Objective: to improve the use efficiency of medical resources and alleviate the uneven distribution of medical resources, study the operation mechanism of two-way referral in the model of Medical Federation, so as to promote the rational distribution of medical resources and improve the use efficiency of medical resources. Methods: Based on the evolutionary game model, we dynamically analyzed the evolution trend and the game equilibrium between the core hospitals and the member hospitals. Results: the effect of two-way referral mechanism is closely related to government subsidies, medical insurance reimbursement, resource allocation and bilateral interests. Conclusion: to improve the subsidy mechanism of medical insurance reimbursement, to make the two-way referral mechanism in the Medical Union and take incentive measures can effectively improve the operation of the referral mechanism, and ensure that the profit of the upper and lower level hospitals is the prerequisite for the implementation of the two-way referral mechanism.