Real steps needed to reduce medical costs

The Beijing municipal government launched a landmark medical reform early this month by separating drug sales from medical treatment in public hospitals with the aim of lowering overall medical costs and improving services for patients.

The reform, implemented in more than 3,600 medical institutions across the city, replaces the traditional registration fee, which was deemed too low for doctors, with higher medical service charge, while reducing the fees for the use of equipment such as computed tomography and nuclear magnetic resonance but increasing the charges for certain medical services that require high level of experience, expertise and/or staff time, including acupuncture. The reform also eliminates the practice of drug price markup by hospitals, which was as high as 15 percent. The public response, however, has been one of concern.

After the reform, the cost of consulting a doctor has increased, but the overall charge paid by patients for medication has declined, according to media reports. The change in the behavior of doctors brought about by the reform is that they have become more cautious in prescribing medicines leading to lower medication costs.