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Speech by SHW at luncheon (English only)

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Following is the speech by the Secretary for Health and Welfare, Dr E K Yeoh, on the topic "Evolution in Health and Welfare in Hong Kong in the New Millennium" at the luncheon hosted by Director, HK Economic Trade Office in Singapore today (May 25):

"Evolution in Health and Welfare in Hong Kong in the New Millennium"

Clement, distinguished guests, ladies and gentlemen,

I am delighted to share with you today on the recent dynamics in the health and welfare sectors in Hong Kong. I have to also thank Clement for organising this forum so that I can have a chance to benefit from an intellectual exchange with a diversified audience in addition to attending the conference which started this morning.

Flying Dragon

But before I start, I am charged with an additional and very important duty. All of you should have received the lapel pin of a very lively flying dragon. The Flying Dragon is our new international brand which is a modern interpretation of a dragon incorporating the letters H K and the Chinese characters for Hong Kong. The flowing lines of the dragon also mirror Chinese calligraphy. This dual expression symbolises a blend of East and West that characterises Hong Kong. The dragon's smooth, fluid shape imparts a sense of movement and speed, communicating that Hong Kong is forever changing. The visual identity's dynamic and contemporary rendering captures Hong Kong's passion to be daring and innovative, and a can-do approach towards bringing visionary ideas to life. Hong Kong is Asia's world city, a natural gateway to new economic opportunities in the mainland of China and the rest of Asia. I can assure you the lapel pins are limited edition and there will be no more re-prints.

Now, let us take a ride with the flying dragon and see how the health and welfare sectors are doing in Hong Kong. Both the health and welfare sectors in Hong Kong have been undergoing an era of evolution these years. With the dawn of the new century, we are determined to take a strong foothold from which we can stride further forward to improve our systems. Since 1999, our community has been involved in a constructive and yet heated debate on the various reform measures to our health care system, when the report prepared by the Harvard consultants was published. With the community consensus on the need for reform, we soon embarked on a vigorous review of our health care system with a view to develop reform proposals that are in tune with the community values and aspirations. A consultation document was then published in December 2000, setting out the reform proposals for public consultation which just ended in March this year.

On the welfare side, it has not been an easy year either. With the augmenting calls for greater transparency and accountability of public spending as the backdrop, we have also embarked the course of welfare subvention reforms with the objectives of enhancing our responsiveness, improving quality, cost-effectiveness and efficiency - the key elements of an open and accountable government. I will revert to these reforms later.

Women's Commission

Early this year also saw the establishment of a new Women's Commission under my portfolio. We have all along accorded a high priority to women-related matters. One of our Policy Objective is to promote the well-being and interests of women in Hong Kong. Currently, there is a well-established machinery both within and outside the Government to handle the major women's issues and, many adminstrative and legislative measures are in place to cater for their needs. In addition, we continue to adhere to the principles in the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) by implementing various policies and measures and by fulfilling the objectives set out in the Beijing Platform for Action.

The Women's Commission is a high-level central body tasked with identifying women's needs and addressing issues of concern to women. It will take a strategic overview of women's issues and advise on the development of a long-term vision and strategies for the advancement of women. It will also advise the Government on integrating policies and intitiatives which are of concerns to women. In addition, it will keep under regular review services for women, identify priority areas for action and advise on the development of new or improved measures. I think it is best for Clement to organise another lunch so that I can talk to you more on the work of the Women's Commission.]

Envisioning Health

Now, returning to today's topic. Envisioning health and welfare for the new millennium is no easy task, as we faced with increasing challenges from all fronts - rising community demands and expectations, balance of interests in the community, advance in technology, opening up of the information world, and blurred national boundaries as a result of globalisation. However, as a caring, responsive and responsible government, we have to be visionary and creative in standing at the forefront of protecting and promoting health of our population.

In the consultation document on health care reform recently published for public consultation in Hong Kong, the following vision of reform is unanimously agreed to by the community - "To re-create a health care system which promotes health, provides lifelong holistic care, enhances quality of life and enables human development." Perhaps you may want to add the phrase "at the least cost" in the end of the sentence. This financing part may be dealt with later.

