2 May 2000

Savings versus Insurance in Health Care Reform

(Keywords: health care reform, Green Paper, savings, insurance, affordable pay concept, primary health care)

          The possible imminent delivery of the long awaited Green Paper on Health Care Reform has sparkled much rumours on its contents. Irrespective of whether these rumours are speculations or "leaks" to test the temperature, it looks as if Government is set to impose a "shared responsibility for health care between the users and the Government". How much would be the "users' share" in public medical services, and through what span of time to achieve that "share" remains to be seen.

          The medical profession is in full support of this "affordable pay principle" as the current next to free for all services for all irrespective of wealth is leading the public system to a disaster. Needless to say, along with the "affordable pay" concept, Government must assure the public in no uncertain terms that it will not reduce its current level of health care budget, nor would it shirk its responsibility to the poor and indigent in providing the best of available health care.

          Nevertheless, it will still be an uphill battle for Government to secure a complete round of approval. For with elections round the corner, few politicians will be "game" enough to support any fee charges, which is guaranteed to be a vote deterrence.

          With the introduction of "affordable pay", any good Government would need a proper machinery to "assist" the public to pay. Rumours are that two formulae would be proposed in the Green Paper -- a mandatory medical savings account scheme and a compulsory contributory insurance scheme, with an inclination towards the former.

          A savings account scheme does have the benefit of preventing abuses. After all, what one contributes is what one can use, no more and no less. In short, it is an individual account for which the maturity of the account -- the time that a workable savings to be accumulated for any significant contribution to health care cost -- depends very much on one's income and the compulsory savings percentage.

          With the Mandatory Provident Fund just round the corner, any health care contribution of significance may well be a burden that many will not be able to shoulder. Then there are the active "unemployed" -- housewives, school children etc -- whom we cannot and should not ignore!

          A compulsory contributory insurance scheme has the beauty of being a "risk sharing" mechanism. With a sizable critical mass as the basis of a pool, even a fairly small contribution from each individual could kick start a workable scheme in the shortest possible time. The downside: abuses and unnecessary over-utilisation. Furthermore, in essence, it is a scheme of the healthy subsidising the doctor's fees of the sick!

          There is a possible third option. Government should make all efforts to stimulate the taking up of private medical insurance schemes. With 26 % of the population already taken up one form or another private health insurance, mainly as cooperate employees' benefit, this could become the mainstream direction for an alternate health care funding source for hospital base treatment.

          A mandatory contributory insurance scheme, with a contribution of 0.5 to 1% of emolument to cover primary health care, should be introduced at the same time. Yes, private primary health care today is affordable to most. Yet, there is no guarantee that it would remain so in the future. It is always a good motto to make hay while the sun shines.

          It has been said that a "well begun is half done". In the issue of health care reform in Hong Kong, the Government can do no worse than to begin by announcing a policy direction that "heavily subsidised public health care in future is not for everything, and definitely not to support everyone!"

(South China Morning Post)