to 2023 were used to determine the reimbursement status of drugs. The duration from marketing authorization to reimbursement was defined as the reimbursement decision speed, and the Cox regression was performed to explore the underlying factors.

Results

A total of 186 oncology approvals were included. More than half of the approvals qualified for reimbursement (110[59.14%]), and the median reimbursement decision speed was accelerated from 540.5 days in the third-round negotiation to 448 days in the seventh-round. Domestic new drugs had a higher probability of being adopted by the Chinese payer than drugs developed by foreign companies (adjusted HR = 3.73, 95% CI 2.42 to 5.75; P < 0.001). Furthermore, new drug applications receiving the regular review pathway were more likely to be reimbursed (adjusted HR = 2.15, 95% CI 1.13 to 4.08; P = 0.020) compared to those approved under the conditional approval pathway.

Discussion

These findings indicate that the Chinese government is actively working toward improving access to new oncology drugs. The faster reimbursement decision speed for domestic drugs might be attributed to their pricing advantages and the regulator's efforts to stimulate innovation in the domestic pharmaceutical industry. However, concerns about the uncertainty in drug benefits can affect the reimbursement decision-making, which suggests the delicate tradeoff between drug accessibility and risk involved in the reimbursement process.

Impact of China's National Volume-Based Procurement on Drug Procurement Price, Volume, and Expenditure: An Interrupted Time Series Analysis in Tianjin

BACKGROUND

National Volume-Based Procurement (NVBP) program has been carried out in China to lower drug prices and reduce patients' medication burden. This study aims to evaluate its impact on drug purchasing in Tianjin city, one of the first 11 cities piloting NVBP in China.

METHODS

Using monthly drug procurement data from Tianjin Medical Purchasing Center between 2018 and 2020, this study identified bid-winning drugs and their alternative drugs in the pilot NVBP, and evaluated the policy impacts on their procurement price (cost of defined daily dose, DDDc), volume (the number of defined daily dose, DDDs), and expenditure, during the first (initiated at April 1, 2019) and second (initiated at April 25, 2020) procurement cycles of pilot NVBP, applying interrupted time series (ITS) analysis. Included drugs were classified into 12 pharmacological subgroups for further analysis.

RESULTS

Decrease in DDDc of NVBP-covered drugs (bid-winning and non-winning drugs) were observed in the first (level change: -CNY 3.878/DDD, P<.001; trend change: -CNY 0.068/DDD, P=.001; relative change: -61.55%) and second (level change: -CNY 0.356/DDD, P=.049) procurement cycles of pilot NVBP, while no significant change was observed for the DDDc of alternative drugs, except for the increase in antidiarrheic and anti-inflammatory/antirheumatic subgroups as more expensive drugs were purchased from new suppliers in the second procurement cycle. The DDDs of bid-winning drugs significantly increased, while decreased for the non-winning original and generic drugs. Procurement expenditure was saved for NVBP-covered drugs (level change: -CNY 7.29×107, P<.001; trend change: -CNY 5.62×106, P<.001; relative change: -62.60%). However, during the second procurement cycle, procurement volume and expenditure of alternative drugs increased significantly in 7 out of 12 subgroups.

CONCLUSION

The pilot NVBP policy in China reduced procurement price, promoted generic substitution, and saved procurement expenditure. However, the increase in procurement price, volume and expenditure of alternative drugs may reveal the significance of regulating healthcare institutions' drug purchasing behavior.

Cost Drivers and Financial Burden for Cancer-Affected Families in China: A Systematic Review

This systematic review examined cancer care costs, the financial burden for patients, and their economic coping strategies in mainland China. We included 38 quantitative studies that reported out-of-pocket payment for cancer care and patients' coping strategies in English or Chinese (PROSPERO: CRD42021273989). We searched PubMed, Embase, Ovid, Web of Science, Cochrane, CNKI, and Wanfang Data from 1 January 2009 to 10 August 2022. We referred to the standards for reporting observational studies to assess the methodological quality and transparent reporting of the included studies and reported the costs narratively. Annual mean medical costs (including inpatient and outpatient costs and fees for self-purchasing drugs) ranged from USD 7421 to USD 10,297 per patient. One study investigated medical costs for 5 years and indicated that inpatient costs accounted for 51.6% of the total medical costs, followed by self-purchasing drugs (43.9%). Annual medical costs as a percentage of annual household income ranged from 36.0% to 63.1% with a metaproportion of 51.0%. The common coping strategies included borrowing money and reduction of household expenses and expenses from basic health services. Costs of inpatient care and self-purchasing drugs are major drivers of medical costs for cancer care, and many affected households shoulder a very heavy financial burden.

Improving access to medicines and beyond: the national volume-based procurement policy in China

Since 2019, the Chinese central government has taken significant steps to centralize national purchasing power and has implemented a pooled procurement system. In this paper, we provide an in-depth analysis of China's National Volume-Based Procurement (NVBP) policy, which represents a unique approach to pooled procurement within the pharmaceutical sector. The primary objectives of the NVBP are to reduce drug prices, enhance access to affordable medications, and improve the overall functioning of the pharmaceutical industry in China. Our analysis delves into the key features of the NVBP, including its centralized procurement system, volume-based procurement approach, and the guaranteed procurement volumes allocated to winning bidders. We also address the challenges and implications associated with the NVBP, such as its impact on the pharmaceutical industry, the sustainability of price reductions, and the importance of striking a balance between price reduction and industry sustainability. Through a comparative analysis, we shed light on the distinct characteristics of China's approach to pooled procurement and its potential ramifications for healthcare policies and practices. By examining the NVBP within the broader context of China's evolving healthcare landscape, we aim to contribute to a deeper understanding of the implications and effectiveness of this unique policy initiative.

The impact of China's zero markup drug policy on drug costs for managing Parkinson's disease and its complications: an interrupted time series analysis

Background

In April 2009, the Chinese government launched Zero Markup Drug Policy (ZMDP) to adjust medical institutions' revenue and expenditure structures.

Objective

This study evaluated the impact of implementing ZMDP (as an intervention) on the drug costs for managing Parkinson's disease (PD) and its complications from the healthcare providers' perspective.

Methods

The drug costs for managing PD and its complications per outpatient visit or inpatient stay were estimated using electronic health data from a tertiary hospital in China from January 2016 to August 2018. An interrupted time series analysis was conducted to evaluate the immediate change following the intervention (step change, β₁) and the change in slope, comparing post-intervention with the pre-intervention period (trend change, β₂). Subgroup analyses were conducted in outpatients within the strata of age, patients with or without health insurance, and whether drugs were listed in the national Essential Medicine List (EML).

Results

Overall, 18,158 outpatient visits and 366 inpatient stays were included. Outpatient (β₁ = -201.7, 95%CI: -285.4, -117.9) and inpatient (β₁ = -372.1, 95% CI: -643.6, -100.6) drug costs for managing PD significantly decreased when implementing ZMDP. However, for outpatients without health insurance, the trend change in drug costs for managing PD (β₂ = 16.8, 95% CI: 8.0, 25.6) or PD complications (β₂ = 12.6, 95% CI: 5.5, 19.7) significantly increased. Trend changes in outpatient drug costs for managing PD differed when stratifying drugs listed in EML (β₂ = -1.4, 95% CI: -2.6, -0.2) or not (β₂ = 6.3, 95%CI: 2.0, 10.7). Trend changes of outpatient drug costs for managing PD complications significantly increased in drugs listed in EML (β₂ = 14.7, 95% CI 9.2, 20.3), patients without health insurance (β₂ = 12.6, 95% CI 5.5, 19.7), and age under 65 (β₂ = 24.3, 95% CI 17.3, 31.4).

Conclusions

Drug costs for managing PD and its complications significantly decreased when implementing ZMDP. However, the trend in drug costs increased significantly in several subgroups, which may offset the decrease at the implementation.

What condition leads to an unreasonable pharmaceutical price? Impact research on the effect of medical service provision on pharmaceutical price regulation based on fuss-set QCA

Given that the pharmaceutical market has experienced severe market failures, it is necessary that we regulate pharmaceutical prices for many countries. Toward ensuring that pharmaceutical price regulation is efficient, this study investigated the antecedents that lead to an unreasonable pharmaceutical price. Based on 33 case-study countries, this study utilized QCA to analyze the conditional configuration of unreasonable pharmaceutical prices from the perspective of medical service provision. The results showed that the causes of unreasonable pharmaceutical prices are configured by medical service provision, especially cost compensation systems and payment mechanism. This study's conclusions contribute to the research on pharmaceutical price regulation and the institution of medical service provision.

