I told you so: the private sector has derailed Hong Kong government’s health insurance scheme

When Hong Kong’s health minister Dr Ko Wing-man announced that the proposed voluntary health insurance scheme might not be successfully launched during his term, because of roadblocks put up by the private insurance industry, what came to my mind was the schoolyard taunt – I told you so.

Many months ago, I suggested in these columns that if the government had to rely on the take-up rate of private insurance companies for it to succeed, the government would be held to ransom by them. And that’s exactly what happened.

The government made two fundamental errors in trying to implement the programme. First, it should not be called an insurance scheme; secondly, private insurance companies should never be allowed to play any role in it.

Actuary principles of the health insurance business require the majority of subscribers to be non-claimants for the business to be sustainable – hence the numerous exclusion clauses for pre-existing medical conditions.

The scheme doesn’t exclude pre-existing conditions. Many subscribers will be claimants. It is bound to lose money, and the government is ready to pump HK$4.3 billion into subsidising it. Thus it is not an insurance policy.

The insurance scheme’s purpose is to provide value-for-money medical coverage for the middle class, especially those with existing chronic diseases, so that they can use private health care. In this way, the scheme will relieve somewhat the heavy workload of our overstretched public hospitals, subsequently improving their services for those using them.