Keynote speech by SFH at 4th APEC High-Level Meeting on
Health and the Economy (English only)(with photos)
Following is the speech by the Secretary for Food and Health, Dr Ko
Wing-man, at the 4th Asia-Pacific Economic Cooperation High-Level Meeting on
Health and the Economy in Beijing today (August 15):
Minister Li Bin, honorable ministers, distinguished guests, colleagues,
ladies and gentlemen,
It is my great pleasure and honour to speak at APEC's 4th High-Level Meeting
on Health and the Economy. The theme of this year's high-level meeting is "A
New Vision for a Healthy Asia-Pacific in 2020". I am privileged to take this
opportunity to share with you Hong Kong's journey on healthcare reform in
the past few decades, and how we prepare ourselves for the challenges and
Hong Kong has long enjoyed the benefits of an effective dual-track
healthcare system, by which the public and private healthcare sectors
complement each other. Healthcare expenditure accounts for 5.1 per cent of
our GDP. The public sector, which is heavily subsidised by the Government,
is the predominant provider of secondary and tertiary healthcare services.
With 27,000 public hospital beds, the Hospital Authority accounts for 88 per
cent of the in-patient services in Hong Kong in terms of bed-days. The
private sector complements the public healthcare system in providing primary
care services and hospital services for those who can afford and are willing
to pay for healthcare services with personalised choices and better
amenities. Thanks to the professionalism and dedication of our healthcare
professionals, life expectancy in Hong Kong has been ranking among the top
in the world, which was 86.6 years for females and 80.9 years for males in
2013. The infant mortality rate remained at a low level of 1.6 per thousand
registered live births.
That said, similar to other advanced economies, we are now facing a number
of major challenges, most notably an ageing population and rising medical
costs. In 2013, the proportion of elderly in our population is about one in
seven. This will become one in three by 2041, with huge read-across
implications for our healthcare system.
Confronted by these challenges, the Government of the HKSAR has
substantially increased its investment in public healthcare over the years.
The annual government recurrent expenditure on healthcare reached $52
billion (or around US$6.67 billion) in 2014-15, accounting for 17 per cent
of the total recurrent expenditure of the Government. We treasure public
healthcare as the cornerstone of our healthcare system and safety net for
all. We have and will continue to strengthen and develop our public
healthcare system. For instance, we are taking forward a number of major
capital works projects to enhance the public healthcare infrastructure,
including the expansion and redevelopment of existing hospitals, as well as
the development of new hospitals including the first children's hospital in
Hong Kong which is currently under construction. As far as ongoing projects
are concerned, we shall spend around US$7.6 billion to provide 1,500
additional hospital beds. We have also formulated a blueprint for public
hospital development and re-development to further enhance our service
capacity to cater for the future demand for healthcare services.
Nevertheless, the rising health expenditure, which grows at a rate faster
than that of the economy, leads to the important question of how we can
ensure the sustainability of our healthcare system in the long run.
Healthcare reform is no news to Hong Kong. Discussions on healthcare reform
and healthcare financing began as early as in 1993, when the document
"Towards Better Health", more commonly known as the "Rainbow Document" was
published, exploring increasing user fees for public healthcare services.
This was followed by the so-called "Harvard Report" in 1999 recommending the
introduction of social health insurance. The "Lifelong Investment in Health"
consultation document published in 2000 explored the feasibility of
mandatory medical savings accounts. What these rounds of public consultation
revealed was that the community had significant reservations towards any
mandatory financing solutions, or any proposal that would change the
dual-track healthcare system in Hong Kong.
As a result, we proceeded to develop possible solutions along the direction
of voluntary participation, which culminated in a voluntary health insurance
proposal that we put forth for public consultation in 2010.
The Voluntary Health Insurance Scheme is meant to be a supplementary
financing arrangement that complements the public healthcare system. It is
not intended as a total solution to the problems of our healthcare system
but one of the turning knobs in readjusting the public-private balance.
Currently, about 2.8 million people, or about 40 per cent of our population,
are covered by some form of private health insurance, and among them about 2
million are covered by indemnity hospital insurance. However, for people
with private health insurance coverage, half of them still pertained to the
public sector in terms of hospital admissions. A question then arises – what
is keeping private health insurance from playing a stronger financing role?
We may be able to get an answer from previous public consultations. Many
consumers are concerned about a few perceived shortcomings of existing
private health insurance, including decline of coverage or exclusion of
pre-existing conditions, no guaranteed renewal of policies, inadequate
benefit coverage and limits.
With the aim of improving the accessibility and quality of health insurance,
our latest proposal is to implement the Voluntary Health Insurance Scheme
through a Minimum Requirement approach.
Under the Minimum Requirement approach, all individual indemnity hospital
insurance products will be subject to the Minimum Requirements to be
prescribed by the Government. The Minimum Requirements comprise key features
designed to address the shortcomings of the existing health insurance market
and enhance the quality of insurance protection to consumers. Some of the
key requirements include –
(a) guaranteed renewal of policies without re-underwriting the policyholder;
(b) coverage of pre-existing conditions, meaning that insurers are not
allowed to exclude pre-existing conditions of the policyholder from
(c) guaranteed acceptance of policyholders; and
(d) minimum benefit coverage and limits, meaning that the benefit coverage
must include hospitalisation, prescribed ambulatory procedures, prescribed
advanced diagnostic imaging tests, and non-surgical cancer treatments up to
a prescribed limit. The benefit limits must also meet the levels prescribed
by the Government.
The Minimum Requirements that I outline here are not novel. In overseas
countries with a significant private health insurance market, such as
Australia, Ireland, the Netherlands, Switzerland and the United States, the
governments have all prescribed a set of basic requirements for private
health insurance products that are similar to those proposed for the
Voluntary Health Insurance Scheme.
With enhanced accessibility, continuity and quality, private health
insurance can play a greater role in financing the increasing health
expenditure, thereby helping to alleviate the pressure on public healthcare,
and strengthen the long-term sustainability of our healthcare system. Upon
finalisation of the detailed proposals for the Voluntary Health Insurance
Scheme, we will launch a public consultation later this year to seek the
As I mentioned earlier, the Voluntary Health Insurance Scheme is only one of
the tools for readjusting the public-private balance of our healthcare
system. In conjunction with implementing the Scheme, we are taking forward a
number of complementary policy initiatives in parallel.
First, we are reviewing the regulation of private healthcare facilities,
including private hospitals, with the aim of strengthening clinical
governance and enhancing transparency of service fees and charges. In
particular, on enhancing transparency of private healthcare services, under
the strengthened regulatory regime, private hospitals will be required to
publish historical statistics on common procedures, and provide a written
quotation to patients before they receive treatments. We would also
encourage packaged charges for common procedures or tests, and prescribe
what a package should contain. To facilitate private hospital development,
the Government in March 2013 disposed of a government site through open
tender for the development of a new private hospital. The new hospital is
expected to commission in 2017. Apart from the successful disposal of the
site, we are also considering various proposals from different organisations
to develop or expand private hospitals.
We are also in the process of developing an eHealth Record sharing system,
which aims to provide timely and accurate information for patients moving
between public and private service providers, improving disease
surveillance, and bringing about efficiency gains by optimising the use of
healthcare resources in the public and private sectors.
Public-private partnership is another tool to help redress the imbalance
between public and private healthcare services, with the objective of
shortening the queues in the public sector and enabling it to focus on its
target areas, such as servicing the underprivileged or handling more
complicated cases requiring multi-disciplinary support. Public-private
partnership can take a variety of forms, such as the purchase of general
out-patient service from the private sector, or transferring ambulatory
surgeries to the private sector. We have had quite some success in, for
example, significantly reducing the queue for cataract surgery in recent
years since implementing the partnership programme.
Other measures or initiatives that we are taking forward include reviewing
healthcare manpower planning to ensure a sufficient supply of healthcare
professionals in the future; enhancing primary care to ensure the public can
receive appropriate medical care in a timely manner; promoting the
development of Chinese medicine and practices (including the development of
the first Chinese medicine hospital in Hong Kong); and strengthening our
surveillance and control of communicable and non-communicable diseases.
Ladies and gentlemen, the challenges presented by an ageing population are
common to many economies; yet there is no one-size-fits-all solution to
these challenges. Each jurisdiction must develop its own home-grown solution
– sometimes through trial and error – having regard to the characteristics
of its social, economic and healthcare system. With this in mind, I hope my
brief sharing on Hong Kong’s experience on healthcare reform can be of value
to you in taking on this challenging task. Last but not least, I thank you
for the opportunity to speak here today, and I look forward to some
interesting and enlightening exchanges with you.
Ends/Friday, August 15, 2014
Issued at HKT 15:58