Türk İlaç Politikalarına Yönelik Bir Değerlendirme

Türk ilaç sektörü bir yönü ile gelir elde etme, diğer bir yönü ile sağlık harcamalarındaki ilaç harcamalarını kontrol etme amacıyla son dönemde yerli üretime odaklanmıştır. Türk ilaç sektörünün “yerli” üretim odaklı stratejisi üretim ile birlikte maliyette uygunluk ve erişilebilirlik olarak sıralanmaktadır. Sektör, teknoloji ve üretim kapasitesi ile ivme yakalasa da yabancı firmalar ile rekabet alanında istenilen hedefe ulaşamamıştır. Bunun nedenleri ilaç fiyatlarında sabit kur düzenlemesi, araştırma-geliştirme faaliyetlerine odaklanılmaması ve üretim merkezi sayısının azlığıdır. Bu çalışmanın amacı 2011-2018 yılları arasındaki ilaç politikalarının yerli üretim, akılcı ilaç kullanımı, elektronik reçete ve ilaç takip sistemi kapsamında değerlendirmektir. Bu çalışmada yerli-ithal ilaç satışları, sağlık harcamalarında ilaç harcama oranları, insan kaynağı olarak eczacı dağılımı, geri ödeme kapsamı ve kapsam dışı ilaç dağılımı, akılcı ilaç kullanımının mevcut durumu, ilaç takip sistemi ve elektronik ilaç uygulamasına yönelik değerlendirmeler yapılacaktır. Çalışma kapsamında Sağlık Bakanlığı istatistik yıllıklarından elde edilen ikincil verilerin değerlendirilmesini kapsayan bir derleme sunulmuştur. Araştırmada ayrıca konu ile ilgili literatür taramasındaki yayınlar ve ilaç sektörü araştırma raporlarından da yararlanılmıştır. Son yıllarda yerli ürün üretimi ve tüketimi desteklense de ithal ilaç gruplarındaki fiyat baskısı ilaç sektöründe istenilen düzeyde etkiyi sağlamamıştır. Benzer durum etkin olmayan akılcı ilaç politikalarının uygulama alanlarında da görülebilir. Dünyada stratejik öneme sahip ilaç sektörünün katma değer yaratabilmesi ve ülke ekonomisine katkı sağlayabilmesi için ilaç sektörünün sürdürülebilirliğine ve sektörler arası entegrasyonu sağlayan sağlık politikalarına ihtiyaç vardır. 

Improving access to medicines: lessons from 10 years of drug reforms in China, 2009–2020

China initiated its healthcare reform in 2009 to provide accessible and affordable healthcare to all. We summarised China’s drug reforms between 2009 and 2020 using the WHO framework. China has initiated comprehensive drug policies to address different issues, including: (1) issuing or amending major regulations with changes in institutional settings; (2) implementing the marketing authorisation holder system and bioequivalence assessment to improve the quality of drugs; (3) leveraging accelerated market approval and insurance listing to encourage needs-driven innovation and improve the access to new drugs; (4) introducing compulsory licensing to address major public health threats when needed; (5) scaling up the National Essential Medicine Policy and introducing pharmacoeconomic evaluation in National Reimbursable Drug List to promote rational use of medicine and evidence-based selection; (6) applying differentiated pricing strategies and scaling up zero mark-up policies to form a new financing mechanism; (7) adapting bulk procurement and placing strict regulations on the supply chain management to ensure supply and reduce the cost; (8) empowering pharmacists to improve the rational use of medicine; and (9) using procurement and supply chain digital platforms to inform decision and improve efficiency. China’s drug reform has adopted a phased and systemic approach that mobilises multiple policy levers including governance, regulation and financing. Despite the progress, emerging challenges in implementation, coordination and capacity need to be addressed. Cross-cutting lessons from China’s drug reforms include aligning the drug reform with the overall health reforms, adapting a systemic approach that mobilised policy levers and stakeholders and informing policy decision by conducting pilot studies.

The change of drug utilization in China’s public healthcare institutions under the “4 + 7” centralized drug procurement policy: Evidence from a natural experiment in China

Background: Improving drug accessibility and rational drug use are major challenges for China’s healthcare reform. In 2018, the Chinese government introduced a novel nationwide policy of centralized drug procurement for off-patent drugs, focusing on improving drug utilization patterns of public medical institutions.

Objective: To estimate the impacts of the Chinese centralized drug procurement policy (the so-called “4 + 7” policy) on drug utilization in public medical institutions.

Methods: A retrospective natural experimental design and difference-in-difference method were applied using cross-region data extracted from the national procurement database. Eleven “4 + 7” pilot cities (intervention group) and eleven non-pilot provinces (control group) were matched. In addition, “4 + 7” policy-related drugs (n = 116) were selected as study samples, including 25 drugs in the 4 + 7” procurement List (“4 + 7” List drugs) and their alternative drugs (n = 91) that have not yet been covered by centralized procurement policy. Then, the “4 + 7” List drugs were divided into bid-winning and non-winning drugs according to the bidding results, and they were sorted into generic and original drugs. Defined daily dose (DDD) was used to standardize the quantity of drugs used.

Results: In the 1-year procurement period, the overall completion rate of agreed procurement volume reached 191.4% in pilot cities. Owing to policy impact, the consumption increased by 405.31% in bid-winning drugs (β = 1.62, p &lt; 0.001) and decreased by 62.28% (β = −0.98, p &lt; 0.001) in non-winning drugs. The overall use proportion of bid-winning drugs increased from 17.03% to 73.61% with statistical significance (β = 1.48, p &lt; 0.001), and increments were also detected in all healthcare settings, regions, and anatomical therapeutic chemical (ATC) categories (all p-values &lt; 0.05). Generics and originators were detected with 67.53% increment (β = 0.52, p &lt; 0.001) and 26.88% drop (β = −0.31, p = 0.006) in consume volume. The use proportion of generics increased from 59.23% to 78.44% with significance (β = 0.24, p &lt; 0.001), as well as in tertiary hospitals (β = 0.31), secondary hospitals (β = 0.23), and primary healthcare centers (β = 0.11) (all p-values &lt; 0.001). The use proportion of relatively quality-guaranteed drugs (i.e. bid-winning and original drugs) increased from 56.69% to 93.61% with significance (β = 0.61, p &lt; 0.001), and similar increments were also detected in all healthcare settings, regions, and ATC categories (all p-values &lt; 0.05).

Conclusion: Healthcare providers demonstrated good compliance with the “4 + 7” policy in completing contracted procurement volume. Centralized drug procurement policy promoted drug consumption gradually concentrated on bid-winning drugs, generic drugs, and more importantly, quality-guaranteed drugs.

The impact of national centralized drug procurement on health expenditures for lung cancer inpatients: A difference-in-differences analysis in a large tertiary hospital in China

The availability and affordability of medicines remain major health challenges around the world. In March 2019, the Chinese government introduced a pilot National Centralized Drug Procurement (NCDP) program in order to reduce drug prices and improve the affordability of effective and safe medicines. This study aimed to assess the impact of NCDP policy on health expenditures of cancer patients. Using inpatient discharge records from a large hospital in the pilot city, we performed a difference-in-differences design to estimate the change in health expenditures before and after the policy. We found that the implementation of NCDP was associated with a significant decrease in total expenditures (14.13%) and drug expenditures (20.75%) per inpatient admission. There were also significant reductions in non-drug-related expenditures, including a 7.65% decrease in health service expenditures, a 38.28% decrease in diagnosis expenditures, and a 25.31% decrease in consumable material expenditures per inpatient admission. However, the NCDP implementation was associated with a 107.97% increase in the traditional Chinese medicine expenditures. Overall, the study provided evidence that the NCDP policy has achieved its goals of high-quality and affordable healthcare. The drug expenditures of lung cancer patients revealed a continuous decline, and the policy may have spillover effects on other healthcare expenditures. Further studies are needed to evaluate the long-term effects of NCDP on policy-related expenditures and health outcomes.

Changing Characteristics of Pharmaceutical Prices in China Under Centralized Procurement Policy: A Multi-Intervention Interrupted Time Series

Objective: National centralized drug procurement organized by the Chinese government currently represents the largest group purchasing organization worldwide, to establish a reasonable price formation mechanism. This study aimed to evaluate the effects of centralized procurement policy on drug price and price ratio in China.

Method: Monthly drug procurement data of public medical institutions were extracted from the national procurement database, including 11 pilot cities and 36 months from January 2018 to December 2020. Centralized procured INNs (International Nonproprietary Names) (n = 25) and their alternative INNs (n = 96) were selected as study samples. Centralized procured INNs were divided into bid-winning and non-winning products according to the bidding results. Drug price, price distribution, and price ratio were measured. Multi-intervention interrupted time series analysis was performed to estimate the policy impacts in two centralized procurement periods.

Results: The price of centralized procured INNs showed an immediate drop of 44.57% (β = -0.59, p < 0.001) at the policy implementation, among which bid-winning drugs decreased by 61.71% (β = -0.96, p < 0.001). No significant change in the price level or trends was found for non-winning products and alternative drugs in the first-year procurement period (all p-values > 0.05). During the second-year procurement period, alternative drugs in four therapeutic categories detected significant increases in the price level (all p-values < 0.05). The overall coefficient of variation of price distribution exhibited upward trends after policy implementation. Among the most centralized procured INNs, the price ratio between certificated generics (generics that have passed the consistency evaluation) and original drugs declined significantly after policy intervention (p < 0.05), whereas the price ratio between uncertificated and certificated generics increased significantly (p < 0.05).

