The Hong Kong government is planning a health care change for 2010-2011 time frame. In a budget speech given on 2-24-2010 the Financial Secretary informed all that the government plans to introduce voluntary medical insurance system. This means the government is working on plans to help Chinese living in Hong Kong move towards a private health care system to lessen the load on government programs currently in place. The government is considering providing tax deductions for premiums.
This voluntary system to expand coverage is going to be the baseline standard of coverage for insurers. Basic medical coverage package is being worked out and would exclude mental illness and congenital conditions. Premiums would be based on age rather than experience. Insurers are still rejecting the government’s push to include pre-existing conditions.
Hong Kong does not have a compulsory national health insurance program. Medical care is provided in both public and private facilities, though most emergency and hospitalization care is provided in public facilities and a majority of primary care physicians are in the private sector. Medical care is financed almost equally by both public (primarily general tax revenues) and private (out‐of‐pocket payments) resources. The cost of care varies based on whether the patient receives care in a public facility (where the government sets fees) or in a private hospital. The government‐set fees for public facilities are differentiated between those who are “eligible” (Hong Kong Identity Card holders under the Registration of Persons Ordinance) and those who are “non-eligible.” “Eligible” patients pay lower set fees.
Healthcare System Reform
Hong Kong is currently considering reform of the healthcare system.
In March 2008, the government launched a 3‐month healthcare reform consultation, inviting feedback from the public about how to financially supplement the healthcare system. The Food and Health Bureau presented 6 options for supplementing the system in a paper presented to the Legislative Council:
* Social Health Insurance: Employees contribute a certain percentage of their income to finance healthcare for the entire population.
* Compulsory Medical Savings Accounts (MSA): Certain portion of the population required to contribute to a medical savings account that would cover future medical expenses and/or purchase of approved medical insurance.
* Out-of-Pocket Payments: User fee increase for out of pocket payments at public health facilities.
* Voluntary Health Insurance: More people encouraged to buy private health insurance.
* Mandatory Health Insurance: Certain portion of the workforce required to subscribe to a regulated private health insurance scheme.
* Personal Healthcare Reserve: Certain portion of the population required to deposit part of their income to a personal account whose funds would serve as savings for future healthcare needs and be applicable to the purchase of mandatory insurance. A survey of employers found that the personal healthcare reserve (mandatory savings and insurance) was the most popular option and the social health insurance (employee contributions to finance public healthcare) was the least popular option.
It is fairly common practice for Hong Kong companies to provide private medical benefits to employees and their families. The plan may be insured or self‐insured. Many insured plans use a Preferred Provider approach, whereby benefits are paid in full if they are provided by a doctor who is on the “approved” list of the insurer. Frequently, an employer will offer two or three levels of benefits – one for executives, providing care in a private hospital room; another level for managers; and a third, lower level for other employees (providing care in a hospital ward). Insurers also offer dollar indemnity plans (paying a specified amount for each day in the hospital, regardless of actual expenses), maternity benefit riders, and dental coverage. Normal exclusions from coverage include nervous and mental disorders, AIDS and HIV‐related conditions in the first five years of membership, cosmetic surgery, maternity expenses (unless covered under a rider), and general physical examinations. Many employers pay the full cost of coverage for employees; they pay half of the cost for dependent coverage. Employer and employee-paid premiums are tax deductible. Benefits are paid free of tax.
The government will plan later this year, 2010, to allow a public consultation period once the health care reform plan is finalized. These reforms will not apply to insurance plans administered outside Hong Kong. This is good news for international health insurance plans that are based in the US. This is another good reason to look at international health insurance plans that Good Neighbor provides. You may view them at our corporate web site at www.gninsurance.com .
Doug Gulleson loves to scuba dive overseas and he makes sure he always takes his Amex card AND international travel insurance policy. Visit Good Neighbor Insurance at www.healthinsuranceinternational.biz/gmmi.asp for your next overseas trip and get a FREE quote.