China's Public Hospitals Received RMB 270.5 Billion in Fiscal Subsidies in 2018; 17 Anti-Cancer Drugs Added to National Reimbursement List with Average Price Cut of 56.7%

According to the National Health Commission, in 2018, direct fiscal subsidies from governments at all levels to public hospitals nationwide reached RMB 270.5 billion, and 17 anti-cancer drugs were included in the National Reimbursement Drug List, with an average price reduction of 56.7%.

Zhu Hongbiao, an inspector at the Department of System Reform under the National Health Commission, stated that comprehensive reforms in public hospitals made positive progress last year. Building on the nationwide elimination of drug markups and the simultaneous adjustment of medical service prices in 2017, 19 provinces further adjusted medical service prices in 2018, thereby further improving the new compensation mechanism for public hospitals. Regions such as Shandong, Guangdong, and Fujian have specified annual price adjustments once a year to establish a dynamic adjustment mechanism. Places like Sanming City in Fujian Province and Nanchong City in Sichuan Province have introduced pharmaceutical care service fees to reflect the value of pharmaceutical services and promote rational drug use.

Direct fiscal subsidies from governments at all levels to public hospitals nationwide increased from RMB 84.9 billion in 2010 to RMB 270.5 billion in 2018, representing an average annual growth rate of 15.6%. Chengdu, Sichuan Province, quantified and substantiated six government investment policies for public hospitals and incorporated them into the regular fiscal budget. Public hospitals in Beijing, Shanghai, Tianjin, and other regions have no development-related construction debt, while seven provinces, including Anhui and Guizhou, have frozen, separated, and resolved such debts incurred by public hospitals.

Regarding the reform of medical insurance payment methods, 294 cities have implemented diagnosis-related group (DRG) payment for more than 100 disease types. Guangdong Province has comprehensively rolled out the Big Data Diagnosis-Intervention Packet (DIP) payment system, utilizing big data technology to determine the point values and relative weights for 4,051 disease types, and incorporating day surgeries and eligible outpatient preoperative examinations into the scope of DIP payment.

Imported anti-cancer drugs are now tariff-free. Seventeen anti-cancer drugs have been included in the National Reimbursement Drug List, with an average price reduction of 56.7%. Pilot programs for state-organized centralized drug procurement and usage have been launched in 11 cities, resulting in an average price drop of 52% for the 25 selected drugs.

In addition, public hospital reforms have also made positive progress in personnel compensation systems and hospital management.

Shandong, Guangdong, Ningxia, and other regions have implemented headcount-based management for personnel. Staff within the approved headcount are subject to integrated human resource management policies for public institutions and uniformly participate in the old-age insurance scheme for public institutions. More than 2,800 public hospitals across China have launched pilot programs for compensation system reform, implementing the “Two Permissibles” policy (permitting healthcare institutions to exceed the current wage control levels applicable to public institutions, and allowing income from medical services, after deducting costs and setting aside various funds as required, to be primarily used for staff incentives), thereby exploring the establishment of a compensation system tailored to the characteristics of the healthcare industry.

Local party committees have all formulated implementation measures to strengthen Party building in public hospitals, providing institutional safeguards for the implementation of the system under which hospital directors assume responsibility under the leadership of the Party committee. Seven provinces, including Jiangsu and Shaanxi, have established Public Hospital Management Committees in all cities and counties (county-level cities) to coordinate the fulfillment of government responsibilities in operating hospitals. Institutions such as Peking Union Medical College Hospital and West China Hospital of Sichuan University have made beneficial explorations in establishing and improving modern hospital management systems.

Article reposted from China.org.cn: http://news.china.com.cn/txt/2019-06/14/content_74885737.htm