In this Insights series, Around the World in HTAs, we shed light on HTA around the world. In this edition, Meng Li, Claud Theakston and Yawen Jiang take us to China.
Healthcare provision in China
China has made notable strides toward achieving universal health coverage for its population of 1.4 billion. Two major public insurance schemes provide coverage to over 95% of the population: the Urban Employee Basic Medical Insurance (UEBMI) for formal sector employees and retirees, and the Urban-Rural Resident Basic Medical Insurance (URRBMI) for rural populations and urban residents without formal employment. Both schemes focus on “basic needs,” which has historically limited coverage for advanced or high-cost treatments.
China’s healthcare delivery is structured as a tiered system. Tertiary hospitals in urban areas provide advanced care, while township and community health facilities offer basic services to rural and underserved populations. Most hospitals are publicly owned, with public institutions accounting for roughly 70% of hospital beds. Pharmaceutical distribution is also hospital-based, with the majority of prescriptions dispensed directly through hospital pharmacies. Historically, hospitals generated revenue from drug sales, but reforms, most notably the “zero-markup” drug policy, aim to reduce this dependency.
The National Reimbursable Drug List (NRDL) and use of Health Technology Assessment (HTA) in drug coverage before 2017
Prescription drug spending accounts for approximately 30-40% of total healthcare expenditures; the latter accounts for about 7% of GDP. At the centre of the country’s pharmaceutical reimbursement system is the National Reimbursable Drug List (NRDL), which determines which medicines are eligible for coverage under the two major public insurance schemes. Prior to 2017, the NRDL was updated infrequently and through a highly opaque process. Updates could be years apart, sometimes more than five, and drug selection was largely based on administrative judgment and expert opinion, rather than systematic evaluation.
Drug prices during this period were centrally set by the National Development and Reform Commission (NDRC), which issued price ceilings based on production costs, historical procurement, or external reference pricing. While this approach aimed to control spending, it often discouraged innovation and failed to reflect the value of new drugs. Hospitals, which were allowed to mark up drug prices, relied heavily on pharmaceutical sales for revenue. This created incentives for overprescribing and contributed to rising healthcare costs, particularly for high-priced branded drugs.
Early efforts to introduce health technology assessment (HTA) in China were limited in scope and influence. Academic and hospital-based researchers, supported by the Ministry of Health, conducted occasional assessments of new technologies, focusing mainly on safety and clinical effectiveness. A pharmacoeconomic evaluation guideline was issued in 2011, but it had little practical impact in the absence of institutional mandates or demand from policymakers. Economic value played almost no role in drug coverage decisions at the national level.
A transitional period began to take shape between 2015 and 2017. In 2015, the NDRC stepped back from routine drug price setting, signalling a shift toward more market-based pricing under government oversight. At the same time, policymakers started to pay closer attention to the budget impact and cost-effectiveness of high-cost drugs, though this analysis remained informal and fragmented.
In 2016 and 2017, the Ministry of Human Resources and Social Security and the National Health and Family Planning Commission (which is now the National Health Commission), which then oversaw China’s basic medical insurance systems, led the country’s first national-level price negotiations with pharmaceutical companies. These early negotiations targeted three drugs (tenofovir, gefitinib, and icotinib) and resulted in price reductions that were over 50%. However, the process was still ad hoc and without a formal HTA framework. Still, the success of these early talks laid the groundwork for more institutionalised processes.
Institutionalisation of HTA since 2018
The creation of the National Healthcare Security Administration (NHSA) in 2018 marked a turning point in China’s approach to drug price negotiation and reimbursement. For the first time, purchasing authority was centralised under a single national health insurance agency, enabling a more structured and evidence-based process for deciding which medicines to cover, and at what price.
Since then, the NHSA has overseen an annual update cycle for the NRDL. Each year, it issues a public call for drug nominations covering additions, removals, or price renegotiations, and requires manufacturers to submit pharmacoeconomic dossiers. These dossiers often include cost-effectiveness and budget impact analyses, aligned with the Chinese guidelines for pharmacoeconomic evaluation.
Submissions first undergo an initial review, which screens for clinical benefit. Selected candidates then proceed to a full HTA, conducted by experts from academia, convened by NHSA every year. During the full appraisal, two independent experts evaluate the clinical evidence, assess cost-effectiveness models, and estimate financial consequences for the insurance fund. Since 2021, appraisers also score each therapy on its degree of innovation and potential contribution to equity. These technical evaluations then inform confidential price negotiations between the NHSA and manufacturers.
The results have been significant. Between 2017 and 2023, more than 700 new drugs have been added to the NRDL, including many innovative therapies for cancer, rare diseases, and other high-burden conditions. In 2024, an additional 91 new drugs were added. Among these, 33 drugs were newly approved in 2024, securing NDRL listing the same year. The shift to annual updates has made China one of the fastest adopters of new medicines among middle-income countries.
Current challenges and future directions
Although China’s HTA process has become more coordinated, significant challenges remain. Unlike other countries, China has yet to establish a separate HTA institution. Instead, the NHSA directly oversees both the purchasing of health services and the technical appraisal process, relying on a network of affiliated research and academic institutions for support. Many HTA submissions still lack robust, high-quality Chinese data, and there is currently no explicit cost-effectiveness threshold to guide evaluations. Transparency, meanwhile, continues to lag behind international norms, with detailed appraisal reports rarely published. In addition, although pharmaceuticals now follow a relatively clear HTA pathway, formal processes for medical devices, diagnostics, and digital health technologies are still in development.
Looking ahead, further progress will be essential if China is to consolidate recent gains and achieve the goals set out in the “Healthy China 2030” vision. A priority will be clarifying institutional roles and establishing a solid legal foundation for HTA, ensuring that relevant agencies have clear mandates, stable funding, and proper accountability. Building capacity and improving technical standards will also be crucial. This could include expanding postgraduate HTA programs, encouraging mentorship across regions to reduce disparities in expertise, and refining methodological guidelines to promote consistency and rigour.
Enhancing transparency remains an important objective. Publishing HTA methods and detailed appraisal reports could improve the credibility of decision-making and build greater public trust. Routine reassessment of technologies, supported by real-world evidence, can ensure that pricing and coverage decisions remain aligned with actual value over time, enabling timely price adjustments or delisting when necessary.
Finally, broadening the scope of HTA will be critical to supporting value-based healthcare more comprehensively. Developing device-specific guidance in collaboration with the medical device regulator and extending HTA processes to include diagnostics and digital technologies will help ensure that decision-making reflects the full spectrum of medical innovation and meets the evolving needs of China’s health system.