Conclusion: Chinese government-organized group purchasing resulted in prominent price reduction of bid-winning drugs. The policy observed a short-term “spillover” effect of synergistic price reduction, while the effect wore off after 1-year procurement period. The extremely dispersed price distribution, as well as unreasonable price ratios, requires further effective price regulation means.

Pricing strategies, executive committee power and negotiation leverage in New Zealand's containment of public spending on pharmaceuticals

This paper explores policy mechanisms behind New Zealand's remarkable track record of cost containment in public pharmaceutical spending, contrasting with most other advanced economies. We drew on a review of official policy documents and 28 semi-structured expert interviews. We found that decision making in pricing and reimbursement policy was dominated by a small group of managers at the Pharmaceutical Management Agency (PHARMAC), the country's drug reimbursement and Health Technology Assessment Agency, who negotiated pharmaceutical prices on behalf of the public payer. In formal negotiation over patented pharmaceutical prices these managers applied an array of pricing strategies, most notably, 'bundling' consisting of discounted package deals for multiple pharmaceuticals, and 'play-off tenders', whereby two or more pharmaceutical companies bid for exclusive contracts. The key pricing strategy for generic drugs, in contrast, was 'blind-tenders' taking the form of an annual bidding process for supply contracts. An additional contextual condition on bargaining over pharmaceutical prices was an indirect strategy that involved the cultivation of the PHARMAC's 'negotiation leverage'. We derived two cost containment mechanisms consisting in the relationship between pricing strategy options and various reimbursement actors. Our findings shed light on aspects of the institutional design of drug reimbursement that may promote the effective use of competitive negotiations of pharmaceutical prices, including specific pricing strategies, by specialist public payer institutions. On this basis, we formulate recommendations for countries seeking to develop or reform policy frameworks to better meet the budgetary challenge posed by pharmaceutical expenditure.

Addressing Failures in Achieving Hypertension Control in Low- and Middle-Income Settings through Simplified Treatment Algorithms

Hypertension is the most important risk factor for cardiovascular diseases (CVDs), which are the leading global cause of death. Hypertension is under-diagnosed and under-treated in most low- and middle-income countries (LMICs). Current algorithms for hypertension treatment are complex for the healthcare worker, limit decentralization, complicate procurement and often translate to a large pill burden for the person with hypertension. We summarize evidence supporting implementation of simple, algorithmic, accessible, non-toxic and effective (SAANE) algorithms to provide a feasible way to access and maintain quality care for hypertension. Implementation of these algorithms will enable task shifting to less specialised health care workers and lay cadres, provision of fixed dose combinations, consolidation of the market while retaining generic competition, simplification of laboratory requirements, and lowering costs for health systems and people who incur out of pocket expenses.

Impact of '4+7' volume-based drug procurement on the use of policy-related original and generic drugs: a natural experimental study in China

OBJECTIVE

To evaluate the impact of the first round of the National Centralized Drug Procurement pilot (so-called '4+7' policy) on the use of policy-related original and generic drugs.

METHODS

A retrospective natural experimental design was adopted. Drug procurement data from the China Drug Supply Information Platform database were used, involving 9 '4+7' pilot cities in intervention group and 12 non-pilot provinces in control group. '4+7' policy-related drugs were selected as study samples, including 25 drugs in the '4+7' procurement list and their alternative drugs that have not yet been covered by the policy. '4+7' List drugs were divided into bid-winning and non-winning products according to the bidding results. Included drugs were sorted into original and generic products. Difference-in-difference method was employed to estimate the net effect of policy impact.

RESULTS

After policy intervention, the DDDs (defined daily doses) of '4+7' List original drugs significantly reduced (β=-39.10, p<0.001), while generic drugs increased (β=40.43, p<0.01). 17.08% of the original drugs in DDDs were substituted by generic drugs. Prominent reduction was observed in the monthly expenditure of '4+7' List drugs (¥726.40 million) and overall policy-related drugs (¥654.47 million). The defined daily drug cost (DDDc) of bid-winning original and generic drugs, as well as non-winning original drugs, decreased by 44.44%, 79.00% and 15.10% (all p<0.01), while the DDDc of non-winning generic drugs increased by 64.81% (p<0.001). The use proportion of higher-quality drugs raised prominently from 39.66% to 91.93%.

CONCLUSIONS

'4+7' policy is conducive to generic substitution, drug price reduction and pharmaceutical cost-containment in China. The overall quality level of drug use of the Chinese population increased after policy intervention, especially in primary healthcare settings. However, the increased DDDc of non-winning generic drugs and alternative drugs should draw the importance of further policy monitoring.

Disparities in economic burden for children with leukemia insured by resident basic medical insurance: evidence from real-world data 2015–2019 in Guangdong, China

Background

Pediatric leukemia is the most prevalent childhood cancer in China and incurs heavy economic burden to patients without sufficient insurance protection. Although all Chinese children are obliged to enroll in the national insurance scheme, “Resident Basic Medical Insurance (RBMI)”, the protection may vary among patient subgroups. This study is designed to measure the disparities in economic burden for patients with leukemia under RBMI protection and explore the influencing factors.

Methods

The included patients were aged ≤ 15 and diagnosed with acute lymphoblastic leukemia (ALL) or acute myeloid leukemia (AML, with/without transplantation). They all completed treatment course consecutively in Nanfang Hospital and Zhujiang Hospital from Jan.1, 2015, to Dec.30, 2019, in Guangzhou, China. Their inpatient treatment and insurance settlement data were drawn from the Hospital Information System (HIS) and Insurance Settlement System (ISS). A total of 765 consecutive patients and 14,477 inpatient medical records were included and analyzed. Their insurance status (6 subtypes), economic burden [total cost, out-of-pocket cost (OOP), reimbursement, reimbursement rate (RR)], and cost structures (operation/procedure, blood products, drug, simple treatment) were calculated respectively. Non-normally distributed costs were reported as the median and interquartile range (IQR). Wilcoxon test was used for univariate tests and generalized linear model with log link was used to explore the influencing factors.

Results

The insured patients who were treated in the location of insurance with instant reimbursement reported the highest total cost and reimbursement, while those who seek medical care cross-province with no instant reimbursement reported the lowest total cost and highest OOP payment. In terms of annual change, the total cost of children with leukemia decreased from 2015–2019 with stably increasing reimbursement rate. Blood products and drugs were the major components of total cost, but they decreased annually. Patients who received transplantation and treated across provinces were with a higher economic burden.

Conclusion

The economic burden for children with leukemia decreased overtime under the protection of RBMI, but disparities exist among subtypes. The payer-provider contract on instant reimbursement and drug cost control are effective measures for insurance administrators to curb the economic burdens of pediatric leukemia treatment.

Supplementary Information

The online version contains supplementary material available at 10.1186/s12913-022-07564-8.

Can the Profitability of Medical Enterprises Be Improved After Joining China's Centralized Drug Procurement? A Difference-in-Difference Design

This paper explores the impact of joining centralized drug procurement of China on the profitability of medical enterprises by the difference-in-difference (DID) model. When centralized procurement cannot bring enough cost savings to enterprises, the price competition caused by centralized procurement will lead to the decline of enterprise profits. In the short term, the negative impact of China's drug centralized procurement policy on the net profit of enterprises is not obvious in the year when enterprises win the bid. After the government officially purchases from pharmaceutical enterprises, the negative impact of the drug centralized procurement policy of China on the net profit of enterprises begins to appear gradually. Therefore, the generic drug manufacturers increase R&D investment and have their own heavy products of original drugs as soon as possible to enhance their core competitiveness.

Management of Unruptured Small Multiple Intracranial Aneurysms in China: A Comparative Effectiveness Analysis Based on Real-World Data

Background

Unruptured small aneurysms with a size of <7 mm were often followed conservatively. However, it is unknown whether unruptured small multiple intracranial aneurysms (MIAs) are better to be prophylactically treated or conservatively followed.

Objective

We aim to compare the effectiveness of different strategies regarding their management.

Methods

A decision-analytic Markov model was built over a entire life cycle. The compared strategies include natural history, treat one aneurysm, treat both aneurysms, annual follow-up, biennial follow-up, and follow-up every 5 years. The inputs for the model were obtained from real-world data and related medical literature. Outcomes were measured in terms of quality-adjusted life-years (QALYs).

Results

Treat both aneurysms had the highest effectiveness of 15.36 QALYs and treat one aneurysm had the second-highest effectiveness of 15.11 QALYs. Probabilistic sensitivity analysis with 10,000 iterations showed that treat both aneurysms and treat one aneurysm were optimal in 67.28 and 17.91% of all cases, respectively. One-way and two-way sensitivity analyses showed that the result was sensitive to the proportion of moderate to severe disability after treating two aneurysms, mortality after treating two aneurysms, proportion of moderate to severe disability after treating one aneurysm, and rupture rate of small growing aneurysm. Either treat both aneurysms or treat one aneurysm would be the optimal strategy under most of the circumstances with the variations of these parameters.

Conclusion

For patients with small unruptured MIAs, prophylactic coiling was superior to conservative management and at least one aneurysm should be treated.

