Health care financing in Hong Kong: a case for tax-based financing

With the new government of the Hong Kong Special Administrative Region currently conducting a review of Hong Kong's health care financing system, this article argues that the existing tax based system not only works well at present, but is also sustainable in the future. The performance of the system is analysed in terms of cost, health outcomes and access. The arguments for change are discussed, and the case for maintaining the status quo is presented. The author concludes that the way forward would be to fine tune the existing system rather than to replace it with other systems which are known to have higher transaction costs and more serious supply-side moral hazards.