The Government of the Hong Kong Special Administrative Region (the Hong Kong Government) is considering subsidising a separate insurance pool to cover Hong Kong residents at high risk of medical complications (defined as those with medical costs expected to be more than 200% of those of healthy individuals) or those with pre-existing medical conditions (high-risk individuals) who sign up to a proposed voluntary medical scheme (the Scheme) that will be generally open to all Hong Kong residents.
It is proposed that under the Scheme, insurance companies would provide their policyholders with a basic health insurance plan featuring guaranteed renewal for life and coverage of certain packaged services at private hospitals. In addition to the basic plan, insurers would be able to market "top-up" plans to clients offering better coverage. All patients would pay only a portion of their medical bills under an arrangement known as "co-payments".
A major obstacle to the Scheme is that high-risk individuals would have to be provided with adequate coverage, which insurers say would be too expensive. However, should the Hong Kong Government set up a separate "high-risk pool", supported by a government subsidy as proposed, to finance the care of those high-risk individuals, then insurers would be less likely to object to the setting up of the Scheme.
Insurers would place all their high-risk policyholders into the high-risk pool. To ensure that this pool has sufficient funds to pay any claims made, insurers would contribute a percentage of the premiums paid by all Scheme participants for reinsurance protection and the Hong Kong Government would make up any shortfall in funds should there be a deficit.
The Hong Kong Government has assured interested stakeholders that the separate high-risk pool would be appropriately regulated and transparent. However, of continuing concern is how much healthy participants in the Scheme would subsidise those participants deemed to be high-risk.