Hospitals to stop taking cut of drug sales

A pilot program to reform hospital funding will be expanded in the near future to all public hospitals across the city, health-care officials said at a press conference Tuesday.

The pilot program, which is underway at four selected hospitals, is part of the city government's ongoing 3-year action plan (2013-2015) for public hospital reform. Under the program, the four hospitals do not charge a markup on the prescription drugs their doctors prescribe. The measure reduces the price of the drugs by about 15 percent for patients.

The hospitals can recover some of the lost revenue through higher consultation, nursing and bed fees, according to a previous report on the Shanghai Municipal Government's website.

Apart from the higher fees, the city's government has also boosted subsidies for public hospitals as part of its reforms. "The government has increased financial assistance for the city's health-care system to ensure that public hospitals are capable of providing universal and affordable health-care to local residents," said Xu Su, deputy director of the health-care reform office of the Shanghai Municipal Health and Family Planning Commission.

The government raised the amount of assistance by 27 percent year-on-year in 2012. So far, it has put more than 15 billion yuan ($2.44 billion) into the city's medical health reforms, Xu said.

Whether the reform succeeds largely hinges on keeping doctors and medical staff in the public hospital system, said Qu Jieming, deputy director of the Shanghai Municipal Health and Family Planning Commission.

Doctors and medical staff who have better skills, work longer hours and provide better service to patients will receive better pay based on an improved evaluation system with more scientific criteria.

However, a doctor at a Grade 3, first-class hospital said that he didn't think the government's plan to increase doctors' salaries provided enough of an incentive for them to improve service.