After long-overdue public consultation, the government has finally decided to go ahead with its voluntary medical insurance scheme as a solution to the ills straining the public healthcare system.

Drawing on HK$50 billion for a span of 25 years as incentives in the form of discounts and subsidies for the city's people to sign up for private health insurance, the proposed Health Protection Scheme (HPS) is expected to shift the mounting overload in our public healthcare system to the private sector in 2015 when it has its official kick-off .

What do we have on the menu? It is basically insurance coverage for a general ward level of accommodation covering in-patient, ambulatory care and treatment of chronic illnesses, day surgeries and procedures with guaranteed renewal for life. The proposed incentives will include a 30 percent discount for young and early subscribers and premium subsidies for the elderly and high-risk patients provided by a high-risk pool backed up by the HK$50 billion fund. But high-risk patients will need to pay higher premiums not exceeding three times the amount a healthy person pays. A new statutory body, the HPS Authority, will be set up to implement the scheme, design the insurance plan's coverage and premium as well as enhance market transparency.

Everybody knows how the public system is overstretched with patients waiting restlessly in long queues that have no end in sight while healthcare staff grumble on a daily basis about the overwhelming stress at work caused by acute brain drain. A series of medical blunders or mishaps over the past few years explains the lamentable side effects of the public healthcare's ailment.

Nor does anyone forget about a powerful time bomb to be activated by the city's aging population, which is expected to grow to 28 percent by 2039 from the present 12.8 percent. It is foreseeable that the sky-high medical bill which is now costing the government nearly HK$40 billion a year, or 17 percent of its recurrent expenditure, will bite deeply into our finances and sustainability. The government therefore badly needs to come up with a reform of medical financing to defuse the time-bomb and relieve the burgeoning pressure on the city's cradle-to-grave public medical system.

Will what is laid out at the table be sufficient to lure people from public healthcare to the private market? Citing a government survey of more than 5,000 respondents with 60 percent supporting the scheme, the government is upbeat that the new scheme will attract up to 500,000 people to sign up for private healthcare. But the government should bear in mind that about 90 percent of respondents have expressed hopes for the government to strengthen its regulation of the private medical insurance sector as well as healthcare services. Patients' groups also expressed fears the scheme will encourage insurance firms and private hospitals to mark up premiums and medical fees as they please at the expense of the public purse.

Another concern is that as the private healthcare sector expands it will trigger a manpower shortage in public hospitals, leading to what is termed as "second class" service at public hospitals. How to maintain high standards of care at the public system is important to developing Hong Kong as the medical hub in Asia. In addition, the scheme may run the risk of defeating its purpose of helping the needy and underprivileged as high-risk or chronic patients may not be able to afford the high premiums.

A recent survey by the Society for Community Organization showed about 70 percent of chronic patients would not support the scheme as they will only be able to claim full compensation in the fourth year after they enrol for the scheme. They are not even certain about their presence. How do they know if there are four years ahead of them?

The scheme's success hinges on strong public support. The government needs to address the above problems and offer wider choices for patients to avoid the HK$50 billion fund from becoming subsidies for profit-oriented private hospitals and insurers. It needs to improve our public health system with the poor and needy taken care of. And those who can afford to pay more should be required to do just that.

The author is a current affairs commentator.

(HK Edition 07/14/2011 page3)