Wuzhou Model Upgraded: Direct Medical Insurance Settlement for Chronic Disease Prescriptions at Shared-Platform Pharmacies Officially Piloted
VCBeat (WeChat ID: vcbeat) has learned that on July 5, Wuzhou City officially launched the direct settlement of chronic disease medical insurance pooled accounts at prescription-sharing pharmacies. Relying on the Yifuzhen third-party prescription sharing platform, Dashenlin Pharmacy and Wuzhou Baixing Pharmacy, as the first batch of out-of-hospital pharmacies, signed agreements with the Wuzhou Social Security Bureau and were formally integrated into the medical insurance pooled account system. Patients with chronic diseases can now settle their payments directly after obtaining prescription renewals and purchasing medications at these participating pharmacies.
Launch Ceremony for Direct Settlement via Wuzhou City’s Chronic Disease Medical Insurance Pooling Account at Pharmacies on the Prescription Sharing Platform (Photo provided by the company)
“The New Healthcare Reform” prioritizes the achievement of “tri-sector coordination among healthcare, medical insurance, and pharmaceuticals,” with prescription outflow serving as a key pathway to realize this integration. The model of prescription outflow is straightforward: it shifts the dispensing of prescriptions, traditionally conducted within hospitals, to external settings, where distribution enterprises or community pharmacies assume responsibility for prescription fulfillment.
From the perspective of national policy, the outflow of prescriptions is an irreversible trend. Since 2013, the key tasks for deepening the reform of the medical and healthcare system have consistently included the provision that “patients shall not be restricted from purchasing medications outside hospitals based on their prescriptions.” In addition, cities such as Xi’an, Chengdu, and Chongqing have successively launched pilot programs for “electronic prescriptions,” whereby retail pharmacies integrate with medical institutions to obtain electronic prescriptions and fulfill prescription dispensing.
However, in practice, there are still many challenges to overcome regarding the outflow of prescriptions. For instance, issues related to prescription sources must be addressed: how to ensure the authenticity of prescriptions and their information, prevent duplicate medication purchases, promote rational drug use, and achieve full-process traceability. Secondly, there is the issue of medical insurance pooling. The pooling mechanism tests the rational utilization of medical insurance funds, requiring measures to prevent practices such as overprescribing and insurance fraud. Finally, there is the issue of pharmaceutical care service capabilities in pharmacies. It is essential to determine whether pharmacies can guarantee drug supply and provide professional services, and a reasonable evaluation process is needed to decide which pharmacies should be granted access to externalized prescriptions.
Third-party prescription sharing platforms represent the best practice for prescription outflow. By interfacing with hospitals through these platforms, prescriptions can be obtained while ensuring patient authenticity, prescription information accuracy, and safe, controllable medication use. Furthermore, retail pharmacies can be screened to enable those that truly meet patients’ medication needs and provide professional pharmaceutical care services to handle out-of-hospital prescription dispensing.
Yi Fuzhen, a subsidiary of Baiyang Pharmaceutical Group, launched China’s first third-party prescription-sharing platform in Wuzhou, Guangxi, in May 2017, becoming the country’s first implementable pilot for prescription information sharing. It has gradually developed a mature model for prescription outflow, creating the “Wuzhou Model” for prescription outflow.
The “Wuzhou Model” is characterized by the establishment of an efficiently connected system among hospitals, medical insurance providers, pharmacies, and patients, leveraging the Yifuzhen third-party prescription sharing platform. This model helps alleviate operational pressure on hospital pharmacies while bringing convenience to patients, particularly those with chronic diseases. As a result, the “Wuzhou Model” has gained consistent recognition from both regulatory authorities and patients.
After more than a year of operation, the Yi Fuzhen third-party prescription sharing platform has established the “gold standard” for prescription outflow.
Ma Guanglei, Deputy Secretary-General of the China Pharmaceutical Commercial Association and General Manager of Yi Fuzhen, stated to VCBeat that the Wuzhou Model is highly replicable. This strong replicability is mainly reflected in three key characteristics of third-party prescription sharing platforms: First, the model is fully supported by policy frameworks, ensuring its legality. Second, it demonstrates a high level of professionalism, with relatively comprehensive capabilities in information technology, service delivery, and regulatory oversight. Third, it achieves a win-win outcome for multiple stakeholders: it enables hospitals and governments to monitor the rational use of medicines, provides patients with convenient and accessible channels for purchasing medications, and offers pharmacies a compliant mechanism to fulfill out-of-hospital prescriptions, thereby improving the marketing efficiency of prescription drugs and reducing transaction costs.
Recently, the Wuzhou Human Resources and Social Security Bureau of Guangxi Zhuang Autonomous Region officially launched the trial implementation of the “Notice on Issues Concerning the Trial of Direct Settlement of Outpatient Special Chronic Diseases under Medical Insurance at Prescription-Sharing Pharmacies (Draft for Comments)” (hereinafter referred to as the “Draft Notice”).
