# Impact of combined medication payment management policies on population health performance

## TL;DR

This study examines how combining centralized drug procurement and national price negotiations affects population health and healthcare spending efficiency.

## Contribution

The study introduces a two-dimensional analytical framework to evaluate the impact of combined pharmaceutical policies on health outcomes and expenditures.

## Key findings

- The policy combination significantly improved population health outcomes.
- It enhanced the efficiency of healthcare spending and stimulated pharmaceutical innovation.
- Import substitution and export upgrading showed synergistic effects.

## Abstract

This study investigated the mechanism and impact of a policy combination involving centralized drug procurement and national drug price negotiations on health insurance payment management and overall health performance of the population. Relying on a two-dimensional analytical framework of health outcomes and medical expenditures, the entropy value method was applied to construct indicators of residents’ health portfolios. The year 2019, marked by the large-scale implementation of centralized procurement and national medicine catalog negotiations, was identified as the policy breakpoint for constructing a breakpoint regression model. Based on CFPS data, the model was implemented to evaluate changes in residents’ health outcomes and medical expenditure efficiency. Furthermore, the mechanisms underlying policy effects were examined from the perspectives of drug expenditure, pharmaceutical innovation (e.g., R&D inputs and patent output), and drug trade including imports and exports. The results indicated that this policy combination significantly improved population health outcomes and enhanced the efficiency of healthcare spending. Mechanism analysis further confirmed its short-term effects on stimulating innovation, increasing drug accessibility, and promoting expenditure efficiency. In addition, empirical evidence supported the hypothesized synergy between import substitution and export upgrading. Therefore, it is recommended to establish a value-oriented drug classification and payment management mechanism while adapting regional policies to provide a scientific basis for optimizing pharmaceutical policy design and balancing health accessibility with the advancement of innovation in the pharmaceutical industry.