How well does the leading pharmaceutical reform model work in china? --an interrupted time series analysis

Abstract

This present study aimed to explore the impact of the pharmaceutical reform of Sanming city, one of the most leading healthcare reform models in China on both drug and total health expenditures. Interrupted time series analysis with two intervention points was used to examine the impact of the pharmaceutical reform in Sanming City, China. The first intervention point was the implementation of Zero Mark-up Drug Policy, whereas the second one was the launch of Centralized Procurement of Medicine Policy. Primary outcomes are monthly inpatient drug expenditure and monthly inpatient total health expenditure. Data spanning from May 2012 to May 2014 are included. Both inpatient drug and total health expenditures exhibited rising trends before any policy was carried out. The launch of Zero Mark-up Drug Policy led to significant instant reductions in levels of inpatient drug expenditure (coefficient= -7,520.90, p<0.01) and total health expenditure (coefficient= -16,737, p<0.01). Moreover, the previous upward trends were changed into downward trends for inpatient drug expenditure (coefficient= -2,747.02, p=0.00) and total health expenditure (coefficient= -3,069.29, p=0.12). However, after the implementation of Centralized Procurement of Medicine Policy, we observed no significant instant level changes and also, the inpatient drug expenditure (coefficient=372.95, p=0.01) and total health expenditure (coefficient=788.76, p=0.06) resumed upward trends again meaning they returned to growing again. Although the pharmaceutical reform could control or reduced drug expenditure and total health expenditure in short term, the effect became weakened or even faded out in long term, indicating expenditures gradually resumed growing again and reached or even exceeded their baseline levels of pre-reform period. In all, the pharmaceutical reform as a whole failed to meet its goal of combating sharp growth of drug and total health expenditure.