At present, China has achieved an initial establishment and gradual implementation of a framework for national essential drugs policy. With the further implementation of the national essential drugs policy, it is not clear how the policy works, whether it achieves the original intention of essential drugs policy, and what impact essential drugs policy exerts on the primary health care system. In view of it, we conducted a field research on sample areas of Shandong Province to understand the conditions of the implementation of the essential drugs policy in Shandong Province. From three perspectives of medical institutions, patients and medical staff, this thesis analyzes the impact of essential drugs policy on village-level and township-level health service system, summarizes the effectiveness of implementing essential drugs policy, discovers the problems of various aspects and conducts an in-depth analysis of the causes, and puts forward feasible suggestions to provide reference for improving the essential drugs policy. The assessment results show that the implementation of essential drugs policy in Shandong Province has played a positive role in promoting the sound development of the primary health care system, changed the situation of covering hospital expenses with medicine revenue in the past, contributed to the return of medical institutions to public welfare, and reduced the patient's economic burden of disease. But there emerge many problems as follows: impact on the doctor's diagnosis and treatment due to incompleteness of drug types, and distribution not in place, patient loss and operational difficulty of village clinic. Thus, this thesis makes recommendations of drugs catalog formulation, drug procurement, sales and use, and meanwhile points out that the supporting financial compensation policy and performance appraisal policy and other measures in place are a prerequisite for a positive role of essential drugs policy.