Strong state commitment boosts Hong Kong's healthcare sector

The government has allocated 15% of its 2021 budget to healthcare.

A strong government commitment to healthcare will largely be positive for the healthcare sector in Hong Kong, as the sector remained as one of the most significant spending priorities in the city, according to a report from Fitch Solutions.

Hong Kong’s government has allocated 15% of the 2021 budget, which is earmarked at $93.7b (HK$731.1b), Finance Secretary Paul Chan said in the Budget 2021/2022 speech. The sector saw the second largest allocation after social welfare.

The government aims to step up COVID-19 surveillance and testing efforts. The Department of Health will receive a total of $670m (HK$5.2b) over the next three years for various measures in handling the virus.

At the same time, another $3.4m (HK$27m) will help fund health IT systems to implement anti-epidemic measures. Further, the government pledged $1b (HK$8.4b) to buy and administer the vaccines. Hong Kong’s free mass vaccination programme started for the general public on 26 February, with the most vulnerable citizens prioritised.

In addition, a sum of $18m (HK$147m) has been pledged to support hospital and community psychiatric services to enhance juvenile and elderly mental health services run by the Hospital Authority (HA). About $15.9m (HK$124m) will also go towards the HA’s cancer services.

The budget documents also reported that the HA will press ahead with the implementation of the first 10-year Hospital Development Plan (HDP) and the planning of the second 10-year HDP.

“The HA will review the design of hospital projects under the two 10-year HDPs considering the experience in combating Covid-19 and incorporate required provisions for two to three general wards in each selected hospital, so that they can be readily converted into Tier-2 isolation wards when the need arises,” Fitch said.

The report noted that for the past several years, the government’s budget for medical health services has grown YoY. The country has established a dual medical economy in which the government has been involved in both the funding and provision of health services mainly through tax financing and personal insurance.

The government has also been promoting the development of private hospitals in recent years as part of its healthcare reform initiatives, Fitch said. In particular, it is supporting the expansion and redevelopment plans of existing private hospitals, as well as reserving pieces of land for new private hospital development.

“In recent years, leveraging on available capacity and capability in the private sector through public-private partnership has become a key strategy for managing demands for and enhancing patients’ access to clinical services, ultimately leading to an overall improvement in healthcare service quality through the combined efforts from both the public and private healthcare sectors in Hong Kong,” the report stated.