Cost effectiveness of screening for intracranial aneurysms among patients with bicuspid aortic valve: a Markov modelling study

OBJECTIVE

Bicuspid aortic valve (BAV) is common and 7.7%-9.8% of patients with BAV have intracranial aneuryms (IAs) which might lead to a devastating subarachnoid haemorrhage (SAH). We aimed to evaluate different screening and follow-up strategies using magnetic resonance angiography for IAs among patients with BAV.

METHODS

A decision-analytic model was built to evaluate the costs and effectiveness of different management strategies from the Chinese healthcare payer's perspective. The evaluated strategies included natural history without screening for possible IAs, regular screening and no follow-up for detected IAs, and regular screening with regular follow-up (Screen strategy/Follow-up strategy). Base case calculation, as well as probabilistic, one-way, and two-way sensitivity analyses, were performed.

RESULTS

According to the base case calculation, natural history had the least cost and effectiveness while Every 5 years (y)/Annual gained the highest cost and effectiveness. Every 10y/Biennial was cost effective when compared with Every 10y/Every 5y under the willingness-to-pay threshold of ¥211 743 (US$30 162). Probabilistic sensitivity analysis showed that Every 10y/Biennial was superior in 88.3% of the cases when compared with Every 10y/Every 5y. One-way and two-way sensitivity analyses proved that Every 10y/Biennial was the dominant strategy under most circumstances.

CONCLUSIONS

Screening for possible IAs among patients with BAV and follow-up for detected IAs would increase the effectiveness. Every 10y/Biennial was the optimal strategy from the Chinese healthcare payer's perspective.

Did the universal zero-markup drug policy lower healthcare expenditures? Evidence from Changde, China

Background

The zero-markup drug policy (also known as the universal zero-markup drug policy (UZMDP)) was implemented in stages beginning with primary healthcare facilities in 2009 and eventually encompassing city public hospitals in 2016. This policy has been a central pillar of Chinese health reforms. While the literature has examined the impacts of this policy on healthcare utilization and expenditures, a more comprehensive and detailed assessment is warranted. The purpose of this paper is to explore the impacts of the UZMDP on inpatient and outpatient visits as well as on both aggregate healthcare expenditures and its various components (including drug, diagnosis, laboratory, and medical consumables expenditures).

Methods

A pre-post design was applied to a dataset extracted from the Changde Municipal Human Resource and Social Security Bureau comprising discharge data on 27,246 inpatients and encounter data on 48,282 outpatients in Changde city, Hunan province, China. The pre-UZMDP period for the city public hospitals was defined as the period from October 2015 to September 2016, while the post-UZMDP period was defined as the period from October 2016 to September 2017. Difference-in-Difference negative binomial and Tobit regression models were employed to evaluate the impacts of the UZMDP on healthcare utilization and expenditures, respectively.

Results

Four key findings flow from our assessment of the impacts of the UZMDP: first, outpatient and inpatient visits increased by 8.89 % and 9.39 %, respectively; second, average annual inpatient and outpatient drug expenditures fell by 4,349.00 CNY and 1,262.00 CNY, respectively; third, average annual expenditures on other categories of healthcare expenditures increased by 2,500.83 CNY, 417.10 CNY, 122.98 CNY, and 143.50 CNY for aggregate inpatient, inpatient diagnosis, inpatient laboratory, and outpatient medical consumables expenditures, respectively; and fourth, men and older individuals tended to have more inpatient and outpatient visits than their counterparts.

Conclusions

Although the UZMDP was effective in reducing both inpatient and outpatient drug expenditures, it led to a sharp rise in other expenditure categories. Policy decision makers are advised to undertake efforts to contain the growth in total healthcare expenditures, in general, as well as to evaluate the offsetting effects of the policy on non-drug components of care.

Impact of zero-mark-up medicines policy on hospital revenue structure: a panel data analysis of 136 public tertiary hospitals in China, 2012-2020

OBJECTIVE

To quantify the overall and dynamic effects of the implementation of the zero-mark-up medicines policy on the proportionate revenue generated from medicines, medical services and government subsidies at Chinese tertiary public hospitals.

METHODS

The revenue data of 136 tertiary public hospitals from 2012 to 2020 and the implementation-time framework of zero-mark-up medicines policy of these hospitals were obtained from the institutional survey of the third-party evaluation of the China Healthcare Improvement Initiative. The study adopted the time-varying difference-in-differences method and combined it with the event study approach to estimate the effects of the zero-mark-up medicines policy.

RESULTS

Following the implementation of the policy, the proportionate medicines revenue decreased by 3.23% (p<0.001); the proportionate medical services revenue increased by 3.48% (p=0.001); and the difference in the proportionate government subsidies revenue was not significant. In the year of implementation, the proportion of revenue generated from medicines decreased by 7.76% (p=0.0148); and that from medical services increased by 8.62% (p=0.0167). The effect of the policy gradually strengthened thereafter. In 2020, the sixth year after some hospitals started the implementation of the policy, the share of revenue generated from medicines decreased the most by 18.43% (p=0.0151), and that generated from medical services increased the most by 15.29% (p=0.0219). The share of revenue generated from government subsidies increased by 2%-5% in the second, third, fifth and sixth years following implementation (p<0.05).

CONCLUSIONS

Although the policy goal of adjusting hospital revenue structure has been achieved, the findings were insufficient to conclude whether the policy goal of establishing a scientific compensation mechanism was met by increasing the price of medical services and government input. Additionally, whether there was an unexpected policy effect requires further analysis.

Effects of Volume-Price Contracts on Pharmaceutical Prices: A Retrospective Comparative Study of Public Hospitals in Hubei of China

Background: Pharmaceutical expenditure has been increasing worldwide. Many countries have attempted to contain the increase through collective bargaining, including in China. In 2015, the Chinese government introduced a new policy to empower regional governments to reduce pharmaceutical prices through its existing tendering system which enables a lower price for products with higher procurement volumes. Xiangyang municipality in Hubei province took a lead in piloting this initiative. Objectives: This study aimed to evaluate the effects of the volume-price contract initiative on pharmaceutical price procured by the public hospitals in Xiangyang. Methods: A retrospective comparative design was adopted. The price of cardiovascular medicines (349 products under 164 International Nonproprietary Names) procured by the public hospitals in Xiangyang was compared with those procured in Yichang municipality in Hubei. A total of 15,921 procurement records over the period from January 2017 to December 2018 were examined (Xiangyang started the volume-price contract initiative in January 2018). Generalized linear regression models with a difference-in-differences approach which could reflect the differences between the two cities between January 2018 and December 2018 were established to test the effects of the volume-price contract initiative on pharmaceutical prices. Results: On average, the procurement price for cardiovascular medicines adjusted by defined daily dosage in Xiangyang dropped by 41.51%, compared with a 0.22% decrease in Yichang. The difference-in-differences results showed that the volume-price contract initiative resulted in a 36.24% drop (p = 0.006) in the price (30.23% for the original brands, p = 0.008), in addition to the therapeutic competition effect (31.61% reduction in the price, p = 0.002). The top 100 domestic suppliers were highly responsive to the initiative (82.80% drop in the price, p = 0.001). Conclusion: The volume-price contract initiative has the potential to bring down the price of pharmaceutical supplies. Higher responses from the domestic suppliers are evident.

The impact of the reference pricing policy in China on drug procurement and cost

High drug costs are putting pressures on health care budgets and posing an obstacle for China to achieve universal coverage. Policies such as the direct price ceiling, and the Essential Medicines Program-with the Zero Markup Drug Policy (ZMDP) one key component-were implemented, coming out with limited evidence for a success. As a benchmark of China's recent health reform, Sanming city initiated the ZMDP in January 2013; and further piloted the first reference pricing (RP) policy in China in September 2014, with the intention to dis-incentivize the use of costly original drugs. In this study, we used hospital-based drug procurement data of 14 drug substances that were subjected to the RP, from four hospitals in Sanming and a neighbouring city Longyan, between 2012 and 2016. Adopting the difference-in-difference (DID) approach, we evaluated the impacts of the RP together with the ZMDP. On the one hand, we found that the ZMDP had no impact on drugs' procurement prices, volumes and costs. While on the other hand, we found that the introduction of RP was not associated with changes in unit prices for the 14 drugs in Sanming. However, the RP pilot was associated with a 25.9% [95% confidence interval (CI), 12.9-37.0%] decrease in monthly drug procurement volumes and a 47.7% (95% CI, 33.7-58.7%) decrease in the total drug costs. In particular, it reduced the procurement volumes of original drugs by 56.8% (95% CI, 47.0-64.7%). Subgroup analyses by hospital level and therapeutic class found similar results. We draw lessons for the Chinese government to experiment RP on a larger scale, considering the development and effective regulation of the generic market. This is a first report on the effects of RP in China, Asia and middle-income countries.

Effects of Chinese medical pricing reform on the structure of hospital revenue and healthcare expenditure in county hospital: an interrupted time series analysis

Background

China has initiated a medical pricing reform to combat the overuse of drugs and relieve the financial burden of patients. This paper aims to analyze the effect of medical pricing reform on revenue structure and healthcare expenditure of county public hospitals in Guangdong province.

