essential medicines and health reform in china
DESCRIPTION
Essential medicines and health reform in China. Ye Lu Ph.D Dept. of Health Economics Fudan University 2011-05-30 Geneva. What is the main problem we are trying to resolve?. Problems in China’s Health System. China’s health system is “sick” and the diagnosis is clear: - PowerPoint PPT PresentationTRANSCRIPT
![Page 1: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/1.jpg)
Essential medicines and health reform in China
Ye Lu Ph.DDept. of Health Economics
Fudan University2011-05-30 Geneva
![Page 2: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/2.jpg)
What is the main problem we are trying to resolve?
![Page 3: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/3.jpg)
3
Problems in China’s Health System
• China’s health system is “sick” and the diagnosis is clear: – “Kan Bing Nan, Kan Bing Gui”
– Healthcare is available but not affordable and not accessible
• The problems have been detected: – Insufficient Government funding for public health/essential
care;
– Distorted provider payment system relying on fee-for-service;
–Wide-spread exposure to health-related financial risk;
–Weak quality/safety management and cost control systems;
– Unclear and insufficient role of government
![Page 4: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/4.jpg)
Rapid increase in health care expenditure ( 1978-2009)
Source: Health Statistic Yearbook
0
1
2
3
4
5
6
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
%
0
200
400
600
800
1000
1200
1400
Yuan
THE per capi ta THE as % of GDP
![Page 5: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/5.jpg)
Decreased share of govt. exp. and increased share of out-of-pocket( 1990-2009)
0
10
20
30
40
50
60
70
1980 1990 1995 2000 2002 2003 2004 2005 2006 2007 2008 2009
% o
f to
tal h
ealt
h e
xpen
dit
ure Govt. Exp.
Soc. Exp.
Out-of-Pocket
Source: Health Statistic Yearbook, 2010
![Page 6: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/6.jpg)
6
The Issue of Pharmaceutical Expenditure in China
• Drug revenue is the main source of reimbursement for hospitals
• High proportion of pharmaceutical expenditure in total health expenditure
• High economic burden for the patient is caused by drugs
• Irrational price setting on drugs
![Page 7: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/7.jpg)
Pharmaceutical expenditure in China, 1997-2006Year Pharmaceutical expenditure(billion ) % GDP %total health expenditure
1997159.90
2.02 46.88
1998178.34
2.11 46.87
1999198.87
2.22 45.91
2000221.11
2.23 45.40
2001 230.30 2.10 43.83
2002267.67
2.23 46.01
2003290.39
2.14 44.80
2004362.13
2.27 45.55
2005414.21
2.25 45.00
2006448.61
2.13 43.51
2007490.32
1.85 40.74
2008620.24
1.98 41.56
2009745.77
2.19 40.35
Source: China National Health Accounts Report 2010
![Page 8: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/8.jpg)
OECD as well as China TPE as % of GDP
![Page 9: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/9.jpg)
How did we get started?
New Health Care Reform Planned Announced in April 2009
![Page 10: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/10.jpg)
10
Five Core Tasks(2009-2011)
• The Healthcare Financing
-Universal Basic medical insurance system
-Equal public Health system
• Health care Delivery -Sound public community facilities
-Essential medicine policy system
-Public hospital reform
![Page 11: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/11.jpg)
National Essential Medicine System
• Improve drug supply
• Central Government sets "guiding retail prices "of essential medicines
• “Based on the result of tender, provincial governments set the unified purchasing prices within the range of the government purchasing price”
• “government run health care institutions at grass-roots levels shall sell drugs with zero mark up”
• Essential medicines will be insured, “with the reimbursing rate much higher than that of non-essential medicines”
![Page 12: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/12.jpg)
The timeline of promoting National essential medicines
• 2009, each province (autonomous regions and municipalities) in 30% of the government-run urban community health center and county implementation of the system
• 2010, 60%
• 2011 initial establishment of a national essential medicines system
• Full implementation the national essential medicines system
12
![Page 13: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/13.jpg)
what is the process we are using?
