Disadvantages and fog: Zhang Ming talks about volume procurement

On April 9, Zhang Ming, the head of the expert group of the Medical Price and Recruitment Guidance Center of the National Medical Insurance Administration, attended the 3rd World Health Expo Medical Reform Summit Forum and delivered a speech.

Concentrated recruitment for 20 years, there have been many disadvantages in the past

The centralized recruitment and procurement of medicines has a history of nearly 20 years in my country.

Where did the falsely high drug prices go? Although Zhang Ming has not started this "mist", it seems to be an open secret.

During the period, the author visited many people inside and outside the industry.

The interviewees all said that the conclusion that there were drawbacks in the past drug tenders was highly consistent, and many open secrets of the past drug tenders were revealed.

Public "fog"

Zhang Ming pointed out that there are many false heights between the time the medicine leaves the factory and enters the hospital.

The second is that in the past 20 years of bidding and procurement, whether it is imported or domestic drugs, it has been advertised that "high prices are due to good quality".

The third is that the results of price reductions for volume purchases show that the "two-invoice system" implemented in 2017 did not solve the problem of falsely high drug prices and gold sales, and the results of policy implementation have gone to the opposite side of the original policy.

The fourth is the pilot project in 2009 and the implementation of "zero markup" across the country in 2015.

However, the author has received different feedback from the industry insiders about the past shortcomings that have caused the problem of falsely high drug prices and gold sales.

Did the past falsely high drug prices stem from "volume-price decoupling" and "insufficient competition"?

Team Leader Zhang Ming believes that in the past bidding and procurement, only prices were recruited without quantity; the previous procurement levels were relatively low and the power was scattered, which weakened the market competition mechanism.

Some people in the industry believe that starting from the nature of the problem of inflated drug prices that have lasted for nearly 20 years, the "centralized bidding and procurement of drugs" led by relevant departments has been making a fuss on the issue of "quantity" and continuously increasing the level of procurement (from the past).

In order to confirm the above point of view, the author investigated the relevant situation.

(1) The performance of hospital procurement prices after the mandatory 15% price increase in 2006

During the period 2000-2005 when the centralized drug procurement policy was first implemented, there was also a 50%-60% drop in drug prices.

In 2006, according to relevant research in Shanxi Province, it was found that the hospital prices (winning bid price *1.

In 2006, the Shanxi Provincial People's Hospital led 100 hospitals to jointly bid for the procurement of 7,389 drug specifications.
The survey showed that hospitals with all product specifications had higher prices than pharmacies, and some were many times higher.

(2) Hospital procurement price performance after the cancellation of drug markup (zero markup) in 2009

We moved the time forward to 2009, and the relevant departments canceled the 15% drug addition on the grounds of breaking the division and replenishing the medicine, and implemented a zero markup rate.
In 2010, Anhui implemented centralized bidding and procurement of essential drugs, and the winning bid price dropped by an average of 48% compared to before the reform, but the actual procurement results are as follows:

Statistics on centralized procurement of essential medicines in Anhui Province in 2011 (January 1st-April 1st)

For example, the purchase price of Guipi Mixture with a bid price of 20.
01 yuan was 1.
58 million yuan, while the purchase price of Guipi Wan with a bid price of 2 yuan was only 3 million yuan in the same period.
The purchase amount of the high-priced bid was 527 times that of the low-priced one.

Relevant persons stated that the “quantity purchase” led by the Medical Insurance Bureau has solved the problem of “only recruiting but not recruiting” in the past.
Under the current shortage of medical insurance funds (there have been shortfalls in many places) and the strong demand for cost control, it has adopted Fulfilling the promise of purchasing volume, sharing 50%-70% of the market share through a single product or several companies, and through medical insurance advance payment, the medical insurance bureau suppressed the price of medicines that were 5 times, 10 times or even a hundred times higher than the original price.
50% is not a difficult thing.
However, the current average drop of more than 50% is not enough to exaggerate the performance (the average price of medicines has also fallen sharply before the Medical Insurance Bureau), and the "volume purchase" only squeezes out the original price of these varieties (rebates) However, under the current zero markup control, it is still unable to solve the problems of high-priced rebate drugs and product replacements other than the "volume purchase" products purchased by hospitals.
For example, Sanming implemented price-restricted procurement and key monitoring drug catalogs that year, and the sales of reduced-price drugs declined rapidly or even went directly to zero.
Doctors replaced drugs with similar curative effects and high price rebates.
For example, omeprazole injection was listed as an auxiliary After the drug list disappeared from the hospital's top 100 medications, it was replaced by lansoprazole and pantoprazole, which are also proton pump inhibitors (PPI).
Press the gourd and lift the scoop.

There is a heated discussion in the industry, what are the reasons for the falsely high drug prices and the proliferation of rebates?

