China Implements Traceability Codes in Hospitals and Pharmacies to Combat Insurance Fraud

The National Healthcare Security Administration announced that almost 95% of hospitals and pharmacies designated for insurance in China have adopted traceability codes for their medical products. This measure aims to combat insurance fraud, ensuring that each packaged unit of medication or medical consumable is assigned a unique serial number printed on its packaging upon completion of production.

The introduction of these traceability codes primarily focuses on safeguarding public insurance funds by making it easier to identify fraudulent activities, which include the resale of covered medications, the creation of fake prescriptions, and the improper use of insurance cards. Since the promotion of collecting and utilizing these codes started in April, the administration has gathered over 15.8 billion codes from approximately 880,000 insurance-designated institutions, which constitutes about 94.7% of such facilities.

Fu Chaoqi, who oversees the administration's big data center, explained that a typical box of medicine passes through three to five distribution channels before reaching consumers, with each channel generating valuable traceability information. In China, there are around 4,300 manufacturers producing insured medications, 11,000 distributors, and 930,000 insurance-designated institutions, encompassing a wide range of about 247,000 types of medicines available under public insurance.

Fu further stated that the volume of traceability information generated annually is estimated to be between 180 billion and 300 billion pieces. Efforts are currently underway to develop a centralized online platform that will aggregate all traceability data for improved monitoring and accountability.