Five health financing models have been proposed in the consultation document
“Towards Better Health” in 1993. They are:
Model of percentage subsidy approach
Model of target group approach
Model of coordinated voluntary insurance approach Model of compulsory comprehensive insurance approach
Model of prioritisation of treatment approach
It is a restatement of the Scott Report recommendation that hospital inpatients should be charged a low percentage of the average bed-day cost, instead of a notional food cost.
By these, three main types of hospital – acute general, convalescent/ infirmary, and psychiatric are subsidized at the same percentage.
It comprises two major elements – semi-private rooms and itemised charging – plus an option for waiver of charges.
It aims to provide patients with a greater choice, while achieving greater equity in financing. Semi-private rooms promise a superior standard of accommodation for better-off patients who opt to pay a higher daily fee while itemised charging is an income based proposal.
It involves the creation of a body to accredit medical insurance policies designed to cover treatment at public facilities. The idea is to increase consumer protection and transparency while involving relatively little government intervention in the industry.
It requires all households to participate in a centrally administered medical insurance scheme. Such scheme would cover primary and hospital care, up to a certain standard, in both the public and private sectors. Participants could also upgrade the level of coverage by purchasing supplementary insurance from medical insurance companies.
This model seeks to overcome the problem of overloaded public facilities by listing medical conditions and treatments in order of priority and funding them in accordance with available resources. Patients with low priority medical conditions would simply not be treated, freeing resources and reducing waiting time for more important cases.
3. “Lifelong Investment in Health” (Harvard’s Report) (1998)
After more than 5 years of debates on the above stated medical financing models, there was no consensus on implementing any of them. Therefore in 1998, another
4. “Your Health Your Life: Healthcare Reform Consultation Document” (2008 and 2010)
Cap the Government Budget for Health Care
User Fees
Health Security Plan and
Long-Term Care Savings Accounts
Capping the government budget for health has many of the features of existing financing system. The only measure involved is setting an explicit upper limit on government healthcare expenditures (or a limit on the rate of growth of those expenditures).
The aims of raising user fees for public facilities are twofold:
to manage the government budget, and to reduce the overuse of nearly free public health services. The fee has to increase steadily to assure that government expenditure remains at a constant percentage of Gross Domestic Product (GDP). This option shifts the burden of increasing healthcare costs from the government onto households.
This model consists of two separate components: mandatory contributions to individual savings accounts to be used to purchase long-term care insurance upon retirement or disability (MEDISAGE), and a Health Security Plan (HSP) for inpatient hospital and outpatient services for certain serious chronic diseases (The Harvard Team. 1998).
For further information on the proposal, refer to “Lifelong Investment in Health” from the following web site:
http://www.fhb.gov.hk/en/press_and_publications/consultation/
HCR1.HTM
consultation team - The Harvard Team - was appointed by the Government to examine the existing financing system and recommend changes. Besides maintaining the current financing system as one of the options, three other options were provided in the Harvard’s Report. They are:
In 2004, a paper on “Studies on HealthCare Financing and Feasibility of a Medical Savings Scheme in Hong Kong” was presented to the Legislative Council Panel on Health Services. Even though no consensus was made since then, discussion is going on. Until 2008, another healthcare reform consultation paper - “Your Health Your Life: Healthcare Reform Consultation Document” - is launched calling the discussion on the whole range of financing options. There are three models with six schemes in raising existing government funding to improve and sustain quality healthcare suggested in this consultation document. They are:
Tax-like Model
User-pays Model
Individual Health Insurance Model
Social Health Insurance
Out-of-Pocket Payments
Voluntary Health Insurance Medical Savings
Mandatory Health Insurance
Personal Healthcare Reserve
All members of the working population are required to contribute a certain percentage of their income to finance healthcare protection for the whole population. All the contributions are paid into a social health insurance fund to provide subsides to the whole population for the use of public and private healthcare services covered by the social health insurance.
It needs to increase the user fees for using public healthcare services.
With the exception of low-income and under-privileged groups, service users are required to share a larger portion of the costs for healthcare.
This option encourages members of the public to purchase private health insurance in the market voluntarily.
It requires a specified group of the population to deposit part of their income into a personal medical savings account to meet their own future healthcare expenses.
It requires a specified group in the population to purchase individual health insurance regulated by the Government.
It requires a specified group in the population to deposit part of their income into a personal healthcare reserve account. Part of the deposit will be used for subscribing to a government-regulated personal healthcare insurance, and the remainder will be accrued in the account to continue subscribing the insurance and meet other medical expenses after retirement.
For details about the healthcare reform, please refer to the following website: http:// www.beStrong.gov.hk
The models for health care in different countries can be classified as follows: