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Element 5:
Incorporating cost-effective contracting, as indicated by
well-implemented payment systems

The payment systems incorporated into the Scheme will be critical for incentivising the
participation of different providers while allowing for accountability mechanisms to be
prioritised by purchasers. The economic analysis completed in Chapter 4.3 and serves as a
reference tool for better understanding the financial impact of the Scheme upon
implementation, the cost-drivers and required cost inputs to ensure that the Scheme is
cost-effective in the long-run, which should be a recurrent practice for any prospective
programme that seeks to apply strategic purchasing in Hong Kong.

1. To ensure equivalent standard and quality for chronic disease management in the
private and public sectors, we propose that the Government set up and
implement a management Scheme for HDH in the private sector that
is modelled off the Risk Assessment Management Programme
(RAMP) for newly diagnosed HDH patients currently implemented in the public sector
so that an HDH-positive patient can receive continuous and affordable care. We also
recommend that the Government and purchaser develop common clinical
protocols and share staff training and development programmes
between the public and private sectors.

a. As doing so requires managing alignment between public and private sector
service provision, we recommend that the Government and purchaser ensure that
the parallel RAMP protocol is specific to the services available in the private
sector. The Government and purchaser should define the standard protocols
required in the new RAMP schemes and ensure that there is alignment on
treatment options for patients on conditions co-morbid with HDH.

b. The private sector providers should be responsible for the care
and management of patients with HDH. Nonetheless, the Government
and purchaser are recommended to explicitly define the risk-sharing
mechanisms between the private and public sectors. For instance,
patients should be able to attend their RAMP programme in the private sector as
they need, but if their conditions worsen and they require acute hospital inpatient
services, patients should be referred to public hospitals. This sharing of risk
perceivably helps to incentivise private sector providers to partake in the Scheme
and simultaneously help manage the increasing healthcare demand on the
public sector.

2. The Government and purchasing authority should hold all contracted providers
to a determined quality standard to ensure that all patients receive similar care,
regardless of sector of service provision. The attainment of the care standard should be
a central determining factor of contract renewal and participation
eligibility in the scheme. Specifically, the Government may consider the
implementation of a provider performance-based payment model to ensure that service
provision is optimised for best outcomes of patients participating in the Scheme. The
performance-based payment may employ a set of quality standard criteria that
providers must meet and surpass.

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