Study Reveals Information Asymmetry and Price Uncertainty in Private Healthcare Services Consumer Council Advocates 5 Recommendations to Enhance Price Transparency and Foster Consumer Trust and Value

Over the past decade, the demand for healthcare services in Hong Kong has surged due to population ageing and a rising life expectancy. As a result, the city’s current health expenditure has increased by 73.1% from HKD130,75 million in 2013/14 to HKD226,31 million in 2022/23, of which approximately 52.0% was publicly-funded, and 48.0% was settled by the private sector either by household out-of-pocket payments or private medical insurance. This dual-track healthcare system, with the private sector employing approximately half of the city’s doctors and providing 68% of out-patient services but only about 10% of in-patient services, reflects an imbalance between the public and private sectors.

To address this imbalance and ease the pressure on public healthcare, the Government has encouraged greater adoption of private healthcare services, such as through the Voluntary Health Insurance Scheme. When choosing private healthcare, apart from safety and service quality, consumers need price transparency and a clear understanding of medical costs to make informed decisions and to avoid financial burden from unexpected bills.

However, the unique and personalised nature of healthcare services makes it difficult to obtain precise price information, as costs depend on factors like individual medical conditions, treatment methods and specific medical equipment required, etc. Information asymmetry also arises from the fact that doctors possess much greater medical knowledge, while patients often rely on their advice. This imbalance of power, however, might hinder consumers’ interests in comparing prices and making informed choices.

With an aim to empower consumers with clear price information when selecting doctors and private healthcare facilities (“PHFs”) and to foster greater consumer trust in private healthcare sector, the Consumer Council conducted a comprehensive study titled “Price Transparency in Healthcare: Fostering Consumer Trust and Value” (“the Study”) to examine the concerns and pain points experienced by consumers in using private healthcare services, identify areas for improvement and put forward 5 recommendations for enhancing the price transparency in the private healthcare sector. These recommendations are intended for consideration and discussion by the Government, stakeholders and the public.

Price Transparency Regulatory Regime in Hong Kong

In 2018, the HKSAR Government gazetted the Private Healthcare Facilities Ordinance (Cap. 633) (“PHFO”), marking significant progress by introducing a premise-based regulatory regime to further protect patient safety and rights.

PHFs, namely private hospitals (“PHs”), day procedure centres (“DPCs”), clinics, and health services establishments in Hong Kong are regulated under the PHFO. As of February 2025, licensing for PHs and DPCs has commenced. Licensed PHs and DPCs must implement price transparency measures as stipulated in the PHFO and relevant Code of Practices (“CoPs”), including (i) providing price information for chargeable items and services (applicable to all PHs and DPCs); (ii) providing budget estimates to patients (applicable to all PHs); and (iii) publicising historical bill sizes statistics (“HBS”) (applicable to all PHs). Concurrently, the Government and The Hong Kong Private Hospitals Association (“HKPHA”) have launched the Pilot Programme for Enhancing Price Transparency for Private Hospitals (“Pilot Programme”), which all PHs in Hong Kong participate on a voluntary basis. The Pilot Programme provides further implementation details for the price transparency measures, including the display of fee schedules, provision of budget estimates, and publicising of HBS.

Despite the price transparency measures under the PHFO, the implementation of these measures across PHs/DPCs remained inconsistent, and the market lacked a standardised method for disclosing price information or providing budget estimates. According to the Council’s statistics from 2021 to 2024, a total of 191 complaint cases concerning private healthcare services provided by PHs and DPCs were recorded, with the total disputed amount exceeding HKD7.2 million. Among these complaints, price/charge disputes (45.5%) accounted for the highest proportion.

Improvements are obviously needed, in both the implementation of these measures and efforts to raise consumer awareness, empowering them to safeguard their own interests. Furthermore, strengthening communication between PHFs, doctors and patients is crucial to prevent potential price disputes. To address these challenges, the Council reviewed the regulatory frameworks governing the private healthcare sector in 4 selected markets: Australia (Victoria), Mainland China, Singapore, and the United States (Florida). Each market has its own price transparency initiatives to safeguard consumer interests, providing valuable references for Hong Kong.

Issues Identified Through the 4 Stages of the Patient Journey

The Study adopted a mixed-method approach^[1] in examining the 4 stages of the patient journey, including searching for price information, exploring medical packages, obtaining budget estimates, and resolving price disputes. Among the PHs and DPCs subject to the new licensing regime under the PHFO, the Study encompassed 13 PHs providing the 30 common and non-emergency treatments/procedures (“30 treatments/procedures”) recommended by the Department of Health (“DH”), and 128 DPCs providing anaesthetic/endoscopic/surgical procedures, which are more relevant to the 30 treatments/procedures.

Stage 1: Searching for Price Information

The Council’s Study revealed various issues faced by consumers in the initial stage of acquiring healthcare services. According to the consumer survey, less than half (43.0%) of the respondents reviewed available price information before and/or after consulting the attending doctor. Among this pool, over half (52.6%) relied on PHF websites, underscoring the importance of making price information accessible online. However, the DPCs were found to be incomprehensive in price disclosure, with 15 out of the 20 sampled DPCs failing to provide online price lists for the selected treatments while 1 did not even have a website. By contrast, all 13 PHs showed their price information online as recommended by the Pilot Programme, though the presentation of fee schedules by service items chargeable may be difficult for lay consumers to understand, reflecting the need for more user-friendly formats.

