The National Health Insurance Administration (NHIA) has announced the results of this year’s (2024) drug price adjustment, revealing a reduction in expenditure by NT$5.53 billion. A comprehensive review of 14,000 items was conducted, resulting in the maintenance of prices for 9,500 drugs, while adjustments were made for 4,500 others. Notably, this year’s adjustment marks the lowest number of items with price changes since the implementation of the Drug Expenditure Target (DET) in 2013.
The NHIA announced that the Drug Expenditure Target (DET) was introduced in 2013 on a trial basis. Under the global budget system, DET activates a price adjustment mechanism when actual drug expenditure exceeds the annual target. In the subsequent year, items with prices exceeding a predetermined range identified by a drug price survey become subject to adjustment. These adjustments consider essential medicine items, price reduction, and minimum price protection to ensure a stable drug supply. The NHIA emphasized that drug price adjustment is an annual routine. In cases where the adjusted price doesn’t sufficiently cover costs, pharmaceutical companies have two weeks from the announcement to submit price suggestions along with a cost analysis, as outlined in Article 34 of the NHI Pharmaceutical Benefit and Reimbursement Scheme.
As the medical technology advances, the NHIA introduces new drugs every year to improve the accessibility of medicines for all the insured. Adjusting drug prices allows the NHI to have spare funds to include new drugs in the package, ensures sustainability for the NHI, and improves the health for all the insured. The NHIA is also working on reforms of NHI policies on medicine and drafting subsidy and incentive programs for Taiwanese pharmaceutical companies to invest in or expand their production lines. The aim is to create a win-win-win situation of reasonable drug price adjustments, fostered domestic manufacturing of generic drugs, and medication safety for the public.