I have been promoting my version of public health insurance since 1997, when I first published my book Health Care Financing and Delivery: A Model for Reform. Since then I have improved the design of the scheme over the years, and have written on the subject in the local press multiple times. But the ideas have so far not been taken up by the government. Thus it is normal that the government will not “listen to” our pleas. First of all there are many stakeholders in society: It is impossible for the government to “listen to” every stakeholder’s pleas, if “listen to” means adopt the policy proposal as presented. Professor Nelson Chow of the University of Hong Kong could not get the government to adopt his public pension plan; I could not get the government adopt my public health insurance plan; Professor Richard Wong of HKU could not get the government reinstate his proposal for selling public housing. The government has to consider many things including long-term sustainability of the proposal, the impact on different stakeholders, administrative feasibility, political feasibility, etc. But I know the government does listen. If an idea is good for society, persevering will have a good outcome. Over the years, the government has introduced bank deposit insurance, the minimum wage, income subsidies for low income families, etc., all of which I had argued for in the past.
So here I am again, trying to sell an idea that I still think is good for Hong Kong.
First of all, the basics. I have argued that medical security for citizens is the responsibility of every government. This means that citizens have access to timely, reliable, and the best healthcare services society can afford. The best healthcare services do not have to be luxurious. If someone who wants more luxury or more choices, one can seek private healthcare that offers such. The private healthcare system should be an option for those who can afford it, and must not be the only avenue available for life-saving healthcare.
I argue that presently our healthcare system has failed to deliver such medical security to its citizens.
Now my public health insurance proposal:
I have called my public health insurance scheme “excessive burden protection.” It automatically covers all Hong Kong citizens.
Under the plan, all fees and charges for healthcare services will be raised to cover the direct costs arising from the care (i.e., not including fixed costs, which are funded by the general revenue). Each citizen’s eligible medical expenses in the calendar will be recorded, and as soon as they reach the “self-funded threshold” the government will pay for all such expenses for the rest of the year.
I would rather have the government save the money and improve the public healthcare system. Private healthcare should offer the extra luxury and choice that those who can afford it can have, but the public healthcare should be funded adequately, with both government revenue and fees and charges, to ensure medical security to all citizens
The self-funded threshold varies with the age of the citizen, reflecting the higher expected cost of care with age. But for each age category, it is reduced for those who pass a means test. For those on the Comprehensive Social Security Assistance the self-funded threshold still applies, but CSSA stipend will be raised to reflect the expected medical expenses. This design will ensure that CSSA recipients will not be over-burdened. Indeed if they are healthy and rarely use public healthcare facilities they will have more disposable income. Under the Voluntary Health Insurance Scheme (VHIS) that was announced by the SAR government last month, the insurance premiums for those at age 65 range from about HK$7,000 to HK$21,000 per year — much higher than those for the young. While these payments are tax deductible they will have to be paid year in year out regardless of the health conditions and the claims of the insured person, and they will continue to rise with age. Under the public health insurance, no premiums are payable, and payments up to the threshold are payable only when eligible expenses are incurred. Under the VHIS, outpatient services are not covered, so over and above the premiums paid there will be additional medical expenses. Under the public health insurance all eligible outpatient expenses are counted, and no additional spending will be necessary beyond the thresholds.
Some people had objected to my proposal for raising fees and charges over their present levels. My answer is that if people can afford it, they should pay their fair share. This way the government will have more resources so that timely, quality care can be provided.
Some people had objected to my proposal to raise the self-funded threshold for older people. This is necessary because healthcare costs for the elderly are many times more than those for the others. Indeed, even though the threshold is raised for the elderly, the government’s subsidies for old people are much higher than those for other age groups.
The government has launched the VHIS, and its tax deductibility does represent a burden on the government. I would rather have the government save the money and improve the public healthcare system. Private healthcare should offer the extra luxury and choice that those who can afford it can have, but the public healthcare should be funded adequately, with both government revenue and fees and charges, to ensure medical security to all citizens.
The author is the dean of business at the Chu Hai College of Higher Education.
HONG KONG NEWS