The emergence of health insurance cost control began after 2010. Since 2011, some regions, such as Shanghai, have shifted from increasing income to reducing expenditure. In 2013, the growth rate of the revenue of the medical insurance fund was lower than that of the expenditure, and the balance of the fund was narrowed or even exceeded. By 2015, the growth rate of revenue and expenditure of medicare fund had decreased to 15.55% and 14.48% respectively. At the same time, bidding price reduction, health care control fees into the industry normal.
"The cost control of healthcare will lead to slower revenue growth in the pharmaceutical industry." Zhao explained that since 2009, the main success of the reform has been to increase government spending, drive the growth of the pharmaceutical industry and establish universal coverage and affordable medical care.
The new contradiction is that after the decline in GDP growth, the pharmaceutical industry continues to increase investment pressure. Zhao bing believes that, "in the situation that the growth rate of medical insurance expenditure is higher than the growth rate of financing, in order to maintain the balance of medical insurance fund, fee control will become the core of medical insurance reform in the long run. At present, the reform of the pharmaceutical industry and health insurance is essentially to control the growth of medical costs through the adjustment of the demand side structure.
"From 2011 to 2015, the pharmaceutical industry saw 15 percent compound annual growth in revenue. But we expect revenue growth to slow to 10 per cent over the next three years."