Impact of zero-mark-up medicines policy on hospital revenue structure: a panel data analysis of 136 public tertiary hospitals in China, 2012-2020

ObjectiveTo quantify the overall and dynamic effects of the implementation of the zero-mark-up medicines policy on the proportionate revenue generated from medicines, medical services and government subsidies at Chinese tertiary public hospitals.MethodsThe revenue data of 136 tertiary public hospitals from 2012 to 2020 and the implementation-time framework of zero-mark-up medicines policy of these hospitals were obtained from the institutional survey of the third-party evaluation of the China Healthcare Improvement Initiative. The study adopted the time-varying difference-in-differences method and combined it with the event study approach to estimate the effects of the zero-mark-up medicines policy.ResultsFollowing the implementation of the policy, the proportionate medicines revenue decreased by 3.23% (pConclusionsAlthough the policy goal of adjusting hospital revenue structure has been achieved, the findings were insufficient to conclude whether the policy goal of establishing a scientific compensation mechanism was met by increasing the price of medical services and government input. Additionally, whether there was an unexpected policy effect requires further analysis.