Effects on the medical revenue of comprehensive pricing reform in Chinese urban public hospitals after removing drug markups: case of Nanjing

Tang, Wenxi; Xie, Jingcong; Lu, Yijuan; Qi-zhi, Liu; Malone, Daniel C.; Ma, Anlin

doi:10.1080/13696998.2017.1405817

Cited by 24 publications

(24 citation statements)

References 25 publications

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“…We excluded 25 records that did not meet our inclusion criteria. Nine studies (included time series study, retrospective cohort study, and quasi-experimental study) were included in this systematic review [1][2][3][4][6][7][8][9][10]. The characteristics of the included studies are summarized in Table 3.…”

Section: Characteristics Of the Included Trialsmentioning

confidence: 99%

“…In addition, He et al (2018) showed the results that pharmaceutical reform could not reduce total health expenditure in long term [3]. There was a statistical significantly positive correlation between the rate of services compensation and the proportion of medical service revenue [1]. However, Mao et al (2019) concluded that no significant change of the average medical expenditure per prescription was observed [10].…”

Section: Total Expensesmentioning

confidence: 99%

“…In 1954, Policy on Drug Markups (PoDM) announced by Chinese government granted medical institutions to raise pharmaceuticals price by maximum to 15% cap [1]. Since 1980s lacking enough fiscal subsidy and facing raised drug price, patients were struggling with health care [2].…”

Section: Introductionmentioning

confidence: 99%

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A Systematic Review of Zero-markup Policy for Essential Drugs Effect on Medical Treatment

Liu¹,

Hsu

Liu³

et al. 2020

Preprint

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Objective. This systematic review is conducted to synthesize recent empirical evidence of Zero-markup Policy for Essential Drugs Effect on Medical Treatment in China. Methods. We searched the PubMed, Embase, Scopus, and Cumulative Index to Nursing and Allied Health Literature (CINAHL) for all related studies published from inception to 30 April 2019 without restriction on language. In addition, grey literatures were captured through other sources, such as OpenGrey and Open Access Theses and Dissertations (OATD), to avoid selection bias. Methodological quality were evaluated using the PRISMA statement the Newcastle Ottawa Scale Collaboration tool. Results. Thirty-four full texts were initially searched, but only nine studies met our inclusion criteria. Most of studies indicated the significant reduction for both the total expense and drug expense per visit. Additionally, outpatient and inpatient services indicated increasing trends in annual patient-visits. Conclusions. In conclusion, the available limited, relative low-quality evidence does not support the long-term association between zero-markup policy for essential drugs and reduced medical expenditure. Further longitudinal studies that provide data for hospitals over a wider range of regions would make the economic effects more discursive.

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Section: Characteristics Of the Included Trialsmentioning

confidence: 99%

Section: Total Expensesmentioning

confidence: 99%

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A Systematic Review of Zero-markup Policy for Essential Drugs Effect on Medical Treatment

Liu¹,

Hsu

Liu³

et al. 2020

Preprint

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“…[33] A few existing studies have been conducted to evaluate the impacts of PRDMS-C, after it took effect in different areas in China, such as Sanming [34], Zhejiang [35], Hubei [36,26], Guangxi [37], etc. Most of the studies showed that the reform reduced drug cost whereas its effectiveness in containing medical expenditures was questionable with some unintended consequences [38][39][40][41][42][43]. For example, through the DID approach, Fu et al [34] analyzed the public hospital reform in Sanming and showed that the Sanming model was able to reduce drug cost and total medical expenditures without measurably sacrificing the quality or the efficiency of health service provision.…”

Section: Introductionmentioning

confidence: 99%

“…Despite some previous studies on the effects of PRDMS-C, the fundamental differences between county-level and urban hospitals limited the generalizability of conclusions of those previous studies on county-level hospitals to urban ones. Although several literatures presented preliminary evaluations in urban cities like Nanjing [42], Beijing [43], etc., the conclusions from these studies can hardly reflect countrylevel effects of the reform in general as the evidence from the selected locations can hardly be generalized to other areas with different economic and health development background.…”

Section: Introductionmentioning

confidence: 99%

The impacts and unintended consequences of the nationwide pricing reform for drugs and medical services in the urban public hospitals in China

Zhang

Lai

Zhang

et al. 2020

Preprint

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Background Since 2015, China has been rolling out the pricing reform for drugs and medical services (PRDMS) in the urban public hospitals in order to reduce drug expenditures and to relieve financial burdens of patients. This study aims at evaluating the effectiveness of the reform and investigating its positive impacts and unintended consequences to provide evidence basis for further policy making.Methods The Difference-in-difference (DID) approach was employed to analyze the reform impacts on the 31 provincial administrative areas in China based on data abstracted from China Statistics Yearbooks and China Health Statistics Yearbooks from 2012 to 2018.Results The reform resulted in a decrease of 7.59% in drug cost per outpatient visit, a decrease of 5.73% in drug cost per inpatient admission, a decrease of 3.63% in total cost per outpatient visit and an increase of 9.10% in surgery cost per inpatient admission in the intervention group. However, no significant change in examination cost was found. The reduction in the medical cost per inpatient admission was not yet demonstrated, nor was that in the total outpatient/ inpatient expenses. The nationwide pricing reform for drugs and medical services in urban public hospitals (PRDMS-U) in China is demonstrated to be effective in cutting down the drug expenditures. However, the revealed unintended consequences indicate that there are still significant challenges for the reform to reach its ultimate goal of curbing the medical expenditures.Conclusion We conclude that the pricing reform alone may not be enough to change the profit-driven behavior of medical service providers as the root cause lies in the unchanged incentive scheme for providers in the service delivery. This holds lessons for policy making of other low- and middle-income countries (LMICs) with similar health systems set up in the achievement of Universal Health Coverage (UHC).

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Pricing of medical services and channel selection strategies for pharmaceutical supply chain under the zero‐markup drug policy

Li,

Kong

et al. 2024

Manage Decis Econ

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This paper studies the channel strategies of drug suppliers in the drug supply chain under the zero‐plus drug pricing policy. With the popularity of e‐commerce and online shopping, supply chain firms have begun considering expanding their business to online channels. In this paper, we construct a game model to explore the impact of the pharmaceutical supply chain's development of online channels on supply chain members. We conclude that under the zero profits policy, increasing the public hospital's public welfare level will increase the price of drugs, decrease the price of medical services, and reduce the overall cost of patients. In addition, the greater the sensitivity of medical services, the lower the likelihood that a drug supplier will open an online pharmacy, and the lower the level of public good, the greater the likelihood that a drug supplier will open an online pharmacy. In addition, under certain conditions, patients can receive a higher level of medical service and spend less on healthcare under a dual‐channel strategy. Finally, under a dual‐channel strategy, an appropriate profit‐sharing mechanism can eliminate instability in the pharmaceutical supply chain.

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Effects on the medical revenue of comprehensive pricing reform in Chinese urban public hospitals after removing drug markups: case of Nanjing

Abstract: Nanjing's reform represents successful pricing and compensation reform in Chinese urban public hospitals. It is recommended that a differentiated and dynamic compensation plan should be established in accordance with the revenue structure of different hospitals.

Cited by 24 publications

References 25 publications

A Systematic Review of Zero-markup Policy for Essential Drugs Effect on Medical Treatment

A Systematic Review of Zero-markup Policy for Essential Drugs Effect on Medical Treatment

The impacts and unintended consequences of the nationwide pricing reform for drugs and medical services in the urban public hospitals in China

Pricing of medical services and channel selection strategies for pharmaceutical supply chain under the zero‐markup drug policy

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