We do not intend to over-burden our health care system which seems to be the subject and the keyword in the vision statement in bringing health to our population. We in fact place equal, if not more, emphasis on holistic care, quality of life as well as human development. In addition, the health care system does not refer to a static framework which define and confine the activities of the players inside the system, but rather constitutes a number of different but crucial elements the interaction and dynamics of which count to the success, or level of achievement, of the system. In this system, I see different sectors and roles of the society being the key elements, or players. They include the policy maker, the health care provider, the practitioner, and the patient.

Policy Maker

First of all, policy makers will have a key role in perfecting the health care system. As defined in the World Health Report 2000, with which most of us are familiar, the performance of a health system is assessed by the level of achievement of certain defined overall goals, including the level of health attainment of the population, improving the distribution of health attainment, the level of responsiveness to the legitimate expectation of the population, the distribution of responsiveness and the fairness of financial contribution.

Although Hong Kong is not evaluated in the Report, my assessment is that our long held policy that "No one should be deprived of adequate care because of lack of means" has already manifest the outstanding achievement of equity of our health system. Some local social scientist coined the term Communitarian spirit to describe this special feature of our health system in the capitalist Hong Kong. But, one may ask, how about fairness of financial contribution? This what seems to be an equitable system in fact does not fairly treat the financially vulnerable or the needy with the adequate care.

It is against this background that we revisited our subsidy levels and mechanism. According to the New Universalism as defined in the World Health Report, which says, "Rather than all possible care for everyone, or only the simplest and most basic care for the poor, this means delivery to all of high quality essential care, defined mostly by criteria of effectiveness, cost and social acceptability." We are moving towards this new approach in one of our measures in improving the financing for health care. Government subsidy, which is scarce and limited, will and should target at the financially vulnerable and at those diseases that create great financial burden on the patient or his family.

Apart from the goals as defined by the World Health Organisation, I am much inclined to add in one more aspect to the health system, that is, the environment that is conducive to the conduct of activities by different players. Hong Kong has all along taken pride of its dual system of health care where both public and private health care providers function in a complementary way by providing patients with more choice and more efficient and reliable care and services. Take the example of managed care organisations. The advent of managed care organisations should not be viewed as a nightmare to patients nor a threat to existing health care providers. Policy makers should react to this new entity by crafting new regulatory measures that, on one hand, can protect patient rights and safety and ensuring quality of care provided, while on the other do not limit the growth of these organisations as one of the providers of health care.

Provider

I have just touched on the second key player of the health care system - provider. There are more and more different providers in the system, be it traditional medicine, Chinese medicine, or alternative medicine or homeopathy. The goal of health care is no longer confined to treatment of disease, but healing to health. Instead of symptomatic treatment or medical interventions, we talk more about how to maintain a healthy body and the rejuvenation of the mind and soul which in turn complement our health in a holistic sense. So the aims or goals and approaches of the different medicines mentioned just now can be viewed as spreading across a continuum. To me, traditional medicine emphasises treating an illness by technological interventions, such as drugs or laser, when such symptoms emerge and interrupt our daily lives. On the other hand, Chinese medicine stresses on "enduring the healthy state while furthering on new sources of health from within the body" (gu ben pei yuan) and look at the body as a system of functions. Yet, on the other end, homeopathy takes into account the serenity of mind and soul, and the interaction of them with the surroundings, i.e. nature, in achieving a healthy balance of the body. All these, though differ in names and approaches, share the goal of bringing an individual to a healthy state.

We can see at this point that the roles of health care providers are rapidly broadening and deepening; and at the same time they are facing with a diversity of challenges that have never happened before and that are brought about by the heightened free flow of information and intense competition brought about by globalisation. Roles of providers become multi-dimensional. They do not serve only as service provider, but also health advocate, care manager, policy advisor, data collector, knowledge navigator, technology manager, wellness coach, academic scientist, medical ethicist, and health economist.

In the near future, the mode of health care delivery in Hong Kong will be shifting to a community-focused and patient-centred model in which a multi-disciplinary and multi-dimensional approach will be adopted in providing health care around people's homes. We promote the collaboration and involvement of expertise from various fields according to the needs and conditions of the patient.

