Hong Kong Health Care System - the Way Forward

Hong Kong Health Care System – The Way Forward

The Chinese University of Hong Kong

MKT 6061

Seminar on Current Business and Management Issues

Hong Kong Health Care System – The Way Forward

EMBA 2006

Group 3

Winnie Au

Adam Cheung

Lorain Lam

Vincent Leung

Lewis Ng

Vesper Wong

May 6, 2006

Executive Summary 3

1. Background 5

2. Research Purpose 6

3. Methodology 7

4. Findings 9

4.1 Hong Kong Future Health Care Services Delivery Model 10

4.2 Improvements to the System of Quality Assurance 16

4.3 Options for financing Health Care Services 17

4.4 Public view from the Survey findings 21

5. Recommendations 21

5.1 Suggested modified health care model 22

5.2 Key features of the suggested modified health care model 23

Appendices

Appendix I – Notes of meeting with Mr. Anthony Wu, Chairman of Hospital Authority

Appendix II – Survey Questionnaires (Chinese and English version)

Appendix III – Proportion of health care expenditure of selected economies

Appendix IV – Survey Findings

References

Executive Summary

It has been a long discussion and debate in re-creating a health care system for Hong Kong, which promotes health, provides lifelong holistic care, enhances quality of life and enables human development and finally add value to the community.

The existing strength of Hong Kong health care system in offering accessible, affordable, equitable and quality services to each patient has to be maintained. Yet cost-effective and financial sustainability are being challenged by scholars (Harvard team in 1999) and public.

There are three main strategic directions to change the system:

1. reforms to the health care delivery system by strengthening preventive care, promoting self-responsible health care, reorganizing primary medical care, promoting family medicine concept, improving public and private sector interface, others including facilitating dental care and promoting traditional Chinese medicine; (see section 4.1)

2. Improvements to the system of quality Assurance by providing continuing medical education and training to the health care professionals, setting up appraisal and promotion hierarchy to encourage the development of their ability throughout their career path, setting an independent surveillance and regulatory body to monitor the services level and quality of health care services and to develop the long term policy and strategies.

3. Sustainable financing options for health care services by Government’s continuous commitment on the public health are expenditure, a competitive integrated health care system, suggested mandatory Health Security Plan with the concept of “pooling of risks” to cover the long term health problem or unexpected large medical spending, co-payment of a nominal fee by the users to reduce the resources abuse. With the better allocation of resources, Government can put its resources to subsidise those areas of greatest need, such as the elderly, poor and low income group.

An extract of our suggested modified health care model (from figure 2 in section 5.1)

Reform the health care services delivery model (see figure 1)

Service provider

compete with

price and quality service

Independent

Surveillance

body

· Free choice of services

· Co-payment of a nominal fee (deductible)

· Balance paid by mandatory HSP

· Top-up cost for premium services

User

Premium contribution[1] Claim payment for health care services[2]

Independent

Mandatory

HSP fund

Public health Supervision and regulation

expenditure on funding

budget

Government

1. Background

The health care system in Hong Kong has been well developed during the past two decades for providing high quality medical services to citizens at a very affordable price. Yet, Hong Kong is now facing the following concerns and challenges which cast shadow to the long-term sustainability of the system:

· Compartmentalization in the delivery of Health Care services;

· Over-reliance on the public health care system that is heavily subsidized by the Government and over-stretched hospital services;

· Questionable financial and organizational sustainability;

· Question of quality and the adequacy of the public health surveillance system;

· Ageing population, usually associated with chronic illnesses;

· Increasing expenditure for new technology and new health problem;

· Aspiration of population expectation on quality services;

All above challenges will come with extra financial burden on the Government public spending. In 2004-05, the expenditure on public health care services totaled HK$30.2[1] billion and represented 14.4%[1] of the recurrent public expenditure. By the year 2016, the public health care expenditure may raise up to 23%[2] of the total public expenditure, a significant increase that causes the concerns about its financial sustainability.

Although in 1999, Hong Kong Government had commissioned Harvard University to conduct a consultation study on the existing health care system, and certain recommended changes were put forth for consideration, yet no action is taken to move forward.

On 4 March 2005, Health and Medical Development Advisory Committee (HMDAC) was reconstituted. It was tasked to review and develop the service model for health care in both the public and private sector; and to propose long-term health care financing options.

HMDAC issued a discussion paper “Building a Healthy Tomorrow” in July 2005 for public consultation. It sets its views on the future model of Hong Kong health care system with a view to building a sustainable system that is accessible and affordable by its people.

Recently in early 2006, HMDAC is working on possible financing options for the future Hong Kong health care system.

2. Research Purpose

This paper aims to analyse through conducting our own research and to provide suggestions on the development and implementation of a suitable and sustainable Health Care System for Hong Kong.

The methodology of our research study are outlined and described in Section 3, which include literature research, an in-depth interview with Mr. Anthony Wu, Chairman of Hospital Authority, Hong Kong and a public questionnaires survey.

3. Methodology

3.1. Literature Research

A literature review has been conducted on a lot of publications around the HK Health Care system including publications from Government consultation papers, Harvard consultancy report and reports from Census and Statistics Department.

3.2. In-depth Interview

In addition, an in-depth interview was conducted with Mr. Anthony Wu, Chairman of Hospital Authority, to get his insights on the Health Care System Reform and his strategies to address the ageing population and their related health care burden. (Details please refer to Appendix 1 for the meeting notes)

3.3. Survey

3.3.1 Survey method

Direct survey methods such as by telephone, via e-mail interaction or by face-to-face methods were selected as the most appropriate because of the guidance we could provide to the respondent while completing the questionnaire.

3.3.2 Sampling Frame

The sampling frame was all Hong Kong residents who normally live in a household. In addition to personal connection, samples were also randomly selected from telephone directory and e-mail directory.

3.3.3 Sample size for the survey

In order to achieve statistically significance, a total number of 150 questionnaire requests were sent out. Completed questionnaires were returned from 84 respondents. The response rate is about 56%.

3.3.4 Data collection instrument

The questionnaire was designed using categorizations that would make the data comparable with other relevant studies. Other than questions for sampling purposes, the questionnaire had covered three main areas, namely:

i. the medical spending behaviour of a household for past 12 months;

ii. the services level of health care sectors;

iii. financing options for future health care system.

All communication was conducted in Cantonese; the Chinese and English version questionnaires are included as Appendix II. In case of ambiguity, please refer to the Chinese questionnaire for the exact wording.

3.3.5 Sample characteristics

The sample was fairly representative of the Hong Kong household population. The average number of members in a household is 4. Males made up 50% and females 50% of the respondents, closely approximating the actual population 50/50 split.

4. Findings

The development of Hong Kong health care system is proceeding with the following guiding principles[3]:

· Maintaining existing strengths of accessible and equitable services, affordable prices and good quality;

· Government will continue to bear the major part of the public health care cost, but with some targeted subsidies to areas of greatest need;

· Sufficient safeguards to ensure that no one is denied adequate care due to insufficient means;

· The existing dual public and private systems, serving complementary roles, should be maintained, but with better collaboration between them;

· Pursuit for better health is a shared responsibility among the individual, the community and the Government;

· Development should be in collaboration with the community and changes must be progressive;

· Public resources should be used efficiently.

These principles fed into the three main strategic directions for the system reform.

i) Hong Kong future health care services delivery model;

ii) Improvements to the system of quality assurance;

iii) Options for financing health care services.

4.1 Hong Kong Future Health Care Services Delivery Model

4.1.1. Figure 1 summaries key components of Future Health Care Service Delivery Model

There are 8 components in the proposed future health care model. They are :

4.1.2. General Public

General Public have to be knowledgeable about health and health risk factors. They will adopt a healthy lifestyle and take responsibility or their own health

4.1.3. Health Care Professional

Today medical practitioners focus on curing diseases. In the future model, they have to put higher priorities in promoting health and preventive medicine.

4.1.4. Primary Health Care

Hong Kong’s primary health care services includes a range of promotional, preventive and curative services provided in health care institutions and in the community, are provided by the Department of Health (DH), the Hospital Authority (HA) and the private sector.

Most of the promotional and preventive services are provided by the public sector. For curative services, in terms of market share, private practitioners of Western medicine account for more than half of consultations (56.5%[4]). Private practitioners operate independently of the government and without subsidy. Most private practitioners are in solo practice. They usually work on a fee-for-service basis. Patients are free to choose any private practitioner, which may lead to phenomenon of "doctor-shopping" and affect the continuity of care. The practice of Family medicine is hitherto not common.

The directions for primary health care development, are as follows -

· Strengthen preventive care;

· Re-organize primary health care

o Promotion of Family Medicine (FM);

o Transfer of the operation of general out-patient clinics (GOPCs) from DH to HA to facilitate integration of the primary and secondary levels of care in public sector;

o Much more collaboration between public and private sector health care sectors, particularly for training and development of family doctors.

· Develop a community-focused, patient-centred and knowledge-based integrated health care services.

Primary health care is the first of point of contact individual and families have. It provides continuing, comprehensive and whole-person medical care. Its primary function is to improve health of the population and reduce the incidence of disease.

Moving forward, the establishment of a platform that allows exchange of medical information and observations will be necessary. It may also be necessary for HA to purchase part of its primary care service from private sector.

To date, some 560 trainees in FM have pursued their training in HA. The trainees have to undergo six years' training. The bulk of the first four years' basic training takes place within HA while the remaining two years' higher training takes place in the community. To enrich the training programme, HA has developed additional six-month non-FM community-based training modules for FM trainees since 2003. The content of these modules include geriatrics, hospice, woman's health and mental health.

4.1.5. Secondary Health Care

Secondary medical care covers Hospital Services that comprises of Accident & Emergency (A&E), Specialist out-patient and in-patient service (SOPD). Changes are recommended as follows:

4.1.5.1. To fairly allocate the demand and supply of the A&E services among public hospital:

· Careful planning of future hospital bed provision in individual district by taking into consideration of population size, elderly numbers, changes in demographics, utilization rate and patterns of different age groups and gender, income distribution, technology advancement and availability of private hospital beds;

· Review the critical mass of demand for optimal provision of A&E service for all districts;

· Designate several hospitals as specialized emergency center and specialty services center;

· Coordinate with private hospital in maximizing the resources;

4.1.5.2. To prevent inappropriate use of hospital services, particularly A&E services:

· Family doctors to play gate-keeper role;

· 24 hours private clinic;

· Establish links and protocols for referring emergency cases to A&E department;

· Private hospitals to develop A&E services;

· SOPDs of public hospitals to discharge medically stable patients;

· Establish referral protocols and shared-care programmes;

· Review fees and charges, minimizing the unnecessary attraction to abuse public hospital services;

4.1.5.3. To eliminate the imbalance of services demand between public and private hospital services sectors:

· Public sector should change the current fees and charges policy to reduce subsidy levels for patients;

· Public sector should coordinate with private hospitals in utilizing the resources and providing services; operating more shared-care programmes;

· Private sector should develop services more affordable to patients;

· Private sector should improve the transparency of their fees and charges, and enhance their clinical governance

4.1.6. Tertiary Health Care

Public hospitals have been the main provider for tertiary and specialized services at highly subsidized rate. It requires highly complex and specialized care through application of advanced technology and multi-disciplinary expertise. With ageing population, advancement of medical technology and rising public expectation, the cost of tertiary care is expected to increase exponentially over time.

4.1.6.1 To alleviate the pressure of demand on public hospital of such tertiary services, measures are recommended as follows:

· More aggressive prevention strategy in primary health care stage;

· Patient to build his own sense of responsibility for their own health;

· Larger co-payment;

· Other sources of funding;

· Maintaining a high standard, encouraging local research and collaboration among public, private and universities;

· Concentration of experience – consolidating tertiary services in designated centers