York Chow congratulates So Wah-wai, world champion and sprint record holder at the Paralympic Games (left). Chow, who likes to play a tense game of squash because he can forget all about his work while playing, has a game with world champion Jahanggir Khan.

Dr York Chow, Secretary for Food and Health, sheds light upon the anticipated healthcare financing plan, talks about pandemic diseases and reveals how he joined the government, following a last-ditch call from then Chief Executive Tung Chee-hwa.

Following public consultation in 2008, the government has decided to launch a healthcare financing plan in form of voluntary medical insurance with the savings element. The government intends to consult the public in the second half of 2010.

Officials have discussed with the insurance industry about the plan, including the scope of coverage and regulations. If no insurance company is interested, the government will consider forming its own company to run the medical insurance plan.

In an exclusive interview with China Daily, Dr York Chow outlines the ground principles of the healthcare financing plan.

He emphasizes that the scheme should provide adequate protection to all citizens, including young and old people, and those with serious or chronic diseases. All citizens should be able to afford the proposed insurance, so that even those with low income can still pay for it after retirement.

The plan must be sustainable and financially viable.

The insurance companies should not charge excessive insurance premiums; while hospitals and doctors should only charge reasonable fees from the patients.

"We hope to include standard insurance products, together with the premium rates, scope of coverage, the proportion of savings, government incentives and how the HK$50 billion start-up fund will be used," he disclosed.

"We have discussed with the insurance sector and there is no big gap between us. They understand the government's position.

"There are about 1.8 million people in Hong Kong who have purchased medical insurance, paying around HK$8 billion in aggregate premiums. If the government launches the healthcare financing scheme, it creates an opportunity for insurance companies to earn an additional HK$20 billion in annual premiums," he added.

Chow knows that people over 60 have difficulty obtaining medical insurance. Even when an insurance company is willing to cover them, the premium is very high.

Chow notes that, among the working people, there are not many who purchase medical insurance, as most employers will obtain medical insurance for their employees.

"If more people come together to form a bigger pool, we can obtain lower premium rates and cap the profit level," he explained.

The government hopes to see many young people from the middle and working classes joining the healthcare plan.

He is not too concerned about the coming years, but the next 20 - 30 years when the aging population problem deteriorates.

He explained: "We are planning for retirement protection of people who are now around 40 years old, because we anticipate by then, a quarter of our population will be elderly, thus imposing a heavy financial burden on taxpayers."

It is thus necessary to launch a voluntary medical insurance scheme alongside a robust public healthcare system, with the private healthcare system playing an auxiliary role, he stressed.

The government will continue to support the public healthcare system.

Chief Executive Donald Tsang has pledged to increase public healthcare expenditure to 17 percent of the total expenditure from 2007 to 2012, and the present level is 16.1 percent.

"However, public healthcare services in Hong Kong are more than saturated," he warned. "Even if the government inputs more financial resources, the public healthcare system will still deteriorate without the private healthcare system as a back-up.

"The citizens are very eager to have a new medical insurance scheme, but they don't want a mandatory scheme because they want to have more choices," he noted.

Chow has seen mandatory medical insurance schemes run effectively in Holland and Switzerland, while Australia operated a voluntary medical insurance system.

"People say Hong Kong is like Australia, which operates a dominating public healthcare system with private medical insurance as a back-up," he smiled and said.

If insurance companies are willing and interested, the government will be happy to let them run the scheme, but they are subject to the government policy and applicable legislation.

"If they are neither willing nor interested, or if think it is too risky, the government does not rule out the possibility of forming an insurance company to provide medical insurance, but this is only a secondary consideration," Chow declared.

China Daily

(HK Edition 03/19/2010 page4)