AstraZeneca

Executive Summary

The Recommendations of the Central Committee of the Communist Party of China for Formulating the 15th Five-Year Plan for National Economic and Social Development, adopted at the Fourth Plenary Session of the 20th Central Committee of the Communist Party of China (CPC), call for “advancing the ‘Healthy China’ initiative” as a strategic priority. General Secretary of the CPC Central Committee Xi Jinping emphasized that “people’s health is a key indicator of China’s progress towards building a modern socialist society.” 2 The World Health Assembly (WHA) has recognized rare diseases as a global health priority. 3 The issue of rare diseases has therefore increasingly attracted widespread attention from the international community. The total population of rare disease patients in China is estimated to exceed 20 million. 4 Owing to the inherent complexity of rare diseases, difficulties in achieving timely and accurate diagnosis, and the scarcity of effective treatment options, patients generally experience significant health and economic burdens. Advancing the “Healthy China” initiative in the 15th Five-Year Plan period requires more equitable, accessible, high-quality, efficient, and affordable health and medical services for rare disease patients. At the same time, improving reimbursement capacity for high-cost rare disease drugs will not only address key bottlenecks in the development of innovative drugs, but also promote the growth of biomedicine as a strategic emerging industry, thereby building new competitive advantages for industrial development during the 15th Five-Year Plan period.

In recent years, through coordinated policy measures implemented by multiple central government ministries and agencies, China has made significant progress in rare disease prevention, treatment, and coverage. Such progress includes the establishment of a Multi-Tiered Medical Security System (MTMSS), in which Basic Medical Insurance (BMI) serves as the core pillar for insurance coverage, medical assistance functions as a safety net, and other mechanisms, including the supplementary medical insurance, Commercial Health Insurance (CHI), charitable donations, and medical mutual aid, are developed in a coordinated manner to provide additional coverage. However, at the current stage, the MTMSS still exhibits significant gaps for rare disease patients, underscoring the urgent need to establish a unified and systematic institutional framework at the national level to further enhance overall medical insurance coverage for patients with rare diseases. More specifically, the “basic coverage” mandate of the BMI limits its capacity to provide coverage for high-cost rare disease drugs, while regional disparities in benefit packages mean that some rare disease patients continue to face “last-mile” barriers to accessing needed medications. As for CHI, due to its profit-oriented risk management considerations, it is limited in its capacity to serve as a primary form of coverage for rare disease patients. Meanwhile, charitable donations, constrained by their limited funding and their operational models, struggle to provide stable and sustainable coverage.

A review of rare disease coverage systems across different countries suggests that the establishment of a dedicated rare disease fund to centrally manage payments for high-cost rare disease drugs is an extremely valuable model for China to learn from in its effort to optimize the MTMSS for rare disease patients and enhance payment capacity for high-cost rare disease drugs. In addition, as a result of sustained socioeconomic growth, China has reached a level of economic capacity that would support the establishment of a dedicated fund for rare disease coverage. In recent years, several economically developed regions in China have already taken the lead in piloting dedicated rare disease funds, demonstrating the practical feasibility of this approach.

Drawing on international practices in rare disease coverage, the outcome of domestic pilot programs, and the existing foundation of China’s MTMSS, this paper recommends that China progressively advance towards the establishment of a national dedicated fund for rare disease coverage. China could combine nationallevel coordinated design and regional pilot programs in its effort to establish a national dedicated fund for rare disease. While completing the top-level design and preparatory work for the dedicated fund at the national level, pilot programs may be launched in regions where rare disease prevention and treatment systems are relatively well developed. Regional pilot programs conducted under national-level unified guidance can lay a solid foundation for the nationwide rollout and coverage of a dedicated fund for rare disease coverage.

(I) Drawing on international practices in rare disease coverage, the outcome of domestic pilot programs, and the existing foundation of China’s MTMSS, the design and implementation of a national dedicated fund for rare disease coverage could focus on the following aspects:

●The dedicated fund could clearly define the government departments responsible for nationwide fund oversight, management, and operation, while establishing systematic institutional arrangements across key steps in the process, including financing, access, payment, settlement, and evaluation, thereby ensuring a fund management model that is regulatable, sustainable, and traceable.

●The dedicated fund could establish stable and sustainable funding sources, for instance drawing from multiple channels, such as central fiscal allocations, public welfare lottery fund income, and donations from philanthropic organizations. The required funding scale may be calculated by referencing the number of diseases covered by the National Rare Disease Catalog, and the number of patients registered in the National Rare Disease Direct Reporting System.

●At the national level, China could establish an expert committee to provide systematic review and evaluation for drugs intended to be covered by the dedicated fund, and to clearly define the drug categories and rare diseases that should receive priority coverage. To address the challenge posed by small patient populations in drug value assessment, authorities may consider adopting a more flexible framework when assessing the drugs intended to be covered by the dedicated fund.

●The dedicated fund could be allowed to enter innovative payment agreements with pharmaceutical companies and adopt financial outcome–based payment models to establish risk‑sharing mechanisms for high‑cost drugs, while setting a cap on individual out-of-pocket expenses. This mechanism not only keeps the patient financial burden within an affordable range but also strengthens the budget predictability and long-term sustainability of the fund.

●The dedicated fund could establish a mechanism to coordinate with the BMI, thus ensuring synergy and complementary coverage across the MTMSS. This would provide rare disease patients with continuous coverage throughout their entire life cycle. Real‑world data collected during the implementation of innovative payment agreements can be used to assess the clinical value of rare disease drugs and their budgetary impact on the BMI fund, thereby providing evidence to support these drugs’ participation in National Reimbursement Drug List (NRDL) negotiations.

(II) Under national unified guidance, China could select regions with relatively well-developed rare disease diagnosis, treatment, and prevention systems to pilot dedicated funds for rare disease coverage. Such pilots could provide replicable and scalable practical experience for the nationwide roll out of the dedicated fund.

Drawing on reform experience in the medical insurance sector, conducting local pilots in parallel with the development of a national policy framework can help identify potential challenges at an early stage and accumulate practical implementation experience. Therefore, while the design for a national dedicated fund is still in development, dedicated fund pilots may be launched in regions with well-developed rare disease diagnostic and treatment capacity, covering fund size estimations, real‑world data collection, and innovative payment agreement attempts. Regional dedicated fund pilots can help validate and strengthen the national-level fund design, ensuring that the national dedicated fund for rare disease is grounded in China’s specific context and tailored to the realities of rare disease diagnosis and treatment in China.

Download the full report：Improving the Medical Insurance System for Rare Diseases to Support the Achievement of the Strategic Goal of Health for All