Understanding medical corruption in China: a mixed-methods study

Abstract

Medical corruption is a significant obstacle to achieving the health-related Sustainable Development Goals. However, the understanding of medical corruption is limited, especially in developing countries. As the largest developing country, China is also plagued by medical corruption. By employing a mixed-methods design and combining data from three resources, this study attempts to examine patterns of medical corruption in China, explore its key drivers, and investigate the perceived effectiveness of recent anti-corruption interventions. Using extracted data from 3,546 cases on the China Judgments Online (CJO) website between 2013 and 2019, we found that bribery, embezzlement, and insurance fraud accounted for 68.1%, 22.8%, and 9.1% of all medical corruption cases, respectively. Bribery was the major form of medical corruption. Approximately 80% of bribe-takers were healthcare providers and most bribe-givers were suppliers of pharmaceuticals, medical equipment, and consumables. Using a nationally representative household survey, we further found that the prevalence of informal payments from patients stayed at a low level between 2011 and 2018. In 2018, only 0.4% of outpatients and 1.4% of inpatients reported that they had ever given “red envelopes” to physicians in the past. Finally, we conducted interviews with 17 key informants to explore drivers of medical corruption and investigated the perceived effectiveness of recent anti-corruption interventions in China. Interview results showed that financial pressure and weak oversight were two main reasons for corrupt behaviors. Interview results also suggested that the anti-corruption campaign since 2012, the national volume-based procurement, and the special campaign against medical insurance fraud had reduced opportunities for medical corruption, implying China’s positive progress in combating medical corruption. These findings hold lessons for anti-corruption interventions in China as well as other developing countries.

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

“…Based on previous studies on financial performance (45,46), the following eight enterprise characteristics were selected as control variables: (1) transaction cost (TC), which is equal to the ratio of selling expenses to revenue from the primary business; (2) volatility, which is measured by taking the natural logarithm of the stock's return over the last 250 trading days; (3) financial leverage (Lev), which is the ratio of total liabilities to total assets; (4) return on assets (ROA), which is the net income divided by the total assets; (5) enterprise size (Size), which is measured by taking the natural logarithm of the book value of total assets; (6) book-to-market ratio (BM); (7) ownership concentration (Top10), which can reflect the enterprise's shareholding structure and can be measured by the shareholding percentage of the top ten shareholders; and (8) earnings per share (EPS) of the company's stock. These variables and the data were obtained by manually screening the CSMAR quarterly reports.…”

“…Under the principle that medical institutions sell drugs for profit, pharmaceutical enterprises and medical institutions (e.g., hospitals) have formed an interest community, raising drug prices with the help of kickbacks and bribes. This is not only detrimental to patients' interests, but it is also not conducive to the healthy development of pharmaceutical enterprises (6,7). In these circumstances, Chinese pharmaceutical enterprises lack the motivation to innovate, invest most of their costs in marketing rather than in researching new drugs or optimizing production technologies, and produce drugs with excessive homogeneity (i.e., a large number of similar drugs can be substituted for each other, and there is a lack of quality drugs that stand out), which prevents efficient improvement of their financial performance.…”

Administrative regulation-informed analysis of the developmental path of national volume-based procurement to improve drug accessibility in China

“…High drug prices can prevent many patients from receiving timely treatment, endangering public health and potentially undermining the government’s credibility. Pharmaceutical companies, driven by financial gains, often provide kickbacks to medical facilities that utilize expensive medications, engaging in commercial bribery ( 7 ). These “sales costs” are ultimately funded by patients and health insurance funds.…”

The Public’s Self-Avoidance and Other-Reliance in the Reporting of Medical Insurance Fraud: A Cross-Sectional Survey in China

“…Medical insurance fraud has a vicious impact on the healthcare system and the public interest, it is urgent to combat medical insurance fraud to maintain an effective healthcare system and safeguard the public interest. 8 …”

“…Medical insurance fraud has a vicious impact on the healthcare system and the public interest, it is urgent to combat medical insurance fraud to maintain an effective healthcare system and safeguard the public interest. 8 Currently, the primary method for detecting medical insurance fraud in China is manual detection by governmentorganized experts, supplemented by some machine learning tools. 9 However, influenced by factors such as the interregional use of medical insurance funds and the online settlement of medical expenses, the complexity and invisibility of medical insurance fraud are also increasing, which brings tremendous pressure on the government's anti-fraud work in medical insurance.…”