Methods

Based on the monthly data from January 2013 to August 2019, we use interrupted time series design to evaluate the effects of medical pricing reform on healthcare expenditure in both outpatients and inpatients. A counterfactual is also established to examine the net effect of the policy.

Results

The proportion of drug revenue decreased from 35 % to 2015 to 29.7 % in 2019, and the revenue from medical services and inspection increased 3.2 and 3 % respectively. Meanwhile, the increasing trend of total expenditure and its main components is slowed down, especially the drug expense and medical consumable expense for inpatients after the Zero Mark-up Drug policy (coefficient = -18.76, p < 0.01; coefficient = -13.41, p < 0.01, respectively). However, the growth of inspection expense for outpatients continues to increase, while the healthcare expenditure for inpatients experiences an instant increase after the Zero Mark-up Medical Consumables policy. In terms of the net effect, most of healthcare expenditure in both outpatient and inpatient experienced a negative net growth from 2015 to 2019.

Conclusions

The medical pricing reform is a valuable attempt in controlling the unreasonable increase of medical expenses. In the meantime, the unexpected increase in inspection expenditure and insufficient compensation from medical service adjustment should draw the attention of the policymakers.

Availability, cost and affordability of selected antibiotics and antiviral medicines against infectious diseases from 2013 to 2019 in Nanjing, China

OBJECTIVES

As economic globalisation develops in-depth, infectious diseases that occur in a country or region no longer remains a regional issue. Antibiotics and antiviral medicines are essential medicines for the therapy of infectious diseases. This study aims to evaluate their availability, cost and affordability of AaAMs against infectious diseases in 41 public hospitals from 2013 to 2019 in Nanjing, China.

METHODS

Data on the availability and price of 17 antibiotics and 6 antiviral medicines in 41 public hospitals were obtained from the Jiangsu Institute of Medicine Information. We adopted the WHO/Health Action International method to measure the availability, cost and affordability of these medicines.

RESULTS

The availability of selected medicines against infectious diseases was relatively low; the median availability of originator brands was near-zero and that of lowest-priced generics during the survey period less than 50%. The total availability of medicines was poor in primary hospitals as compared to secondary and tertiary hospitals. The median daily-defined dose cost of originator brands was expensive (range from 66.11 RMB to 107.83 RMB), whereas that of lowest price generics was fairly acceptable at < 8 RMB. The affordability of most surveyed medicines was reasonable, which showed significant improvement over time, but the daily cost of a few medicines for originator brands exceeded the average daily wage.

CONCLUSIONS

In general, the affordability of medicines surveyed was acceptable, while the availability was too low. There should be a great concern for improving the reserve system of anti-infective medicines in healthcare institutions. Policy should focus on improving the availability of generic drugs in hospitals and encouraging preferentially prescribed.

Drug Utilization and Drug Pricing in the Private Primary Healthcare System in Malaysia: An Employer Price Control Mechanism

Uncontrolled drug pricing in the private healthcare system in Malaysia leads to high drug prices; however, its impact on employee drug utilization and employer reimbursement coverage is unclear. This study examined patterns of drug pricing and drug utilization among employees covered by employer medical insurance. A drug price control mechanism was also devised for the employer to ensure fair benefits to all parties without compromising the quality of patient care. This retrospective study was conducted among International Islamic University Malaysia (IIUM) community members who sought outpatient treatment at the IIUM panel of health clinics serviced by general practitioners from January 2016 to September 2019. Prescription data (drug type, dose, quantity, duration, price, and manufacturer), patient characteristics (age, sex, and diagnosis) and total charges were extracted from the claims database of PMCare, the insurance company managing IIUM medical claims. Patterns of commonly prescribed drugs, drug pricing, profit margins, and total charges per clinic visit were evaluated. Descriptive statistics were used, and all analyses were performed using Stata v15.1. There were a total of 161,146 prescriptions for 10,150 patients in the IIUM community during the study period (48.85% women, mean ± standard deviation; age: 26.33 ± 17.63 years). The most commonly prescribed drug was paracetamol (25.3%), followed by chlorpheniramine (9.46%), cetirizine (7.3%), diphenhydramine (6.13%), loratadine (4.57%), and diclofenac (4.36%). Generic paracetamol (500 mg), which serves as a prime example for details on drug pricing, is commonly charged between Ringgit Malaysia (RM) 5 and 10 for 10 tablets with a profit between 2,400 and 4,900% according to the average cost price of RM 0.20 per 10 tablets. Most patients were charged within the approved coverage limit of RM 45 per clinic visit, with only 2.41% of patients being charged with costs that exceeded this limit. Uncontrolled drug pricing in the private healthcare system in Malaysia indicates that drug prices differ greatly across private healthcare providers most of the prices were charged with high profit margins. Employers may consider a multilayer capping system to prevent inappropriate drug pricing, which will inevitably benefit patients clinically and economically and provide greater patient access to better drug treatment.

The Effects of County Public Hospital Reform on the Consumption and Costs of Antibiotics: Evidence from a Quasinatural Experiment in Jiangsu, China

Background

Overuse of antibiotics is a major driver for rapid spread of antimicrobial resistance worldwide, particularly common in China. The close linkage between hospital revenue and sales of drugs has become the key incentive for overprescription of antibiotics. Since 2009, the Chinese government implemented a series of measures to cut off the link, including removing the markup of drugs, increasing financial subsidies, and adjusting charges for medical service.

Objective

To evaluate the impacts of county public hospital reform on the consumption and costs of procured antibiotics in Jiangsu province.

Methods

A quasiexperiment design was conducted in Jiangsu province where 99 county public hospitals implemented the reform successively in different periods. Of these, 37 county public hospitals implemented the reform since January 2013, which were regarded as the intervention group, and the remaining 62 hospitals were included in the control group. A difference-in-differences (DID) analysis with generalized linear regressions was used on the procurement records of antibiotics from January 2012 to December 2013. Modified Park test was used for family distribution and Box–Cox test for log link. Placebo tests were employed to test the common-trend hypothesis of two groups.

Results

For the intervention group, the average volume of procured restricted antibiotics and injectable antibiotics increased by 24.12% and 2.75% while the costs increased by 19.01% and 9.09%, respectively. The average costs per DDD of restricted and injectable antibiotics were much higher than unrestricted and oral antibiotics. The DID results showed that the reform had a positive impact on the average volume (p = 0.005) and costs (p = 0.001) of nonrestricted antibiotics. In addition, the implementation of the reform was associated with a reduction in volume (p = 0.031) and costs (p = 0.043) of procured oral antibiotics. The reform also contributed to an increase in average costs per DDD of total antibiotics (p = 0.049).

Conclusions

The reform is effective in reducing the consumption and costs of unrestricted and oral antibiotics, but it has failed to reduce the consumption and costs of expensive restricted and injectable antibiotics, leading to increased burden of diseases. It is critical that the health policy initiatives can deincentivize overuse of antibiotics at both hospital and individual physician's levels. The reform should enforce government financial support, improve hospital governance, optimize performance evaluation, and establish specialized management approach for antibiotic use.

Targeting vulnerable groups of health poverty alleviation in rural China- what is the role of the New Rural Cooperative Medical Scheme for the middle age and elderly population?

Background

In light of the health poverty alleviation policy, we explore whether the New Rural Cooperative Medical System (NRCMS) has effectively reduced the economic burden of medical expenses on rural middle-aged and elderly people and other impoverished vulnerable groups. The study aims to provide evidence that can be used to improve the medical insurance system.

Methods

Data were obtained from the 2015 China Health and Retirement Longitudinal Study (CHARLS). The method of calculating the catastrophic health expenditure (CHE) and impoverishment by medical expense (IME) was adopted from the World Health Organization (WHO). The treatment effect model was used to identify the determinants of CHE for rural middle-aged and elderly people.

Results

The incidence of CHE in rural China for middle-aged and elderly people is 21.8%, and the IME is 8.0%. The households that had enrolled in the NRCMS suffered higher CHE (21.9%) and IME (8.0%), than those that had not enrolled (CHE: 20.6% and IME: 7.7%). The NRCMS did not provide sufficient economic protection from CHE for households with three or more chronic diseases, inpatients, or households with members aged over 65 years. Key risk factors for the CHE included education levels, households with inpatients, households with members aged over 65 years, and households with disabilities.

Conclusions

Although the NRCMS has reduced barriers to the usage of household health services by reducing people’s out-of-pocket payments, it has not effectively reduced the risk of these households falling into poverty. Our research identifies the characteristics of vulnerable groups that the NRCMS does not provide enough support for, and which puts them at a greater risk of falling into poverty due to health impoverishment.

