Health insurance is next important reform for Hong Kong

PUBLISHED : Thursday, 27 September, 2012, 12:00am
UPDATED : Thursday, 27 September, 2012, 2:36am

Reform of health-care financing is becoming one of the most talked-about of issues that haven't been resolved. Circumstances have conspired to relegate it to a lower priority over the years as the government has become preoccupied with financial crises, Sars, swine flu and - more recently - housing needs, national education and income disparity. The previous government planned to implement voluntary health insurance by 2015. People will believe that when they see it.

It is good that the medical profession reminded the new government of this when 30 leading representatives called on Chief Executive Leung Chun-ying to discuss health issues last week. Their wish list included a tax incentive to buy medical insurance to help kick-start financing reforms.

The cost would come on top of the government's huge bill for heavily subsidised public-hospital health care for everyone. But health insurance serves the need for those who can afford to pay more - for the option of private treatment - to do so. That would free up public hospitals to focus on teaching, treating the poor, major surgery and acute care. It would also lead to better use of resources, instead of public hospitals caring for 90 per cent of local patients with only 40 per cent of our doctors.

Health insurance is, therefore, important to reforms needed to maintain a high standard of care for an ageing population, including better interaction between the public and private sectors. The previous government also proposed a statutory authority to regulate private health services to ensure transparency, competition and higher standards. It would also promote voluntary insurance to young people as health savings with a 30 per cent discount on premiums later in life.

A tax incentive is targeted at those who earn enough to be able to afford to pay more. In terms of the economic benefit of more efficient use of health-care resources, this is more defensible than a HK$6,000 cash giveaway to everyone, regardless of means, to relieve the government's embarrassment at its overflowing coffers.