Thursday, 2 January 2014

Anhui city offers 'no commission' medicines to locals

The city of Wuhu in Anhui says its two year experiment in offering cost-price medications through hospitals has been a great success in making medical treatment affordable and eliminating kickbacks that plagued the former commission system. The city says its residents have saved over 200 million renminbi under the new system that stops hospitals from charging markups on medicines. The scheme was started two years ago on a limited range of medications and is now to be extended to high costs areas such as cardiac and arthritis medicines and sedatives.
According to the Wuhu News, the 'zero commission' scheme has eliminated the 'grey market' that existed between pharmaceutical wholesalers and hospitals. Under the new system, suppliers must tender for contracts that are open and guarantee to supply medicines at a fixed price for a one year period. Savings are passed on to the public. The authorities say their scheme has switched from one in which hospitals earn money from drugs to one in which they relieve the burden of the public. One of the other benefits of the scheme is that is has uncoupled prescribing from financial incentives, and thus promoted more rational treatment, the local health department says.

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