Association between provincial income levels and drug prices in China over the period 2010-2017

In the past decade, the Chinese central government has made sweeping reforms to national pharmaceutical policies. However, provincial authorities have retained control over most drug procurement procedures, potentially leading to cross-province differences in drug prices. The objectives of this study were to (i) examine drug price trends in 31 Chinese provinces and municipalities between 2010 and 2017; (ii) evaluate the association between provincial income levels and drug prices over this period; and (iii) compare the results for Chinese state-owned, Chinese private, and multinational pharmaceutical firms. Using publicly available data on procurement prices of the drugs manufactured by the top 30 pharmaceutical firms in China (in terms of revenues), we ran a generalized country-product-dummy regression to compare drug prices across provinces over the study period. We conducted subgroup analyses to test for differences between types of firms. Between 2010 and 2017, drug prices decreased by an average of 23% across the country. The prices of drugs sold by multinational firms dropped by 32% over this period, while the prices of drugs sold by Chinese private firms declined by 28%. By contrast, the drug prices of state-owned firms went up by 11%. There were statistically significant positive associations between drug prices and provincial income levels for the full sample in 2010, 2011, and 2013. There were no significant associations in other years. Several low-income provinces paid higher procurement prices than some high-income provinces for identical medicines, especially in later study years. The lack of association between income levels and prices poses equity concerns and may place a heavier cost burden on the poor. It also suggests that China's pharmaceutical policies may be failing to balance the dual aims of drug affordability and incentives for innovation.

Medical expenditure for patients with hemophilia in urban China: data from medical insurance information system from 2013 to 2015

Background

Hemophilia, a high-cost disease, is the only rare disease covered by basic medical insurance in all province of China. However, very few studies have estimated the medical expenditure of patients with this rare disease Therefore, this study is aimed at evaluating the medical expenditure of patients with hemophilia and identifying its determinants.

Methods

The study population included 450 patients with hemophilia who were extracted from the national insurance database between 2014 and 2016. An independent-sample Kolmogorov–Smirnov test was performed to compare the medical expenditure of patients with hemophilia covered under urban employee basic medical insurance (UEBMI) and urban residence basic medical insurance (URBMI). Quantile regression analysis was conducted to explore the factors that affect the medical expenditure of patients with hemophilia.

Results

The total annual medical expenditure of patients with hemophilia in 2013, 2014, and 2015 had median of ¥7167 (US$ 1156), ¥3522 (US$ 577), and ¥4197 (US$ 677), respectively. The median medical expenditures of patients with hemophilia covered by UEBMI were ¥10,991 (US$ 1773), ¥2301 (US$ 377) and ¥8074 (US$ 1302), those of patients covered by URBMI were ¥4000 (US$ 645), ¥5717 (US$ 937) and ¥3141 (US$ 507) from 2013 to 2015. The differences in the medical expenditure of patients with hemophilia between UEBMI and URBMI from 2013 to 2015 were statistically significant. The number of admissions and the number of hospital days were statistically significant and positive for all quantiles. The types of medical service were statistically significant and negative for 50th quantile, and the reimbursement ratio was statistically significant and positive for 50th and 75th quantiles. (p < 0.05).

Conclusion

The medical expenditure of patients with hemophilia was lower than that of patients with other common rare diseases that were not included in the scope of basic medical insurance reimbursement. It was also observed that the medical expenditure was mainly influenced by the severity of disease, and partly affected by the reimbursement rate.

Relationship between the number of hospital pharmacists and hospital pharmaceutical expenditure: a macro-level panel data model of fixed effects with individual and time

BACKGROUND

The rapid increase in pharmaceutical expenditure (PE) has been a main problem of global healthcare reform for decades. Previous studies demonstrated that pharmacists play an indispensable role in controlling PE, but macro-research evidence is scarce. Exploring the role of pharmacists from a macro-perspective is essential for pharmacy source allocation with an advantage of extensive applicability over regions. This study aimed to explore the relationship between the number of hospital pharmacists and hospital PE and to provide a macro-perspective evidence to curb the increasing PE and decline unnecessary medications.

METHODS

Data were extracted from China Health Statistics Yearbook from 2011 to 2018. A panel dataset with 31 provinces from 2010 to 2017 was constructed. Amongst them, 'Number of hospital pharmacists per 1 million of population' (HLPT) was selected as an independent variable, 'Per visit of hospital outpatient pharmaceutical expenditure' (OTPE) and 'Per capita of hospital inpatient pharmaceutical expenditure' (ITPE) were selected as dependent variables, and 'Number of hospital physicians per 1 million of population' (HLPN) and 'Drug price index' (DPI) were applied as control variables. Fixed-effect panel data analysis was performed to evaluate the relationship between the number of hospital pharmacists and hospital PE.

RESULTS

HLPT had a significant and negative relationships with OTPE (β₁ = - 0.0893, p = 0.0132) and ITPE (β₁ = - 4.924, p < 0.001). Considering the control variables, the significant and negative relationships with HLPT and OTPE remained unchanged (β₁ = - 0.141, p < 0.001; β₁ = - 4.771, p < 0.001, respectively), indicating that an increase in hospital pharmacist per 1 million of population led to a decrease of ¥474 million ($67.4 million) OTPE and ¥902 million ($128 million) ITPE in 2017. Overall, in 2017, an increase of 1 hospital pharmacist led to a decrease of approximately ¥1 million ($142 thousands) hospital PE nationwide.

CONCLUSION

This study confirmed the negative relationship between hospital pharmacists and hospital PE, indicating that hospital pharmacists might play a significant role in controlling PE. Pharmacists were encouraged to participate in more drug-therapy-related activities, such as medication reconciliation.

Impacts of the drug markup reduction policy on hospital expenditures of esophageal cancer surgery inpatients in Shanghai, China

OBJECTIVES

This study aims to evaluate the impacts of the drug markup reduction policy (DMRP) on hospital expenditure of esophageal cancer surgery (ECS) inpatients.

STUDY DESIGN

This study examined the 2014-2016 individual-level data of patients who underwent ECS in five tertiary hospitals affiliated with the University of Shanghai, China. The patients were divided into three groups based on the proportional markup of the drug they received: 15%, 10%, and 5%. The 15% drug markup group was set as the control group to assess the effect of DMRP on patient spending.

METHODS

We compared patient characteristic variables to observe differences among the groups and considered various categories of spending. Absolute growth, relative growth, and overall growth rates were calculated to compare the changes in each type of spending. The rank-sum test and quantile regression were used to assess absolute changes in and the factors influencing total and drug-related expenditure.

RESULTS

We found that drug spending dropped by 17.01% during this period, to a total of ¥6159.28/patient ($970.91), and drug spending as a proportion of total expenditure fell by 8.90 percentage points to 30.92%. However, total spending during this period increased by 6.88% per patient, with an absolute growth of ¥6259.29/patient ($986.67), while out-of-pocket spending increased by 11.27%, to ¥8093.99/patient ($1278.09).

CONCLUSIONS

Overall, the reform had positive effects on the drug-related spending of ECS patients, but cost control measures should be strengthened.

China's New Cooperative Medical Scheme's Impact on the Medical Expenses of Elderly Rural Migrants

Background: With rapid urbanization in China, the scale of elderly migrants from rural areas to urban cities has increased rapidly from 5.03 million in 2000 to 13.4 million people in 2015. Methods: Based on the unbalanced panel data obtained from the Chinese Longitudinal Healthy Longevity Survey, this study investigates the impact of changes to the New Cooperative Medical Scheme (NCMS) on the medical expenditure of Chinese elderly rural migrants by using seemingly unrelated regression models. Results: NCMS coverage for elderly rural migrants rose from 11.83% in 2005 to 87.33% in 2014. The effective reimbursement rate increased significantly from 4.53% in 2005 to 36.44% in 2014, and out-of-pocket/income fell by 50% between 2005 and 2014. The NCMS significantly increased the effective reimbursement rate by 12.4% and out-of-pocket medical expenditure/income by 7.5% during this decade but played an insignificant role in reducing out-of-pocket payments. Conclusions: Policy makers need to promote a two-pronged strategy, which involves controlling the excessive growth of urban medical expenses and continuing to reform NCMS reimbursements for medical treatment, so non-urban resident elderly rural migrants can fully enjoy the welfare benefits of migration and urbanization.

Influence of government price regulation and deregulation on the price of antineoplastic medications in China: a controlled interrupted time series study

BACKGROUND

In October 2012, the Chinese government established maximum retail prices for specific products, including 30 antineoplastic medications. Three years later, in June 2015, the government abolished price regulation for most medications, including all antineoplastic medications. This study examined the impacts of regulation and subsequent deregulation of prices of antineoplastic medications in China.

METHODS

Using hospital procurement data and an interrupted time series with comparison series design, we examined the impacts of the policy changes on relative purchase prices (Laspeyres price index) and volumes of and spending on 52 antineoplastic medications in 699 hospitals. We identified three policy periods: prior to the initial price regulation (October 2011 to September 2012); during price regulation (October 2012 to June 2015); and after price deregulation (July 2015 to June 2016).

RESULTS

During government price regulation, compared with price-unregulated cancer medications (n=22, mostly newer targeted products), the relative price of price-regulated medications (n=30, mostly chemotherapeutic products) decreased significantly (β=-0.081, p<0.001). After the government price deregulation, no significant price change occurred. Neither government price regulation nor deregulation had a significant impact on average volumes of or average spending on all antineoplastic medications immediately after the policy changes or in the longer term (p>0.05).

CONCLUSION

Compared with unregulated antineoplastics, the prices of regulated antineoplastic medications decreased after setting price caps and did not increase after deregulation. To control the rapid growth of oncology medication expenditures, more effective measures than price regulation through price caps for traditional chemotherapy are needed.

