Objective:-To-learn-the-economic-performance-of-public-medical-institutions-in-Songjiang-district-of-Shanghai-before-and-after-the-separation-of-revenue-and-expenditure.-Methods:-Financial-statements-of-public-medical-institutions-were-collected,and-the-designed-questionnaires-were-filled-by-district-health-bureau.-Results:-After-the-implementation-of-separation-of-revenue-and-expenditure,public-medical-institutions-in-Songjiang-district-had-not-only-gained-steadily-increase-of-financial-assistance,out-patients-and-emergency-patients,-but-also-realized-significanty-decreasined-percent-of-operating-income-and-expense-per-out-patient-or-emergency-patient.-However,public-spending-remained-at-high-level-and-financial-deficit-of-medical-service-still-existed.-Conclusion:-Separation-of-revenue-and-expenditure,which-is-a-kind-of-government-dominating-health-investment-mechanism,has-ensured-good-development-of-public-medical-institutions,facilitated-its-return-to-commonweal,and-made-it-possible-for-implementation-of-basic-drug-system.-However,public-medical-institutions-should-strengthen-budget-management-and-control-operating-cost.