China's 'Yin and Yang Pricing' Scandal: Medical Insurance Buyers Pay More for Same Medications

The issue came to light thanks to the experience of a woman from Chongqing, who was informed by a pharmacist that using her medical insurance would result in a higher price than paying cash. As the incident makes headlines, experts and lawmakers are weighing in on the potential causes and consequences of this "dual pricing" system, which appears to be widespread among some pharmacies. At the heart of the matter lies the question: why are some pharmacies charging more for medications when purchased with medical insurance, and what does this mean for the future of China's healthcare system?

An investigation has uncovered a phenomenon known as "yin and yang pricing" in some pharmacies, where the same medication is sold at a higher price when paid for using medical insurance compared to cash. This not only violates China's pricing laws but also constitutes suspected price fraud and deception, disrupting the order of the pharmaceutical market and infringing on the rights of insured individuals. Experts point out that while there may be objective factors contributing to higher prices for medications paid for through medical insurance, such as the time it takes for pharmacies to receive reimbursement and potential handling fees, these factors cannot justify the significant price differences observed.

The practice of "yin and yang pricing" is seen as a clear violation of pricing regulations, potentially constituting price fraud, and could erode trust in the medical insurance system and deter people from participating. The incident has sparked concerns about the management of medical insurance funds and the need for regulatory oversight to prevent such practices. As medical insurance is a vital part of China's healthcare system, intended to provide financial protection to individuals against medical expenses, any abuse of the system could have far-reaching consequences, including diminished public trust and unequal access to healthcare services.

When insured individuals use their medical insurance personal accounts to purchase medicines, the funds do not directly flow from the patient's personal account to the pharmacy. Instead, the funds first enter the medical insurance administration system and are then settled between the medical insurance department and the pharmacy. If there are parts that need to be reimbursed through the overall planning, the pharmacy must first pay out of pocket. The settlement cycle, which varies by region, is usually a month or a quarter. During the settlement application process, pharmacies need to provide related data and sales records for auditing and also pay a handling fee of about 2% to 3%.

In such cases, some pharmacies may pass on the costs of funds and time to the prices of medicines, thereby transferring these costs to the insured individuals. Moreover, since many insured individuals have a relatively low sensitivity to drug prices, this gives some designated retail pharmacies the opportunity to operate irregularly. Experts emphasize that since pharmacies have enjoyed the advantages of signing contracts with medical insurance, they should bear the costs brought about by the medical insurance settlement cycle. Implementing "two different prices" for the same drug violates the pricing law's provisions on "clear pricing" and constitutes price fraud, disrupting the order of the pharmaceutical market and infringing on the rights of the insured.

The behavior of some pharmacies also suspects insurance fraud or causes the medical insurance fund to be wasted. Experts further point out that pharmacies' arbitrary price increases can reduce people's enthusiasm for paying medical insurance premiums to some extent and may lead to insured individuals misunderstanding medical insurance policies. To maintain the rights of insured individuals and prevent the waste of medical insurance funds, relevant departments should pay attention to this phenomenon in a timely manner and supervise designated retail pharmacies to unify prices and clearly mark prices, maximally curbing various insurance fraud and profiteering behaviors.

To address this issue, regulatory bodies should play a crucial role in monitoring pharmacies and enforcing strict adherence to pricing regulations. This includes ensuring that pharmacies do not overcharge for medications covered by insurance and maintaining transparency in pricing. Additionally, insured individuals themselves have a responsibility to be aware of the prices of medications and to report any discrepancies they notice. By doing so, they can help prevent the misuse of the medical insurance fund and protect their own financial interests.

In conclusion, to tackle the issue of price discrepancies for medications covered by insurance, regulatory bodies must enhance their supervision of pharmacies, enforce strict compliance with pricing regulations, and protect the rights of insured individuals. Simultaneously, insured individuals should become more price-sensitive, promptly reporting any suspected irregularities. This dual approach will help prevent the misuse of medical insurance funds and ensure the sustainability and fairness of the healthcare system. Regulatory bodies must take immediate action to prevent the exploitation of the medical insurance system, and insured individuals must be vigilant in monitoring prices and reporting any suspicious activities. By working together, China can ensure that its healthcare system remains fair, transparent, and effective in providing quality care to all its citizens.