Practitioner

Next, I come to the third key player, practitioner, who, very often, has the closest contact with the last player, patient. The traditional standards of measurement of professional capability and effectiveness of a medical practitioner, i.e. scientific, legal and ethical criteria, are about to be refined. What is being added into the equation is the standard of interpersonal communicative skills. As health care continues to grow and improve, we are moving towards a more patient-centred approach whereby the patient's physical, mental and spiritual well-being have to be taken into care. Practitioners could no longer refer to the old book or the lecture's notes for "next steps" or "what-to-do"s. Instead, they have to be more creative in delivering health care by becoming more accommodating in understanding patient's needs; more articulate in communicating with patients and families about the treatment and procedure. Before doing so, they should be equipped with a much broadened curriculum, covering social sciences, behavioural science and communication skills and techniques. In short, successful practitioners of today have to go through a long and steep, and sometimes multiple, learning curve.

We have therefore encouraged our health care practitioners to undertake continuing medical education and professional development in order to keep themselves abreast of the latest knowledge and skills in discharging their duties. And I believe, the dynamics of such skills can manifest and proliferate according to different individual and profession.

Patient

Last but not least, patient is another key, but perhaps not prominent, player in the health system. In fact, the role of and contribution from an individual should not be under-estimated. They can be very significant and crucial before one really becomes a patient. Through educational and promotional efforts, individuals should be made aware of the importance of having a healthy lifestyle and should be encourage to adopt health-promoting behaviours, such as regular exercise and proper dieting, while refrain from health-aversive behaviours such as smoking. These are all easier said than done, but must be done, although it is a lifelong process and may take years or even generations. Health care is no longer a "not-in-my-backyard" issue. It is a personal responsibility which requires crystal-clear awareness and determination, and heavy involvement of an individual.

To conclude, the actualisation of the vision for health will have to count on the interrelationships and interactions of all different players in the health system; the interconnectedness of the various sciences, all of which progress with time and we should not allow ourselves to lag behind.

Envisioning Welfare

I wish now to turn from health to welfare and outline some of the key features of our welfare programme, in particular recent reforms.

It may surprise some of you that Hong Kong, a bastion of a free economy, has a well-developed welfare system, comparable to any in Asia. It has developed from the provision of basic relief by religious and philanthropic organizations to a continuum of preventive, developmental, supportive and remedial services as well as a safety net in the form of social security. Family and child welfare services seek to preserve and strengthen the family unit and provide an environment suitable for the physical, emotional and social development of children. Youth welfare services aim to enable young people to become responsible and contributing members of the community. Elderly welfare services seek to promote the well-being of elderly people. Rehabilitation services aim to enable those with a disability to develop their potential and participate full in the community. Social security provides for the basic and essential needs of individuals and families who are in need of financial or material assistance.

In 2001-02, recurrent expenditure on welfare will be S$7 billion (HK$30.2 billion), representing 13.8% of the total recurrent expenditure and a four-fold increase over that in 1992-93. Of this, direct welfare services account for S$2.3 billion (HK$9.8 billion). The majority of our direct welfare services are delivered by over 180 NGOs through Government subventions. Subventions to NGOs will be S$1.7 billion (HK$7.2 billion), representing 73.5% of our direct welfare services and a four-fold increase over that in 1992-93.

Reforms

Worldwide, increased public scrutiny has called for greater transparency and accountability of public spending, including subventions to NGOs. We will not be an exception. Our welfare subvention system has long been criticised as inflexible, complex and bureaucratic. It focuses on tight control over input, rather than on output or, more importantly, outcome. There is insufficient competition in the provision of welfare services. It also falls short of meeting changing community needs in a timely manner. In short, it is no longer meeting in full the needs of present-day social welfare development.

For the above reasons, welfare subvention reforms are being pursued with the objectives of enhancing our responsiveness; improving quality, cost-effectiveness and efficiency; encouraging innovation; and strengthening accountability and transparency. The key components in our package include -

(a) Service Performance Monitoring System for evaluation of performance;

(b) Lump Sum Grant subvention mode;

(c) Planning Mechanism providing a discipline and mechanism for structured decision-making to meet the mission and goals; and

(d) Competitive Bidding for allocation of new welfare service units.

Service Performance Monitoring System

An improved service monitoring system should be in place to enable performance to be evaluated against a set of well-defined standards. The enhanced Service Performance Monitoring System (SPMS) has been introduced progressively since 1999-2000. This is now applied across the broad to all service units operated by NGOs as well as the Social Welfare Department (SWD). Performance of service units receiving Government subvention is assessed based on the Fund and Service Agreements (FSAs) drawn up for each of the subvented services and evaluated against a set of well-defined Service Quality Standards (SQSs). In the light of experience and feedback, we recognise that the current generation of service-specific FSAs and process-based SQSs will need to be re-examined and streamlined to provide a more agency-specific basis for collaboration between SWD and NGOs in the future planning and delivery of welfare service. To this end, we are now working closely with the representatives of NGOs.