According to industry insiders, since 2006, "centralized bidding", "centralized procurement", "categorized procurement", "quantity procurement", "GPO", "pharmaceutical exchange", "alliance procurement", etc.
have continued to change despite the continuous changes in their forms.
However, it has not changed the nature of the procurement department determining the procurement price of pharmaceutical equipment for public medical institutions, because centralized procurement locked the procurement price of medical equipment for hospitals, which undermined the normal market competition system, forcing pharmaceutical companies to have to carry out hidden transactions in the underground competition.
.
In fact, under the superimposed effect of recruitment pricing and zero markup, pharmaceutical companies can only work through the path of "high pricing and high rebates".
Pharmaceutical companies seek to win bids at high prices through key bidding departments, thereby forming a huge price gap.
The greater the space, the stronger the competitiveness; huge rebates have led to doctors’ prescriptions and drug abuse intensified, doctor-patient conflicts are frequent, and officials’ rent-seeking corruption is rife.
, The industry is completely corrupt.
The direct reason is that the hospital drug purchase price determined by the relevant departments through the so-called centralized procurement is seriously out of the market value.
It is either falsely high several times or even dozens of times, or falsely low enough that even the production cost is not enough.
The root cause is that the purchase price is determined by the tendering department.
, Instead of being determined by the market, doing what you shouldn’t do.

Some people say that the current "volume procurement" led by medical insurance is essentially the same as the previous "centralized bidding and procurement" led by the health administrative department, except that the medical insurance bureau is the one who pays the bill, and the incentive to cut prices is greater.

To make suggestions and suggestions, the government needs to be clear about what it should manage? What shouldn't you care about?

Some experts believe that improper intervention has caused many catastrophic problems and should not be managed.
So, what should the relevant departments manage and what should they not?

At present, relevant departments regard the so-called “speciality” in health economics as the reason for the government to intervene in the price of medicines.
However, the key to this “speciality” for medicines lies in the information asymmetry between doctors and patients, and patients are in Weak position, hospitals and doctors are in a strong position of professional information monopoly, and the government needs to intervene in the transaction price between doctors and patients, that is, medical insurance payment price or hospital sales price limit.
The whole world follows only the medical insurance payment price and retail price limit, and there is still no country that interferes with the hospital purchase price and the price difference between the purchase and sale, because in the hospital drug procurement link, it is the relationship between the hospital and the pharmaceutical company.
In this link Without the participation of patients, there would be no particularity without the participation of patients.
The government has no reason to intervene in hospital procurement prices and the rate of difference between purchases and sales by "speciality".
Therefore, the government can only intervene in the payment price of medicines and medical insurance (retail price limit), and cannot intervene in other related links, and should be liberalized.

In fact, if medical insurance wants to completely solve the problem of drug prices, it should not and cannot follow the old ways of bidding, administrative pricing, zero markup, and two-invoice system.
Improper administrative control disrupts normal market competition and leads to a full shift to the "underground".
Market competition, at the same time, the real drug price information has almost disappeared.
Therefore, if the medical insurance bureau wants to solve the problem of drug prices, it must follow the internal operating rules of the market.
The method is consistent with the method of encouraging price reduction of any commodity, that is, competition.
Competition is a better alternative than administrative control.
At the same time, hospitals are allowed to obtain "clear profits" in the purchase and sale of medicines, to give play to the positive incentive role of medical insurance payment, and to increase the motivation of hospitals' reserve price purchases and doctors' reasonable prescriptions.
In fact, the "prohibition of hospitals' profit-seeking (zero markup)" violates the normal law of value.
The prohibition of hospitals' explicit profit-seeking will inevitably lead to the formation of underground profit-seeking.
Without open "marketization", it will inevitably lead to the formation of an "underground market".
"Transformation", the two are in a trade-off relationship.

Currently, there is only one step away from the ultimate success! This last step is also the most critical step.
After discovering the true information of drug prices by means of mass purchase, cancel the zero markup rate, cancel administrative controls such as the government's determination of drug purchase prices for medical institutions, and formulate the "pharmaceutical insurance payment price" as soon as possible ( The hospital purchase price is not directly determined).
The actual purchase price is formed by the independent bidding game between the hospital and the pharmaceutical company (to avoid access and price monopoly caused by administrative intervention), allowing the hospital to obtain the benefits of saving purchase costs, and the hospital will naturally have an incentive to lower the purchase price , So as to promote the supply of pharmaceutical companies at the reserve price, let the drug prices gradually return to the market standard and help discover the true market prices, and then adjust the medical insurance payment prices scientifically and reasonably; at the same time, pharmaceutical companies will form a healthy competition that depends on quality, price and service.
Market competition can guide enterprises to operate in a standardized and orderly manner.
It is no longer possible and unnecessary to engage in underground competition with "high pricing and large rebates".