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The Government today (Monday) published for public consultation the consultancy report on Hong Kong's Health Care Financing and Delivery System.

The 500-page report is produced by the Harvard University Consultancy Team, headed by Professor William Hsiao. The team was commissioned by the Health and Welfare Bureau in November 1997 to review Hong Kong's current health care system, to assess the capability of the present financing arrangements to meet future needs, and to recommend some viable reform options.

In its report, the Harvard team has set out its assessment on the strengths and weaknesses of Hong Kong's current health care system.

On strengths, the team found out that Hong Kong had a relatively equitable system whereby all enjoy good access to essential health care regardless of their financial means. Good improvements have also been made in recent years to the service quality and cost-effectiveness in the public hospital system. While the system has been praised for its cost-effectiveness when compared to certain European countries, the consultants said however that it became less certain when Hong Kong was compared to its Asian neighbors.

As regards weaknesses, the consultants pointed out that the quality of health care in Hong Kong was highly variable. The long term financial sustainability of the current system is highly questionable, having regard to the aging population, the increased costs associated with adoption of new technology and the rising public expectation for quality services.

They believed that an increasing share of the public health budget by health care services would in due course reduce the resources for other competing demands in areas such as education, welfare, housing and infrastructural development.

The team also considered Hong Kong's health care system as highly "compartmentalized", i.e. there was a lack of coordination and cohesion among primary, in-patient and community medicine, and between the public and private sectors. This had resulted in duplication of services, waste of resources, and discontinuity of services.

Based on their findings, the Harvard team proposed a number of options but considered that Hong Kong should adopt a Health Security Plan (HSP) and a Savings Accounts for Long term Care (MEDISAGE).

The HSP requires the employers and employees to jointly pay 1.5-2 per cent of the employees' wages as premiums. A Health Security Fund Inc. would be set up to negotiate with health care providers for the establishment of standard payment rates, covering in-patient services and specialist out-patient services for certain chronic diseases. The public will still need to pay for the general out-patient services by their own.

Under the plan, patients can choose between public and private health care providers, who, after providing the service, will be paid the standard rates by the Fund. This concept of "money follows the patient" will greatly enhance the patients' power to choose the providers they prefer.

As regards MEDISAGE, the employers and employees will jointly contribute one per cent of the employees' wages to the employees' individual savings accounts. The contributions will be centrally invested.

When the individual reaches the age of 65, funds from his/her savings accounts must be withdrawn and used to purchase a long term care insurance policy, providing the individual, where needed, with residential care and home care services. If the individual dies before reaching 65, the accumulated fund in his MEDISAGE account will become part of his/her estate.

In both HSP and MEDISAGE, the Government will subsidize the lower-income groups and the unemployed for the payment of premiums and their contributions to the savings accounts.

In the long term, the Harvard team believed that the most appropriate structure for Hong Kong would be the establishment of an Integrated Health Care system.

This system envisages that health care providers and institutions can form themselves into 12 to 18 regional health care organizations, with the appropriate in-patient, out-patient and specialist expertise, providing a comprehensive range of health care services, including preventive, primary, out-patient, in-patient and rehabilitative services.

This delivery arrangement will remove the "compartmentalization" inherent in the current health care system, and improve the quality of health care and cost-effectiveness.

Commenting on the report, a spokesman for the Health and Welfare Bureau said, "We are most concerned about the financial sustainability of our health care system and there is a need for us to explore alternative ways of financing without compromising quality and accessibility.

"We hope that the Consultancy Report would serve as a vehicle to stimulate a constructive and in-depth discussion on this important subject within the community.

"The Government at this stage is completely open-minded on what health care reforms should be adopted.

"Regardless of what reform measures we are to introduce, we shall continue to uphold its long standing policy that no one would be denied adequate medical care through lack of means," he added.

The spokesman called on the public and all concerned parties to study the Report and put forward their views on the way forward before 15 July 1999.

"We shall collate and analyze the public comments and suggestions received, and prepare an official consultation document setting out Government's proposals. We shall further consult the public on the preferred reform options," he added.

The full report can be accessed via the Health and Welfare Bureau website : http://www.info.gov.hk/hwb/. It will also be available for public inspection in the major public libraries.

Copies of the Executive Summary of the report are available from the District Offices of the Home Affairs Department, the Health Info-World in the Hospital Authority Building, Patient Resource Centres in major public hospitals, and general out-patient clinics of the Department of Health.

Comments and views can be sent either by mail to the Health Care Review Task Force, Health and Welfare Bureau, 19-20 Floors, Murray Building, Garden Road, Central, Hong Kong; by fax (2840 0467); or via e-mail (hcf1999@hwb.gcn.gov.hk) on or before 15 July 1999.

END/Monday, 12 April 1999

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