The National Healthcare Security Administration is set to inspect pharmacies—here’s the key focus.

Just now, the National Healthcare Security Administration released the "Guidance Catalogue of Administrative Enforcement Matters in Medical Security" (hereinafter referred to as the "Catalogue"), listing 15 categories of administrative enforcement actions. These involve medical institutions, pharmaceutical businesses, insured entities, and insured individuals, with enforcement carried out by healthcare security administrative departments at all levels.

(Image source: National Healthcare Security Administration)

Among these, the administrative inspections or administrative penalties targeting retail pharmacies primarily cover the following areas, with penalties and inspections conducted in accordance with laws, administrative regulations, and normative documents.

Pharmacies engaging in insurance fraud will face fines ranging from two to five times the amount defrauded.

The "Catalogue" specifies the penalties for medical insurance service providers, such as pharmaceutical businesses, that fraudulently obtain or illegally claim expenditures from medical and maternity insurance funds by means of deception, forging supporting documents, or other improper methods. Penalties will be imposed according to the following criteria:

Article 87 of the Social Insurance Law stipulates that if social insurance agencies, as well as medical institutions, pharmaceutical companies, and other social insurance service providers, fraudulently obtain or illegally acquire social insurance fund disbursements by means of deception, forged documentation, or other deceptive practices, they shall be ordered by the social insurance administrative department to return the illegally obtained funds and will be subject to a fine ranging from twice to five times the amount defrauded.

Article 104 of the "Basic Medical and Health Law and Health Promotion Law": If basic medical insurance administrative agencies, as well as medical institutions, pharmaceutical enterprises, and other entities, fraudulently obtain or illegally acquire expenditures from the basic medical insurance fund by means of deception, forged supporting documents, or other deceptive practices, the medical security authorities under county-level or higher people's governments shall impose administrative penalties in accordance with relevant laws and administrative regulations governing social insurance.

Article 25 of the "Several Provisions on Implementing the Social Insurance Law of the People's Republic of China": If medical institutions, pharmaceutical retailers, and other social insurance service providers fraudulently obtain or illegally acquire social insurance fund disbursements by means of deception, forging supporting documents, or other deceptive practices, they shall be ordered by the social insurance administrative department to return the illegally obtained funds and fined an amount between two and five times the sum involved.

Retail pharmacy drug prices will be monitored.

Price monitoring and cost investigations of pharmaceuticals and medical consumables will be conducted through administrative inspections according to the following requirements:

Article 103 of the "Basic Medical and Health Law & Health Promotion Law": Any bidder participating in pharmaceutical procurement bidding who violates the provisions of this law by submitting a bid with a price lower than cost, or by engaging in fraudulent practices, bid-rigging, or abusing their dominant market position, shall be ordered by the medical security authorities under the county-level or higher people's governments to make corrections and have their illegal gains confiscated. If such a bidder has already won the bid, the bid shall be deemed invalid, and the bidder shall be subject to a fine ranging from 0.5% to 1% of the中标项目金额 (amount of the awarded project). Additionally, the legal representative, principal person in charge, directly responsible supervisor, and other individuals bearing responsibility shall each face a fine equivalent to 5% to 10% of the company’s penalty amount. In cases of serious violations, the bidder’s eligibility to participate in pharmaceutical procurement bidding will be revoked for a period of 2 to 5 years, and the decision will be publicly announced.

Article 86 of the "Drug Administration Law": Holders of drug marketing authorization, pharmaceutical manufacturers, pharmaceutical distributors, and medical institutions shall, in accordance with the law, provide the drug pricing authorities with information such as the actual purchase and sales prices and quantities of their drugs.

Regulations on Functional Allocation, Organizational Structure, and Staffing Levels for Medical Security Authorities at All Levels.

The prices and quantities of drug purchases and sales are subject to inspection.

According to the "Catalog," pharmaceutical distribution enterprises are required to provide the pharmaceutical price authorities with detailed information—including actual purchase and sales prices, as well as purchase and sales volumes—of their drugs and medical consumables for inspection and supervision. The specific criteria for these inspections are as follows:

Article 86 of the "Drug Administration Law": Holders of drug marketing authorization, pharmaceutical manufacturers, pharmaceutical distributors, and medical institutions shall, in accordance with the law, provide the drug pricing authorities with information such as the actual purchase and sales prices and quantities of their drugs.

Regulations on Functional Allocation, Organizational Structure, and Staffing Levels for Medical Security Authorities at All Levels.

Meanwhile, the "Catalogue" clearly outlines penalties for actions that involve fraudulently obtaining medical insurance fund payments by violating pharmaceutical pricing policies and other related regulations. The specific basis is as follows:

Article 87 of the Social Insurance Law: If social insurance administration agencies, as well as medical institutions, pharmaceutical retailers, and other social insurance service providers, fraudulently obtain or illegally acquire social insurance fund disbursements by means of deception, forged documentation, or other deceptive practices, they shall be ordered by the social insurance administrative department to return the illegally obtained funds and fined an amount between two and five times the sum involved. In cases involving social insurance service providers, their service agreements will be terminated. Additionally, if the directly responsible managers and other personnel directly accountable possess professional qualifications, their licenses will be revoked in accordance with the law.