Hunan will implement a new settlement method for centralized procurement consumables, with artificial crystals as the first batch of products.

Starting from February 1st, the settlement method will be changed
Recently, the Hunan Provincial Medical Security Bureau issued a notice on the direct settlement of medical insurance fund payments for selected medical consumables in centralized quantity procurement (hereinafter referred to as the "Notice"), requiring direct settlement of medical insurance fund payments for selected consumables products in centralized procurement to be carried out from February 1, 2025. The document on which the "Notice" is based is the "Notice on Implementing Direct Settlement of Medical Insurance Funds for Centralized Procurement of Selected Products' Medical Payment" (Xiang Medical Insurance Fa [2023] No. 36).

The Notice specifies that from February 1st, direct settlement of medical insurance funds for selected consumables products through centralized procurement will be carried out. The first batch of consumables selected for direct settlement and centralized procurement are "artificial crystals". Subsequently, relevant medical consumables products will be included in direct settlement according to the requirements of the implementation documents for each batch of centralized procurement.

According to the "Hunan Medical Insurance Bureau [2023] No. 36" document previously released, the implementation scope of this notice is that the payment for selected products of national, inter provincial alliances, and provincial centralized procurement of drugs and medical consumables purchased by designated public medical institutions at all levels of medical insurance in the province through the national unified medical insurance information platform "Drug and Medical Consumables Procurement Management System" should be included in the direct settlement scope of the medical insurance fund. Medical institutions are still responsible for settling pharmaceutical payments with pharmaceutical companies in accordance with regulations for those that do not belong to centralized quantity based procurement (except for regions that have fully implemented pilot programs for direct settlement of pharmaceutical payments through medical insurance funds).

The settlement principle is as follows:
1. Territorial management and graded settlement. Medical payments are subject to local management and graded settlement. Pharmaceutical and medical consumables manufacturing or distribution enterprises (hereinafter referred to as "pharmaceutical enterprises") shall provide bank settlement accounts to the medical insurance agency in the location where the medical institution conducting business is located, for the purpose of receiving medical settlement payments. Provincial medical insurance agencies are responsible for the direct settlement of medical payment and medical insurance funds for provincial medical institutions in the urban area of Changsha, while medical insurance agencies in various cities, prefectures, counties, and districts are responsible for the direct settlement of medical payment and medical insurance funds for local medical institutions.

2. Unified process and transparent settlement. The centralized procurement of medical expenses by various medical institutions through the medical insurance procurement system shall be settled directly with pharmaceutical enterprises on a monthly basis by the medical insurance agency through the "Medical Payment Settlement Management" of the medical insurance procurement system, and disbursed from the basic medical insurance fund expenditure account.

3. Protocol management, clarify responsibilities. Medical insurance agencies at all levels should sign a written "Medical Payment Entrustment Settlement Agreement" with medical institutions and upload it to the medical insurance procurement system.

Shi Zihai, a member of the Party Group and Deputy Director of the National Medical Insurance Administration, once mentioned that timely payment for selected drugs and consumables in centralized procurement plays a positive role in improving the pharmaceutical procurement environment, stabilizing the expectations of production and distribution enterprises, and ensuring the supply of centralized procurement drugs and consumables. In other words, through direct settlement of medical insurance funds, enterprises and hospitals are expected to achieve a win-win situation.

By 2026, all coordinated regions will be implemented
It is understood that the difficulty and pain point for pharmaceutical companies to settle payments after the delivery of drugs and medical consumables is the difficulty and pain point of seeking payment. Direct settlement of medical insurance funds is one of the effective measures to solve this difficulty. In fact, several regions across the country have already started piloting the direct settlement of medical insurance funds for centralized procurement of drugs and consumables. On July 19, 2024, the National Healthcare Security Administration also praised the measures taken by healthcare insurance departments in Inner Mongolia, Jiangxi, Guangxi and other places to directly settle medical insurance funds with pharmaceutical enterprises in the article "Empowering the High Quality Development of the Pharmaceutical Industry through Direct Settlement of Medical Insurance Funds".

In October 2024, the Hainan Medical Insurance Bureau began implementing the "Implementation Plan for Direct Settlement of Medical Payment between Hainan Provincial Medical Insurance Fund and Pharmaceutical Enterprises". The plan mentioned that starting from centralized procurement of drugs, medical consumables, and innovative medical equipment, direct settlement work would be carried out in designated medical institutions throughout the province; At the same time, Wenchang City was selected as a pilot, and drugs and medical consumables purchased by designated public medical institutions within its jurisdiction without centralized procurement were included in the direct settlement scope. The experience was summarized and timely promoted throughout the province.

On January 1, 2025, Anhui Province began implementing a new model of medical insurance fund settlement reform. After implementing real-time settlement, the time limit for disbursing medical insurance funds has been reduced from the usual 60 days to 1 day. On January 15th, the "instant settlement" function module of the medical insurance fund in Zhengzhou, Henan Province was launched and put into operation. All 30 designated medical institutions participating in the "three settlements" reform pilot have achieved "same day declaration and same day disbursement" of settlement business. In addition, more than 2000 designated medical institutions in Xiamen, Fujian have all connected to the real-time settlement system, fully realizing the "full coverage" of real-time settlement for medical institutions and medical insurance funds.

The National Medical Insurance Administration has mentioned that since the implementation of the provincial unified payment and instant settlement reform of the medical insurance fund, Hainan Province has uniformly paid 21.149 billion yuan in basic medical insurance premiums. In addition, it is estimated that in Inner Mongolia, Jiangxi, and Guangxi alone, an average of nearly 250 million yuan in financing costs can be saved for distribution companies each year.

Overall, the direct settlement between medical insurance funds and pharmaceutical companies has reduced operating costs and greatly improved the efficiency of fund utilization. This also proves that direct settlement of medical insurance funds has a positive impact on the long-term development of enterprises, and can further empower the high-quality development of the medical and health industry and the pharmaceutical industry.

Conclusion
On January 16th, the National Healthcare Security Administration issued a notice on promoting the reform of instant settlement of basic medical insurance funds, requiring the use of a unified national medical insurance information platform as a support, while fully considering the needs and capabilities of designated medical institutions, to achieve instant settlement in about 80% of the national pooling areas by 2025 and in all pooling areas by 2026. In 2025, direct and real-time settlement of centralized procurement consumables will be further expanded, and the capital turnover efficiency of pharmaceutical institutions will also accelerate again.

Source:
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