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This chapter delves into the unique contexts of Hong Kong and presents a situation analysis
of our local health financing structure, challenges, and ongoing transitions in past decades.
We will juxtapose our health financing development with overall health system goals through
discussing whether former efforts have been effective in leading Hong Kong towards the
achievement of a primary care-led system.

3.1 THE DEVELOPMENT OF HEALTH
FINANCING POLICIES IN HONG KONG

As discussed in Chapter 1, health financing is a crucial building block of health systems and
the key lever to facilitate progression towards achieving universal health coverage (UHC).
Health accounts are generally able to systematically reflect priorities of care and the evolution
of population healthcare needs through analysis of these health financing statistics, which
can uncover both opportunities and risks in building a primary care-led integrated health
system. In doing so, it is important not just to assess whether a system is sufficiently funded,
but to also understand where the money is spent and whether the investment aligns with
health system goals by examining its health financing practices.

3.1.1 AN OVERVIEW OF HONG KONG’S HEALTH
FINANCING SYSTEM

Hong Kong has a hybrid public-private mixed health financing system, in which a tax-based
public sector runs in parallel to a private sector by private financing from out-of-pocket
payments, to employer provided benefits and private health insurance. Analogous to the
overview of economic and health spending indicators we presented for jurisdictions with
different financing schemes in Chapter 2, Hong Kong’s economic and health spending
indicators are presented in Table 3.1. The health expenditure in Hong Kong as a percentage
of GDP is much lower compared to the health systems of many developed economies.
Considering the many health system achievements, like having the longest life expectancy,
Hong Kong has been ranked among the world’s most efficient health systems. Given the
ageing population accompanied by a shrinkage of the labour population, the Government’s
capacity to significantly increase health expenditures in response to intensifying healthcare
demands has been brought into question and the sustainability of the health financing
system has long been of concern.

Table 3.1
Key health expenditure indicators for Hong Kong (2019–2020)

Population GNI per Tax revenue Current CHE out of CHE per Government Share of
(million) capita at (% GDP) Health GDP (%) capita health OOP in
current Expenditure (HKD) expenditure CHE
market (CHE) (% govt. (%)
prices (HKD in exp.)
(HKD) million)
398,044
(2019)
7.5 10.77 181,190 6.5 24,135 14.4 29.6
379,181
(2020)

Note: GNI per capita is according to the data released on 14 September, 2021, which may be subject to regular revision.
Sources: C&SD, 2021c; FHB, 2021a; HKSARG, 2021d

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