![Page 14: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/14.jpg)
National essential medicines list
• 2009 version of EML for Community based health center (Aug, 2009)– 205 kinds chemical drugs and biological products– 102 varieties Chinese medicines
• coupled with policy of “0 mark-up” for sales and public subsidy for losses, aiming to control overprescribing in community and rural public facilities
14
![Page 15: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/15.jpg)
Pricing
• National Development and Reform Commission(NDRC) Set the retail price for the national essential medicines 296, 2349 formulation
• Involving more than 3,000 pharmaceutical enterprises
• 49% of drug prices are not adjusted, 45% of drug price cuts, the average decline of 12%, 6% of drugs to raise prices
15
![Page 16: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/16.jpg)
Bidding and purchasing of essential drugs
• the government-led centralized drug purchasing
• Online procurement, price transparency
• direct delivery
• Drug prices are not higher than 15% of ex-factory price
16
![Page 17: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/17.jpg)
Medicine Supply and Procurement
• Single tender, volume-price negotiation and
unified distribution is to be used for procurement, with an emphasis on reducing intermediaries in the distribution chain
![Page 18: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/18.jpg)
Rational use of medicine
• The government's primary health care and health institutions all the equipment and the use of national essential medicines
• Other types of medical institutions have to choice to use a certain percentage of essential medicines
• Establish an effective management system of essential medicines
18
![Page 19: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/19.jpg)
Current situation
• Implemented in 60% of community health center in the provinces.
• The price of medicines are reduced 20-30%• Patients would like to visit secondary hospitals for
available medicines• Cost of Community health centers cannot be fully
reimbursement by the government after implementing the zero mark-up policy
• Pharmaceutical manufactories would not like to produce the EM due to the low price
![Page 20: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/20.jpg)
EM Policy implemented in 2778 counties
June, 2010 Sept. 2010 Dec. 2010
Percentage of EMP with Zero-mark up in Gov. Running Community health centers (%)
38.4 65.7 69.3
Percentage of EMP with Zero-mark up in township hospital (%)
57.2
Percentage of Counties which EM reimbursement by the NCMS (%)
82.9 86.3 94.7
Percentage of Counties which EM reimbursement by the UBEMI and UBRMI (%)
75.8 82.3 94.7
![Page 21: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/21.jpg)
What are the key future policy issues?
![Page 22: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/22.jpg)
22
Key issues• 307 medicines in EML cannot meet the needs of urban
residents. (children, chronic disease, antibiotics) • Main challenges in financing schemes (Compensation
mechanism needs to be further improved)• Mechanism to incentive doctor rational prescribe of
medicines • Price regulation for EM need to be improved.• How to balance the quality and price of the EM (The
lower price is the better?)• How to implement the EMP in non- government running
health facilities and village clinics.
![Page 23: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/23.jpg)
The Variation of Drug Items in Essential Medicine List
Areas No. of EM supplemented by the Province
Total No. in EML
National EML 307
NIngxia 53 360
fujian 148 455
zhejiang 150 457
Anhui 276 583
shandong 216 523
Tianjing 230 537
Beijing 241 548
Guangdong 244 551
Jiangsu 292 599
Shanghai 381 688
![Page 24: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/24.jpg)
Prioritize the national essential drug system 2011
• consolidate and expand the scope of the essential medicine system and implement the system in county and regional medical institutions
• consider adjusting the national essential drug list;• improve essential drug procurement, distribution,
management, and use;• improve drug payment policies;• encourage high-level hospitals to guide grassroots
medical institutions on the use of medicines
![Page 25: Essential medicines and health reform in China](https://reader036.vdocument.in/reader036/viewer/2022070410/568145e9550346895db2e9ed/html5/thumbnails/25.jpg)
Welcome to Shanghai