Lump Sum Grant

Under the Lump Sum Grant (LSG) subvention mode (an improved funding system), SWD will no longer impose input controls with regard to staffing structures, levels of pay and individual items of expenditure. NGOs will be given flexibility in the deployment of funds to meet the service needs, as long as the required objectives, outputs, results and standards are met.

While we do not at this stage require all NGOs to move on to LSG on a compulsory basis within a specified timeframe, it remains our policy objective for all NGOs to be funded on a LSG basis. The LSG subvention mode was implemented as from 1 January 2001. 95 NGOs switched to LSG in 2000-01. They represent 55% of subvented NGOs and account for 75% of the total Government recurrent subventions to welfare NGOs. Another 38 will join LSG in 2001-02 and 2002-03. We envisage that most, if not all, NGOs will jump on board within the coming four to five years.

We regard the switching to LSG as a crucial step in our reforms. It is a milestone at which SWD starts to move away from micro-managing NGOs' affairs, the NGOs' boards and management have to strengthen their corporate governance, and there is a shift of paradigms in the welfare sector and increasing readiness to accept change. To facilitate a smooth transition, a post-implementation monitoring mechanism involving SWD, NGOs and representatives of staff groups and user groups have been put in place and a Help Centre has also been set up to provide the needed advice, guidance and support.

Planning Mechanism

The objective of the improved planning process is to provide a discipline and a mechanism for structured decision-making on how welfare services can be best engineered to meet the changing needs of the community and on how resources can be used in the most cost-effective manner. We are putting in place an integrated and forward-looking planning framework comprising long term Strategic Directions, Medium Term Plan for individual programme areas and service development, and delivery of Annual Plans by SWD and NGOs. The Strategic Directions will set out the long-term directions of social welfare services in Hong Kong. The Medium Term Plans will provide a three to five year outlook of the service development under each programme area, relating to objectives and key result areas. The Annual Plans will be drawn up by service providers, including both SWD and NGOs, in a holistic manner reflecting the latest policy objectives and priorities. In line with the partnership approach, HWB and SWD will be working with NGOs in taking forward this initiative to develop a more robust planning mechanism.

Competitive Bidding

The objective of competitive bidding is to introduce a transparent and fair system to secure innovative and value-added services, to enhance quality of service, and to achieve cost-effectiveness.

Under the old system, there is no need for NGOs to compete on pricing for allocation of new service units and, once allocated the service, they are certain of continued support from the Government. Thus, the sense of "perpetual ownership" and lack of competition may dampen any incentive for operators to enhance cost-effectiveness in managing resources and improve services to meet the ever-changing needs.

In the 1999 Budget Speech, the Financial Secretary announced, inter alia, that instead of allocating new service units to NGOs who would have to operate under rigid subvention rules and procedures, the Government intended to open up new welfare service units for competitive bidding, on a price and quality basis, starting with the home help service for the elderly.

This pilot project commenced in the latter part of 1999. It involved the re-engineering of new home help teams into separate meal and home care service contracts. The meal service contracts were awarded through an open tendering process based on price and quality, and the home care service contracts were awarded through competition on price and quality amongst NGOs. We have now completed a comprehensive review of these contract services.

In the light of the successful outcome of the pilot project, we believe that all elderly services, from home care to residential care, are suitable for private sector participation. We intend, therefore, that competitive bidding should be applied to these services. We will ensure upkeeping and even enhancing the quality of service under competitive bidding, through the assessment of bids and monitoring to ensure full compliance of contract terms. We will continue to listen to the views of the welfare sector and work closely with them in finalising and improving the system.

Conclusion

Given the rapid social and economic changes, one must be determined to move with time and prepared to shift the paradigm and accept new way of thinking. Only in this way will we be able to deliver our mission of building a caring community so that all people, including the needy, the disadvantaged, the vulnerable and those with a disability, can develop their potential to the full, thereby enabling the society to flourish in a healthy environment.

Thank you.

End/Friday, May 25,2001

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