China intensifies crackdown on medical insurance fraud

China is intensifying its crackdown on organized criminal networks involved in medical insurance fraud, as they pose a serious threat to the integrity of the medical system. 

Experts said that it shows a strong commitment to strengthening fund oversight and control. However, policies should be further enforced and implemented across various stages of medical regulation.

In a recent major crackdown, authorities seized nearly 30 tons of medication illegally obtained by a fraudulent gang. 

The gang paid to borrow other people's medical insurance cards or persuaded the insured to use their medical insurance card to dispense drugs in different community health centers, the China Central Television (CCTV) reported on Saturday.

In another recent crackdown, authorities confiscated 105 medical insurance cards and over 10,000 boxes of various drugs, according to CCTV.

Relevant criminals exploited the medical insurance system to purchase excessive amounts of medication, which they then sold to other merchants with higher price for profit.

Medical insurance fraud is increasingly being committed by a diverse range of perpetrators, according to the latest data for 2021-23, as reported by CCTV.

Perpetrators include insured persons and their close relatives, professional insurance fraud gangs, designated medical institutions, designated retail pharmacies, and in some cases also involve drug manufacturing enterprises. Among them, insured people were involved in nearly 55 percent of the cases, accounting for more than 50 percent of the total.

It is necessary to upgrade the national medicine supply security code, which can track the medical distribution process to ensure transparency and accountability, an industry insider close to the matter told the Global Times on Sunday on the condition of anonymity.

"Meanwhile, we should allow departments involved in drug management, such as commerce, tax, and medicine, to participate in a bid to achieve seamless supervision of the whole drug supply chain to avoid fraud," said the insider.

In 2023, China's medical insurance authorities inspected 802,000 designated medical institutions and identified violations in 451,000 of them, according to a statement released by China's National Healthcare Security Administration in July.