Prescribing patterns of encounters in fourteen general practice clinics in rural Beijing: a cross-sectional study

Background

General practice clinics are the main primary care institutions providing ambulatory care in the rural areas of Beijing, rational use of medicines is crucial for the rural primary care system. This study investigated the prescribing patterns of general practice clinics in rural Beijing to provide a baseline for monitoring and promoting the rational use of medicines.

Methods

We performed a cross-sectional study at 14 rural community health service centers in 6 non-central districts of Beijing sampled through a multistage approach, 85 general practitioners were selected from the 14 centers. Total 8500 prescriptions were derived by recording 100 consecutive patients of each the general practitioner. The World Health Organization drug use indicators and an additional indicator were adopted to assess the prescribing patterns.

Results

The median number of medicines per encounter was 2.0 (1.0, 2.0); the percentage of generics and essential medicines prescribed were 97.0 and 58.2%, respectively; the percentage of encounters with antibiotics prescribed was 15.1%; the percentage of encounters with injections prescribed was 3.7%; the percentage of encounters with traditional Chinese patent medicines prescribed was 52.5%; the median duration of consultation time was 6.0 (4.0, 10.0) minutes. The most frequently prescribed medicine was aspirin (low dose, 4.6%). The prescribing indicators were influenced by different patient characteristics, patients with new cooperative rural medical scheme were less likely to be prescribed with ≥3 medicines (OR 0.865), essential medicines (OR 0.812) and traditional Chinese patent medicines (OR 0.631), but were more likely to be prescribed with injections (OR 1.551) in the encounter. Patients with ≥3 problems were more likely to be prescribed with ≥3 medicines (OR 6.753), antibiotics (OR 2.875) and traditional Chinese patent medicines (OR 2.926) in the encounter.

Conclusions

Most indicators in this study showed similar or fair performance in comparison with World Health Organization and domestic reports, except the percentage of medicines prescribed from the essential medicine list. Regular monitoring on the prescription quality of general practice clinics in rural Beijing should be maintained.

Rural-urban disparity in risk exposure to involuntary social health insurance transition in China: An investigation of chronic disease patients' mental health problems

Chronic disease patients have long suffered from mental health problems because of the long-lasting and costly treatments. Although the multilevel social health insurance system in China attempts to provide them with full-fledged health insurance coverage, the increasing prevalence of gig economy unexpectedly disrupts this situation. As the social health insurance system in China is closely associated with employment status, unemployed rural-to-urban migrant workers/regular urban workers have to accept the transition from urban employee basic medical insurance (UEBMI) to new cooperative medical scheme (NCMS)/urban resident basic medical insurance (URBMI). This study investigates the influence of this involuntary health insurance transition on the mental health of chronic disease patients. Empirical results show that the experience of transition from UEBMI to NCMS would significantly deteriorate the mental health of chronic disease patients, while the transition from UEBMI to URBMI would not. Accordingly, chronically ill rural-to-urban migrant workers are vulnerable to the involuntary health insurance transition that further deteriorates their mental health, and the multilevel social health insurance system in China cannot cope well with the emerging phenomenon of frequent employment change in labor market.

THE METHOD OF FORECASTING OF THE INDICATORS FOR DRUG REIMBURSEMENT TO PATIENTS WITH CARDIOVASCULAR DISEASES IN UKRAINE

The aim of the study is to develop a method for forecasting the indicators for drug reimbursement to patients with cardiovascular diseases (CVD) in Ukraine within the framework of the government program “Available medicines”. Materials and methods: materials of the State Statistics Service of Ukraine and medical records of patients with CVD, who were prescribed with medicines according to the government program, were used in the study. Results: according to the method proposed for forecasting the volume of drug reimbursement to patients with CVD under the government program it has been found that Enalapril has the highest indicator – 10916.4 USD thousand in 2019 and 10736.8 USD thousand in 2020. Clopidogrel takes the second position – 12108.13 USD thousand and 11908.24 USD thousand, while Amlodipine occupies the third position – 9105.60 USD thousand and 8955.28 USD thousand. Among the medicines not included in the government program, but prescribed rather frequently the largest forecasting amount required for reimbursement (in case of inclusion in the program) is 18910.55 USD thousand in 2019 and 18598.36 USD thousand in 2020 for Magnicor, and the least amount is 444.55 USD thousand and 437.22 USD thousand for Acetylsalicylic acid, respectively. Conclusions. The government program to provide patients with effective and affordable medicines has a significant impact on reforming the healthcare system of Ukraine. The study conducted can be used to expand the government program in the process of formation and distribution of budget funds.

Impact of public hospital pricing reform on medical expenditure structure in Jiangsu, China: a synthetic control analysis

Background

The synthetic control method (SCM) is a useful tool in providing unbiased analysis on the policy effect in real-world health policy evaluations. Through controlling for a few confounding factors, we aim to apply SCM in analyzing the impact of the pricing reform on medical expenditure structure in Jiangsu Province, China.

Methods

We constructed a synthetic control for Zhenjiang, a city where the reform was piloted in Jiangsu, by selecting weights on those potential control units to define a linear combination of the control outcomes to replicate the counterfactual as if the intervention is in absence. The policy effect was measured by the differences in the percentage of drug expenditure among average outpatient and inpatient care cost per visit in the post-policy period between Zhenjiang and its synthetic control. We also examined the significance of the estimated results by performing placebo tests, and cross-validated the results with a difference-in-differences analysis.

Results

The medical pricing reform was found to be effective in reducing the drug expenditure proportions in both outpatient and inpatient care by an estimated mean level of 7.7 and 3.2% (or 16.3 and 9.2% relative decrease to their 2012 levels) respectively. This reform effect was estimated to be significant in the placebo tests and was further confirmed by a cross-validation.

Conclusion

We conclude that the pricing reform in public hospitals has significantly reduced drug expenditure incurred in both outpatient and inpatient care. This study also highlights the applicability of SCM method as an effective tool for health policy evaluation using publicly available data in the context of Chinese healthcare system.

Multi-Level Social Health Insurance System in the Age of Frequent Employment Change: The Urban Unemployment-Induced Insurance Transition and Healthcare Utilization in China

Job tenure has been significantly shortened with the prevalence of the gig economy around the world. Workers are faced with a new age of frequent employment change. This emerging situation is out of expectation of social health insurance policymakers. As the multi-level social health insurance system in China is closely associated with employment status; urban workers cannot enjoy the urban employee basic medical insurance (UEBMI) during the unemployment period. At this time, unemployed rural-to-urban migrant workers can only rely on the new cooperative medical scheme (NCMS) and unemployed urban residents can only rely on the urban resident basic medical insurance (URBMI). This study provides a preliminary analysis on healthcare utilization change triggered by the unemployment-induced social health insurance transition that has never been investigated. Using the data of a nationwide survey, empirical results show that the unemployment-induced social health insurance transition can significantly deteriorate the healthcare utilization of insurance beneficiaries experiencing the transitions from the UEBMI to the NCMS (or from the UEBMI to the URBMI). Specifically, the outpatient service quality and the conventional physical examination become worse, and the out-of-pocket expenditure increases. Therefore, the multi-level social health insurance system currently in effect can expose workers to a high risk of insufficient health security in the age of frequent employment change.

Taking stock of cost-effectiveness analysis of healthcare in China

Introduction

Cost-effectiveness analysis (CEA) is playing an increasingly important role in informing healthcare decision-making in China. This study aims to review the published literature on CEA in mainland China and describe its characteristics and evolution. We provide recommendations on the future direction of CEA as a methodology and as a tool to support healthcare decision-making in China.

Methods

English-language cost-per-quality-adjusted life-year (QALY) and cost-per-disability-adjusted life-year (DALY) publications relating to mainland China were reviewed using the Tufts Medical Center Cost-Effectiveness Analysis Registry and Global Health Cost-Effectiveness Analysis Registry through 2017. Study features were summarised using descriptive statistics. Changes in study methodology over time were analysed by trend test, and study characteristics influencing the incremental cost-effectiveness ratio (ICER) of cost-per-QALY studies were investigated using logistic regression.

Results

170 studies were identified reporting CEA for mainland China (cost/QALY=125, cost/DALY=45) since 1998. The number and quality of studies has increased over the past two decades, with significantly more cost-per-QALY studies compared with cost-per-DALY studies (p<0.0001) and more studies with authors affiliated with Chinese institutions (p=0.0002). The average quality score was 5.04 out of 7 for cost-per-QALY and 4.70 for cost-per-DALY studies based on Registry reviewers’ subjective assessment of overall quality (methods, assumptions and reporting practices). The median ICER reported for interventions for oncology patients was higher (US$26 694 per QALY) than the median ICER reported for all interventions (US$11 503 per QALY). Oncology interventions were associated with the likelihood of reporting higher ICERs than the median ICER (p=0.003).

Conclusion

The number of English-language published CEA studies relating to China has grown rapidly over the past 20 years. In terms of quality, the China studies compare favourably with international studies, although they remain a small proportion of studies globally.

