Four Key Highlights from the Recently Released National Drug Reimbursement List

On August 20, 2019, the National Healthcare Security Administration and the Ministry of Human Resources and Social Security issued the Notice on Printing and Distributing the National Drug Catalogue for Basic Medical Insurance, Work-Related Injury Insurance, and Maternity Insurance (hereinafter referred to as the “Notice”). The Notice made partial adjustments to the National Drug Catalogue for Basic Medical Insurance, Work-Related Injury Insurance, and Maternity Insurance (hereinafter referred to as the “Drug Catalogue”) and imposed restrictions on the scope of medical insurance coverage for certain drugs. The main contents of the “Notice” are as follows:

The notice states that provincial-level healthcare security administrations and human resources and social security departments shall strengthen guidance, ensure overall coordination, and progressively promote the harmonization of drug management policies for basic medical insurance, work-related injury insurance, and maternity insurance within their respective provinces. For newly listed drugs in the reimbursement directory that have generic equivalents passing the consistency evaluation, as well as for drugs under expiring price negotiation agreements that have generic equivalents, the healthcare security administrations shall, in principle, establish uniform payment standards for both originator drugs and generics that have passed the consistency evaluation, based on the price levels of such generics.

Medical security departments in each pooling region shall, under the guidance of provincial-level medical security departments and based on the affordability and management requirements of the basic medical insurance fund, formulate corresponding reimbursement policies for Class A and Class B drugs listed in the “National Drug Catalogue.” For drugs with specified restrictions on reimbursement scope, detailed rules for audit and reimbursement shall be established, and verification of clinical justification shall be strengthened.

In accordance with the requirements set forth in the “Notice on Issuing the First Batch of National Key Monitoring Catalogue for Rational Drug Use (Chemical Drugs and Biological Products)” (Guo Wei Ban Yi Han [2019] No. 558), jointly issued by the General Office of the National Health Commission and the General Office of the National Administration of Traditional Chinese Medicine, the Fund shall make payments as prescribed only for prescriptions of Chinese proprietary medicines and traditional Chinese medicine decoction pieces issued by physicians with corresponding qualifications. Each pooling region shall establish a system of medical insurance agreement-based physicians and strengthen the verification and management of physicians’ prescribing eligibility.

All regions must strictly enforce the National Drug Catalogue. They are prohibited from independently formulating their own catalogues or using alternative methods to add drugs to the catalogue, nor may they unilaterally adjust the scope of restricted reimbursement for drugs listed therein. Class B drugs that were previously added to provincial-level drug catalogues in accordance with regulations shall be gradually phased out within three years. During this phase-out period, all provinces shall prioritize removing from the reimbursement scope those drugs included in the national key monitoring list.

For ethnic medicines approved for market launch by relevant national authorities, provincial-level healthcare security departments may take the lead, in conjunction with human resources and social security departments, to include them in the fund payment scope of their respective provinces (autonomous regions, or municipalities) based on local fund affordability and medication needs, following a corresponding expert review process. Each province’s adjustments to the coverage of ethnic medicines shall be filed with the National Healthcare Security Administration and subsequently disclosed to the public.

The TCM decoction pieces included in the "Drug Catalogue" are selected through expert review from those with national standards. For other TCM decoction pieces with national or local standards, provincial-level healthcare security departments may lead, in conjunction with human resources and social security departments, to include them within the fund payment scope of their respective provinces (autonomous regions, municipalities) based on local fund affordability and medication needs, following appropriate expert review procedures; however, they shall not add any decoction pieces specified as non-reimbursable in the Catalogue.

For therapeutic hospital preparations approved by the provincial drug regulatory authorities, the provincial healthcare security administration may take the lead, in conjunction with the human resources and social security department, to formulate a catalog of such preparations eligible for reimbursement from the provincial (autonomous region or municipality) medical insurance fund. This process shall be based on local fund affordability and medication needs, follow the appropriate expert review procedures, and restrict the use of these preparations to designated medical institutions in accordance with relevant regulations.

The payment management measures for traditional Chinese medicine (TCM) decoction pieces included in the “Drug Catalog,” ethnic medicines adjusted by each province (autonomous region, municipality), TCM decoction pieces, and hospital preparations shall be formulated independently by the provincial-level medical security departments.

Provincial-level healthcare security departments shall promptly include drugs listed in the “Drug Catalog” within the scope of local centralized drug procurement in accordance with relevant regulations. They shall also timely update and improve the drug database in their information systems based on drug utilization data from medical institutions and retail pharmacies within their jurisdictions, so as to establish a unified national drug database and achieve standardized coding management for Western medicines, Chinese patent medicines, traditional Chinese medicine decoction pieces, and hospital preparations.

All pooled regions shall enhance their intelligent monitoring systems by integrating the management regulations for the "Drug Catalog" with prescription management measures, clinical technical operation standards, clinical diagnosis and treatment guidelines, and guiding principles for clinical drug application issued by relevant departments. The implementation and utilization of the "Drug Catalog" by designated medical and pharmaceutical institutions shall be incorporated into the management and assessment framework of designated service agreements.

The National Healthcare Security Administration will conduct negotiations on the drugs proposed for negotiation, as determined by expert review, in accordance with relevant procedures. Drugs for which agreements are reached shall be included in the scope of payment by the basic medical insurance fund. The specific list and related requirements will be announced separately. In the process of organizing and implementing the Drug Catalogue, all localities shall promptly report any major issues to the National Healthcare Security Administration and the Ministry of Human Resources and Social Security, respectively. This Catalogue shall come into effect on January 1, 2020, and the Notice of the Ministry of Human Resources and Social Security on Issuing the National Drug Catalogue for Basic Medical Insurance, Work-Related Injury Insurance, and Maternity Insurance (2017 Edition) (Ren She Bu Fa [2017] No. 15) shall be repealed simultaneously.