Part III of the Hong Kong Healthcare Series: Show me the Prices! Increasing visibility in hospital fees could relieve pressure on public health services

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While long lines for simple services pushes people out of government clinics, opacity in the pricier in-patient services tends to push those without high-end insurance to the public system.

The Hong Kong government thinks that greater visibility on pricing could make people more comfortable with private hospital services and is taking the initiative to tackle this issue. A bill that could be passed later this year could lead to significant changes in the provision of health care.

Making pricing transparent

“We rolled out (in October 2016) a pilot programme to enhance price transparency for private hospitals,” says Ms Kimmy Man, an officer at the Food and Health Bureau. “The pilot programme covers three price transparency measures, namely the provision of budget estimates, publication of fee schedules and publication of historical bill size statistics.”

Hong Kong’s private hospitals agreed to start providing bill estimates for 24 common surgical procedures while the Bureau has launched a website for the public to have easy access to historical bill sizes for specific treatments and procedures provided by participating hospitals.

However, the budget estimates and bill size statistics serve only as a reference and not the final prices patients will be paying.

“It is very difficult to quote prices because there is no way to know what care the patients need, such as how long they will have to stay in the hospital or what medication is needed. The only way is to estimate the cost by taking reference from the medial history of previous patients,” says Dr Ho Chung-ping, president of the Hong Kong Medical Association.

More could be done

Healthcare insurer Bupa says that while the pilot programme will generate useful information for the sector to generate more standardised and comparable pricing data, more is needed.

“There remain inconsistencies in how this pricing data is published to the consumer and patient. There is also high price variation for inpatient and outpatient procedures,” Bupa says.

“More guidance is needed from the regulator to private providers, such as what data to publish, in what format and to what depth. This would help create more comparability and standardisation.”

The insurer also suggests hospital providers should package pricing for procedures together to give more confidence in the overall cost of a treatment.

“We have seen the Gleneagles hospital in Aberdeen adopt this methodology in line with the government’s land grant requirements and hope to see it growing in the sector more generally,” Bupa explains.

Diagnosis-related groups, as Bupa points out in a report, could emerge as a step towards better, fairer payment systems. Using this approach, the regulator could set predetermined prices for different types of inpatient treatments. Cases within the same group are expected to undergo similar clinical evolution and incur the costs of diagnostics and treatment within a predefined scale.

Countries such as Australia, Singapore and the U.S. have adopted this approach.

In Australia, Private Health Insurance provides insurance against the cost of access to private hospital care and ancillary services to complement the publicly-funded universal health care system for access to hospital and medical care.

Quality is as important as price

But Bupa also stresses that price transparency alone is not enough to create a more sustainable patient-centred system.

“In isolation, a high price can be naturally presumed to equal high quality. Therefore, other indicators such as clinical outcomes and patient experience must be published together with prices to provide a more complete picture to the patient and consumer,” the insurer says.

In the U.S., the Consumer Assessment of Healthcare Provider and Systems surveys are in place to ask patients to evaluate their experiences. There is also a website known as Hospital Compare to allow consumers to assess the quality of hospitals.

A similar system in the UK allows patients access to star ratings of all National Health Service primary and secondary care medical centres and hospitals.

Meanwhile in Singapore, the patient satisfaction survey is conducted annually and overseen by the Ministry of Health to assess the level of patients’ satisfaction with public health providers and selected private providers.

Bupa urges the Hong Kong government to follow suit, developing a national quality framework. The authorities should also task regulation of public and private healthcare facilities to the same regulatory bodies, as now they are overseen by different departments.

Better balance between public and private

Besides addressing price and quality transparency, the government is also looking at other indicators to balance the burden of the public and private sectors and to regulate the private healthcare providers.

“The Voluntary Health Insurance Scheme will give a standard benchmark of minimum standards for individual health insurance policies. The Private Healthcare Facilities Bill will also bring a set of minimum standards into larger private healthcare providers such as hospitals and medical groups, although a large volume of smaller providers will be exempt from these regulations,” says Bupa, adding that the government has made good progress on developing policies in this regard.

Under the Voluntary Health Insurance Scheme, the participating insurance companies will offer hospital insurance plans that are certified by the Food and Health Bureau. The scheme aims to provide the public with an additional choice of using private healthcare services through hospital insurance, in order to relieve the pressure on the public healthcare system in the long run.

The Private Healthcare Facilities Bill brings together 19 regulatory aspects, covering corporate governance, standard of facilities, clinical quality, price transparency and sanctions as essential regulatory requirements for private hospitals.

“Subject to the passage of the Bill by the Legislative Council later this year, we would work out the details of the price transparency measures based on the experience gained during the pilot programme,” says Ms Man from the the Food and Health Bureau.

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