Government pharmaceutical pricing strategies in the Asia-Pacific region: an overview

Background and objectives: Governments in Asia Pacific (APAC) are increasingly using pharmaceutical pricing strategies to contain rising healthcare costs. The objective of this narrative review is to discuss formal pricing strategies for reimbursed prescription medication in APAC, supported by relevant examples of implementation differences across countries. In the discussion section, we examine key advantages and disadvantages of each strategy. Methods: A narrative review of the peer-reviewed and grey literature was undertaken to retrieve information, including strategy definitions, practising countries, country-specific implementation considerations, and merits and demerits of each strategy. Results: Seven strategies (Internal Reference Pricing, External Reference Pricing, Special Pricing Agreements, Pharmacoeconomic Evaluation, Cost plus pricing, Price Maintenance Premium, and Tendering and negotiations) were identified as most commonly practised in APAC through the review process. Most countries use multiple strategies that differ in how they are implemented. Conclusion: APAC countries use multiple strategies simultaneously with varying implementation methods, including different formulae and sub-types of medication that a strategy applies to, whether the strategy is a mandate or guideline, and the extent of negotiations and transparency. Strategies are instituted partly with the aim of cost containment, and may also promote price stability, innovation, and increased access in the short and longer term. Abbreviations: APAC - Asia Pacific; WHO - World Health Organisation; IRP - Internal Reference Pricing; ERP - External Reference Pricing; SPA - Special Pricing Agreement; MES - Managed Entry Scheme; PVA - Price-Volume Agreement; RSA - Risk Sharing Agreement; NHIS - National Health Insurance System; PE - Pharmacoeconomic Evaluation; CEA - Cost-Effectiveness Analysis; QALY - Quality-adjusted Life Year; BIA - Budget Impact Analysis; PMP - Price Maintenance Premium; R&D - Research & Development.

Making medicines more accessible in China: An empirical study investigating the early progress of essential medicine system

Objective

To assess changes in medicine availability and prices as well as subsequent affordability during the early years of the National Essential Medicine System (NEMS) reform in China.

Methods

Data were obtained from four provinces through a field survey conducted in 2010–2011. Outcome measures were percentage availability, delivery efficiency, ratios of local prices to international reference prices (MPRs), and number of days’ household income needed to purchase medicines. Prices were adjusted for inflation/deflation and purchasing power parity.

Results

Under NEMS, the median MPR for essential medicines decreased from 3.27 times to 1.59 times from 2009 to 2010. The median medicine expenditure under standard treatments in 2010 equaled 1.06 days household income at a low-income level and 0.25 days household income at a middle-income level. A 25.67% reduction was observed in the average number of medicines stocked by primary healthcare facilities in 2011 compared with 2009 and the availability of essential medicines was 66.83%. During 2009–2011, suppliers could respond to 98.24% of the purchasing orders raised by primary healthcare facilities, and 89.32% of the order amounts could be delivered.

Conclusions

The market prices of essential medicines greatly decreased in China after the establishment of NEMS and showed improved affordability in the short term. However, current medicine prices remain high compared to international reference prices. Medicines were often unaffordable for economically backward residents. Future policies still need to target medicine availability as well as affordability.

Effects of County Public Hospital Reform on Procurement Costs and Volume of Antibiotics: A Quasi-Natural Experiment in Hubei Province, China

BACKGROUND

The overuse of antibiotics has become a major public health challenge worldwide, especially in low- and middle-income countries, including China. In 2009, the Chinese government launched a series of measures to de-incentivise over-prescription in public health facilities, including decoupling the link between facility income and the sale of medicines.

OBJECTIVES

We evaluated the effects of these measures on procurement costs and the volume of antibiotics in county public hospitals.

METHODS

The study was undertaken in the Hubei province of China, where 64 county public hospitals implemented the reform in sequence at three different stages. A quasi-natural experiment design was employed. We performed generalised linear regressions with a difference-in-differences approach using 22,713 procurement records of antibiotics from November 2014 to December 2016.

RESULTS

The regression results showed that the reform contributed to a 14.79% increase in total costs for antibiotics (p = 0.013), particularly costs for injectable antibiotics (p = 0.022) and first-line antibiotics (p = 0.030). The procurement prices for antibiotics remained largely comparable to those in the control group, but the reform led to a 17.30% increase in the procurement volume (expressed as defined daily doses) of second-line antibiotics (p = 0.032).

CONCLUSIONS

County public hospitals procured more antibiotics and greater numbers of expensive antibiotics, such as those administered via injection, to compensate for the loss of income from the sale of medicines, leading to an increased total cost of antibiotics.

Health Technology Assessment and Its Use in Drug Policies in China

OBJECTIVE

To review drug policies, health technology assessment (HTA), and HTA's use in drug policies in China, to further improve the quality and efficiency of drugs.

METHODS

This study draws on multiple methods. A systematic review of the literature, review of Chinese government documents and statistical handbooks, and authors' experiences in drug policies and HTA in China were combined to achieve the objective.

RESULTS

Of 571 studies identified in the initial search, 14 eligible articles (6 English, 8 Chinese) were finally included. On the Web site of the National Health and Family Planning Commission, the National Development and Reform Commission, and the Ministry of Human Resources and Social Security, we found that HTA or pharmacoeconomics evaluation is mentioned in recent years and its frequency has been increasing; however, there was not one hit about HTA or PE on the Web site of China Food and Drug Administration.

CONCLUSIONS

The decision makers have realized the importance and value of HTA and have tried to integrate HTA into drug policies and regulations. However, the application of HTA findings to drug policymaking is not yet widespread and there are a number of challenges in using HTA in China. Therefore, it is necessary to establish a national HTA commission and develop pharmacoeconomics guidelines to support the use of HTA in decision making. Moreover, the most important steps are to encourage technology innovation, groom more HTA experts, and build reliable databases in China.

BRIC Health Systems and Big Pharma: A Challenge for Health Policy and Management

BRIC nations – Brazil, Russia, India, and China – represent 40% of the world’s population, including a growing aging population and middle class with an increasing prevalence of chronic disease. Their healthcare systems increasingly rely on prescription drugs, but they differ from most other healthcare systems because healthcare expenditures in BRIC nations have exhibited the highest revenue growth rates for pharmaceutical multinational corporations (MNCs), Big Pharma. The response of BRIC nations to Big Pharma presents contrasting cases of how governments manage the tensions posed by rising public expectations and limited resources to satisfy them. Understanding these tensions represents an emerging area of research and an important challenge for all those who work in the field of health policy and management (HPAM).

Strengthening health technology assessment systems in the global south: a comparative analysis of the HTA journeys of China, India and South Africa

BACKGROUND

Resource allocation in health is universally challenging, but especially so in resource-constrained contexts in the Global South. Pursuing a strategy of evidence-based decision-making and using tools such as Health Technology Assessment (HTA), can help address issues relating to both affordability and equity when allocating resources. Three BRICS and Global South countries, China, India and South Africa have committed to strengthening HTA capacity and developing their domestic HTA systems, with the goal of getting evidence translated into policy. Through assessing and comparing the HTA journey of each country it may be possible to identify common problems and shareable insights.

OBJECTIVES

This collaborative paper aimed to share knowledge on strengthening HTA systems to enable enhanced evidence-based decision-making in the Global South by: Identifying common barriers and enablers in three BRICS countries in the Global South; and Exploring how South-South collaboration can strengthen HTA capacity and utilisation for better healthcare decision-making.

METHODS

A descriptive and explorative comparative analysis was conducted comprising a Within-Case analysis to produce a narrative of the HTA journey in each country and an Across-Case analysis to explore both knowledge that could be shared and any potential knowledge gaps.

RESULTS

Analyses revealed that China, India and South Africa share many barriers to strengthening and developing HTA systems such as: (1) Minimal HTA expertise; (2) Weak health data infrastructure; (3) Rising healthcare costs; (4) Fragmented healthcare systems; and (5) Significant growth in non-communicable diseases. Stakeholder engagement and institutionalisation of HTA were identified as two conducive factors for strengthening HTA systems.

CONCLUSION

China, India and South Africa have all committed to establishing robust HTA systems to inform evidence-based priority setting and have experienced similar challenges. Engagement among countries of the Global South can provide a supportive platform to share knowledge that is more applicable and pragmatic.

The primary health-care system in China

China has made remarkable progress in strengthening its primary health-care system. Nevertheless, the system still faces challenges in structural characteristics, incentives and policies, and quality of care, all of which diminish its preparedness to care for a fifth of the world's population, which is ageing and which has a growing prevalence of chronic non-communicable disease. These challenges include inadequate education and qualifications of its workforce, ageing and turnover of village doctors, fragmented health information technology systems, a paucity of digital data on everyday clinical practice, financial subsidies and incentives that do not encourage cost savings and good performance, insurance policies that hamper the efficiency of care delivery, an insufficient quality measurement and improvement system, and poor performance in the control of risk factors (such as hypertension and diabetes). As China deepens its health-care reform, it has the opportunity to build an integrated, cooperative primary health-care system, generating knowledge from practice that can support improvements, and bolstered by evidence-based performance indicators and incentives.