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Health care: those who can pay, will pay

I am going to say something politically incorrect towards the end of the column, but first let me wade into the health care finance debate. We are all familiar with Hong Kong's problem. I believe the solution is two-pronged: first, apportion more of the health care burden to the private sector by reducing some non-emergency and highly specialised services in public hospitals; and second, change the public mindset from 'entitlement' to 'user pays'.

The Bauhinia Foundation's plan for a mandatory medical savings scheme forces citizens to put money aside for future medical bills. The problem is that, unlike the Mandatory Provident Fund, the time when the money will be needed, and how much, cannot be predicted. A few people will never need it; for those who do, the chances are that it will not be enough.

The plan also basically contravenes the user-pays principle, since everyone would pay the same, regardless of use. And it would involve high administrative costs due to the constant stream of withdrawals.

The foundation also recommended a three-pillar system - three tiers of health care with varying degrees of government subsidy. The problem with such a complicated system is the proverbial 'devil in the details'. All therapeutic treatments affect the well-being of an individual, and it is difficult to rank them in order of importance.

It makes more sense to put the money into a universal insurance plan that provides basic medical coverage in public facilities for every Hong Kong citizen. Offering tax rebates would encourage citizens to buy additional insurance that allows them access to private doctors as well, shifting more of the workload away from public hospitals.

Currently, insurance companies' schemes are open to abuse, but a tailor-made and revamped universal insurance plan would be more versatile and flexible than mandatory medical savings. And, most of all, it follows the user-pays principle.

In theory, health care funded by taxes is more cost-effective than that funded by private insurance, because the latter involves high costs associated with developing packages, marketing, processing claims, salaries for top executives and the inevitable profit imperative. On the other hand, health care funded from taxes is wrought with the usual bureaucratic baggage and, in the case of our Hospital Authority, unreasonably high salaries for many senior doctors.

Our public hospitals under the Hospital Authority could probably trim the massive budget by cutting administrative costs, retiring senior doctors and streamlining operations. We do not need centres of excellence in every public hospital. Centralisation of services is always more cost-effective. Highly specialised services and expensive equipment should be available only in hospitals associated with our two medical schools.

Pursuing the user-pays principle, such specialised services could be financially self-sufficient if appropriate charges were levied on those who can afford to pay. How about building private university hospitals, run by the two medical schools? They are common overseas and could provide health care by top doctors for paying patients, thus setting the stage for the public-private health care interface often touted by the government.

Despite government hospitals' reputation for high standards, most patients who can pay opt for private hospitals.

Thus, although it is difficult to put a price tag on a human life, people with money will always be able to buy better things than the poor, and that includes health care.

Finally, one more quibble about the foundation's report: it should have avoided terms such as 'income-related hypothecated health tax', 'intergenerational equity', and 'evidence-based age-specific health screening and early detection services'. Unless we use plain language in an honest dialogue, we cannot even begin to have a rational debate on health care finance.

Feng Chi-shun is a consultant pathologist at St Paul's Hospital

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