"The Draft Opinion" states that the direct settlement of special chronic diseases in outpatient medical insurance at prescription-sharing pharmacies will be piloted starting from July 1, 2018. Prescription-sharing pharmacies that have signed medical insurance service agreements with designated medical institutions in Wuzhou City can directly settle expenses for special chronic diseases covered by outpatient medical insurance. The portion payable by insured individuals shall be settled directly between the insured and the pharmacy, while the portion covered by the pooled fund shall be settled between the medical insurance agency and the pharmacy.
The latest upgrade to the “Wuzhou Model” is primarily reflected in two aspects. First, a reasonable and controllable online follow-up consultation and prescription process has been established. Leveraging the Yifuzhen third-party prescription sharing platform, patients can voluntarily upload prescription codes from within the past two months. Hospitals can then access the patient’s medical information and records based on this data as the basis for follow-up consultations, thereby enabling authentic and secure online prescription renewals for chronic diseases. Second, the pooled insurance fund account has been formally opened to retail pharmacies. As most chronic disease patients require reimbursement through the pooled insurance fund, the integration of the first batch of prescription-sharing pharmacies with the medical insurance system allows patients to more conveniently access extended hospital services and out-of-hospital medication purchasing services.
Huachuang Securities’ research report points out that, under the overarching trend of prescription outflow, if out-of-hospital sales of prescription drugs in China could reach U.S. levels—where out-of-hospital prescription sales account for 45% of total prescription sales—an additional RMB 300 billion in out-of-hospital prescription revenue would be generated. This incremental volume would primarily be absorbed by retail pharmacies and the “third terminal” (grassroots medical institutions). The broad trend of prescription outflow will drive up the overall growth rate of the pharmaceutical retail industry.
Faced with the vast prescription drug market, pharmaceutical manufacturers, distributors, and retailers have made numerous attempts, including DTP (Direct-to-Patient) pharmacies, the “Internet +” new retail model for pharmaceuticals, and third-party prescription information platforms.
Industry insiders believe that the optimal model for accommodating the outflow of prescriptions is a combination of third-party prescription-sharing platforms and retail pharmacies. First, the large number of retail pharmacies ensures maximum patient coverage. Second, market concentration in the retail pharmacy sector continues to rise, with the chain store rate exceeding 50%, which facilitates refined industry management and enhances service capabilities. Finally, innovative technological tools and platforms empower retail pharmacies, enabling their drug supply and pharmaceutical care services to meet the demands associated with prescription extension.
Among these, third-party prescription-sharing platforms that facilitate easy follow-up visits have demonstrated the effects of coordinated reform across medical care, health insurance, and pharmaceuticals after one year of exploration and practice. Taking Wuzhou Red Cross Hospital as an example, outsourced prescriptions accounted for approximately 11% of all prescriptions issued by the hospital. Following the upgrade of the “Wuzhou Model,” pharmacies on the prescription-sharing platform can apply to pilot direct settlement of outpatient special chronic diseases under medical insurance, which is expected to further increase the proportion of outsourced prescriptions.
Yifuzhen, a third-party prescription sharing platform, has undertaken extensive efforts to regulate and oversee partner pharmacies. Strict access standards are enforced for pharmacies across multiple dimensions, including IT systems, branding, hardware, inventory, and service requirements. Preventive measures are in place to identify and promptly address non-compliant operations by pharmacies or individuals. The admission criteria are jointly established by hospitals and Yifuzhen. Pharmacies may apply for onboarding on a voluntary basis and undergo joint verification by both hospitals and Yifuzhen. Pharmacies that fail the verification process are not permitted to join the prescription sharing platform.
Yu Huaijun, Vice President of Dashenlin Pharmaceutical Group Co., Ltd., stated that the opening of pooled insurance accounts has imposed higher requirements on pharmacies participating in prescription-sharing platforms. Such pharmacies must possess strong financial capabilities (including the ability to advance medical insurance funds for insured patients and secure price advantages through cash purchases), adhere strictly to Good Supply Practice (GSP) standards for standardized management, and cooperate with medical insurance authorities and hospitals to enable full-process supervision of medical insurance card transactions. Only by meeting these criteria can pharmacies ensure that the prescription-sharing process is both procedurally controllable and outcome-controllable.
Ma Guanglei concluded by stating that the outflow of prescriptions tests the technical, service, and industrial capabilities of pharmacies and platforms. Yifuzhen will work together with numerous partners, including hospitals, pharmaceutical companies, and pharmacies, to continuously explore and refine the “Wuzhou Model.” By adapting to local conditions, it aims to assist provinces and cities at all levels in completing healthcare reforms, achieving “three-medical linkage,” and ultimately delivering convenient, people-centric services.