Four chain pharmacies, including Laobaixing, are summoned: substituting cosmetics for medicines, illegal use of medical insurance funds, and transferring evidence to resist inspections

Recently, the National Healthcare Security Administration launched a special fly-in inspection targeting designated retail pharmacies in Huaihua, Shaoyang, Hengyang, Zhuzhou in Hunan Province, as well as Zhengzhou in Henan Province, focusing on illegal use of medical insurance funds by replacing cosmetics and other products with medicines or medical services. They also held interviews with relevant persons in charge of chain pharmacies such as Laobaixing, Yangtianhe, Yifeng, and Henan Zhang Zhongjing Co., Ltd.

The interview pointed out that, amid the deepening of special rectification of prominent issues in the management of medical insurance funds at all levels, and under the high-pressure situation of two consecutive years of special campaigns cracking down on illegal and irregular activities in the field of medical insurance drugs, at the time when the “Implementation Rules for the Supervision and Administration of the Use of Medical Security Funds” officially came into effect, and in the context of multiple investigations, exposures, repeated talks, warnings, and educational alerts by the medical insurance departments, the inspected institutions still have issues such as replacing cosmetics and other products with medicines and medical services, violating real-name registration regulations to inflate accounts, overprescribing medicines, and illegal use of medical insurance funds. Some stores also countered inspections by transferring evidence, deleting videos, hiding accounts, etc. The nature of these violations is serious and the impact is bad. The National Healthcare Security Administration publicly condemns these illegal behaviors.

The interview emphasized that medical insurance funds are the “medical money” and “life-saving money” of the people. For the designated retail pharmacies found to be replacing other products with medical insurance medicines (consumables, medical services), the medical insurance departments will handle them strictly according to law and regulations, and will resolutely terminate service agreements in accordance with the “Interim Measures for the Management of Retail Pharmacies’ Designated Medical Insurance” (Order No. 3 of the National Healthcare Security Administration). Relevant responsible persons will be scored for medical insurance payment qualification management; violations involving other regulatory responsibilities will be transferred to the relevant authorities.

Many designated retail pharmacies under involved chain organizations have repeatedly appeared with violations in multiple locations, using professional and covert methods to deliberately evade supervision. This reflects the virtualization of the main responsibilities of the involved chain pharmacies, weak compliance awareness, failure of internal control management, and lax enforcement of systems. The lessons are profound, and the issues warrant vigilance. The interview requires that all involved chain organizations must raise their awareness, deeply analyze the root causes, take the most resolute attitude to rectify, implement the strictest measures to improve long-term management mechanisms, and strengthen the foundation of compliant operation.

First, they must seriously hold accountable the stores and responsible persons found to have violations, forming a strong internal deterrent.

Second, they should quickly organize all designated stores under their umbrella to conduct comprehensive self-inspections and rectifications, promptly return the misused medical insurance funds, and if fraud is involved, voluntarily report to the medical insurance department.

Third, they should learn from cases and promote reform through case-based internal warning education, guiding all staff to recognize the hazards of violations, respect laws and regulations, cherish brand reputation, and resolutely eliminate complacency, negligence, and repeated violations.

Fourth, they must focus on the “Regulations on the Supervision and Administration of the Use of Medical Security Funds,” its implementation rules, and the service agreements for designated retail pharmacies, organizing specialized training on medical insurance laws and regulations for all staff.

Fifth, they must earnestly assume the main responsibility for compliant use of medical insurance funds, improve internal management systems for medical insurance compliance, establish regular supervision mechanisms for headquarters over regional stores, especially franchise stores, and enforce daily compliance management and assessment of staff. For personnel involved in fraud or violations, the “one-vote veto” system must be strictly implemented.

The National Healthcare Security Administration explicitly requires that the healthcare insurance bureaus of Hunan and Henan provinces guide and supervise the local departments to monitor the follow-up rectification of the interviewed units and report progress in a timely manner. The Administration will adopt various methods to continuously review the rectification status of the interviewed units, resolutely prevent and resolve risks with a high sense of responsibility for the people, and firmly crack down on illegal and irregular activities to safeguard the security of the medical insurance fund.

The National Healthcare Security Administration also sincerely reminds everyone that the drug traceability code is the only ID for each smallest packaging unit of medicine. Whether online or offline medical treatment and purchasing, whether self-paid or reimbursed by medical insurance, pharmaceutical institutions are required by law to scan and upload codes and provide consumers with sales receipts containing all purchased drug traceability codes. Any behavior that does not scan codes is suspected of replacing or reselling drugs. All discrepancies in codes can be reported to the regulatory authorities. For your and your family’s medication safety, please do not take counterfeit or replaced drugs, and supervise medical institutions to scan codes. Also, refuse to accept sales receipts without traceability codes or with codes that do not match the actual drugs.

This article is sourced from the official website of the National Healthcare Security Administration.

Risk warning and disclaimer

Market risks are present; investments should be cautious. This article does not constitute personal investment advice and does not consider individual users’ specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investment is at your own risk.