The elimination of drug price addition is the core of the pharmaceutical reform in the new medical reform. The drug price addition policy which has taken over 60 years will be completely eliminated. This article sorts out the historical background and reforms of the drug price addition policy, and analyzes the contribution of the drug price addition policy to the development of public hospitals in China during a certain historical period. Also, we notice the negative impact of the drug price addition policy on “taking drugs to support medical care” and exacerbating the “expensiveness of visiting the doctor”. We summarize the challenges brought by the elimination of the drug price addition policy in the new era to the public hospitals’income, operating efficiency and the cultivation of talents in the pharmaceutical sector. For public hospitals at all levels in the reform of “drug price zero?addition”, they encountered real problems such as the change of income model and the frustration of the enthusiasm of medical personnel. We give targeted countermeasures and suggestions in order to improve the operation and management of public hospitals and seek for more long-term development.