The following system can best serve Hong Kong's healthcare objectives:

For maximum risk-pooling, healthcare insurance would be mandatory for everyone.  Premiums payable would be reduced by subsidies that range from almost 100% for the poorest members of the community, to almost zero for the richest, matching the extents by which individual income groups currently benefit from the Hospital Authority’s services.  That is, no income group would be financially worse off. upon switching to the new system  

However, once total public health expenditure starts to exceed a certain percentage of total public expenditure, patients would have to pay increased amounts of co-payments each time they make use of medical service.

Private doctors and hospitals would form themselves into networks.  Like the Hospital Authority network, these would provide comprehensive care; hence patients do not have to file insurance claims.  Networks, however, charge / offer different levels of premium / benefits.  Subsidy follows the patient to the network of his choice.  To ensure a level playing field among providers, the Hospital Authority would charge a level of premium that includes imputed costs of land and capital.  Free competition ensures that consumers get the best value for money.

People would be encouraged to pay a higher level of premium such that anyone who has paid the higher premium through age 65 need not pay premiums thereafter.  Incentives would be offered, using the $50bn set aside in the 2008/09 budget.     .                        ]

Click here for the full paper "Healthcare: consensus on objectives shows way forward"..

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