Meanwhile, significant price differences were also found across PHs for the same treatment. For instance, the 50^th percentile price for in-patient haemorrhoidectomy ranged from HKD33,881 to HKD85,387 among different PHs, representing a 152.0% price difference.  While factors such as variations in patient’s medical condition, service quality and the choice of doctors/healthcare facilities/ treatment methods could contribute to these differences, the findings highlight the importance for patients to compare prices across PHFs.  

HBS, being one of the 3 price transparency measures stipulated in the PHFO, are valuable references for estimating and comparing costs at a PH or across PHs. However, only 10.1% of the consumer respondents (PH users) had reviewed HBS, with some finding it difficult to comprehend. Among those who had not reviewed HBS, more than two-thirds were unaware of its existence. The Council’s review further revealed a much-delayed provision of HBS data on the websites of 4 PHs by at least a year and a half. DPCs, not required under the PHFO or the CoP of DPC to publicise HBS, showed no proactive disclosure of similar historical price data during the Council’s desktop research on sampled DPCs.

Doctor’s fees, including those for anaesthetists and other specialists, were not included in the fee schedule or price list, and the basis for setting these fees was not disclosed. Doctor’s fees and hospital charges were often linked to room type, yet the rationale for this correlation was unclear and perceived as unfair by some consumers. They opined that they should not be charged differently for the identical treatment simply based on their accommodation choices. Overall, based on the Council’s trader survey, no clear pattern was observed regarding whether PHFs or individual doctors should be responsible for providing and explaining price information to consumers, and such ambiguity in accountability may lead to price disputes at subsequent stages.

Stage 2: Exploring Medical Packages

A medical package typically involves a fixed fee covering necessary or key services for a patient’s episode of care, such as doctor’s fees, hospital charges, and medications. Despite consumers’ favourable perception of packages as providing price certainty and facilitating price comparisons, packaged charging remains uncommon in Hong Kong. Except for the more common colonoscopy, gastroscopy and caesarean section, for which packages were available in 10 PHs, packages were limited for most of the other 30 treatments/procedures. The number of packages offered by PHs are quite varied, with 1 providing packages for 26 treatments, while another offered only 2.

Even when packages were available at some PHFs, the information provided was sometimes unclear and insufficient, such as missing details on the treatment methods, making it difficult for consumers to compare prices with other PHFs’ packages or non-packaged services. Additionally, the prices of excluded items were frequently undisclosed, likely due to the difficulty of standardising such costs. Commonly excluded items include medication, consultation fees and doctor’s fees could still be significant, creating challenges for consumers attempting fair and like-for-like comparisons between medical packages.

Stage 3: Obtaining Budget Estimates

At this stage, the Study identified pain points such as limited provision of detailed and written budget estimates, and inadequate disclosure of specialists’ and anaesthetists’ identities. The format and information included in budget estimates varied widely among PHFs, as the PHFO or CoPs do not explicitly outline its way of provision. According to the consumer survey, 39.0% of the respondents reported receiving only verbal budget estimates, despite the cited common practice for doctors to provide a more detailed written budget estimate at later stages after an initial verbal budget estimate in range. Notably, verbal budget estimates were more common in DPCs (59.0%) than in PHs (31.7%). From a consumer protection perspective, verbal estimates are less desirable for consumers as they do not provide a written record for reference.

Among the budget estimates in the consumer survey, 86.8% included a total sum of all chargeable items, while 60.6% also included a subtotal for doctor’s fees, but significantly fewer PHFs provided further breakdowns for doctor’s fees (20.8%) and PH/DPC/miscellaneous charges (18.8%). Some consumers only received lump sum estimates in range formats, without a detailed breakdown of treatment costs and individual chargeable items, making it harder to reconcile the final bill.

Moreover, only 1 out of the 13 reviewed PHs included a space in the budget estimate form to fill in the identity of specialists other than the attending doctor. Given the critical nature of these specialists and anaesthetists’ roles, the Council deems it necessary to inform patients of their identities beforehand so that consumers could verify their credentials and licence status before undergoing treatment to ensure better consumer protection. The current level of disclosure is considered inadequate.

Stage 4: Resolving Price Disputes

Price disputes accounted for 45.5% of the complaints received by the Council between 2021 and 2024 regarding private healthcare services provided by PHs and DPCs, with discrepancies between budget estimates and final bills being one of the key source of complaints of such nature.  As of February 2025, the overall resolution rate was only 35.6% despite the Council’s conciliation efforts, reflecting the challenge in resolving such disputes.

Among the dominant 67.2% of consumer respondents who encountered price variations, 64.9% did not receive any explanations, falling short of consumers’ general expectation for such price discrepancies to be explained by doctors or nurses. Primary causes of price discrepancies with explanations provided included the patient’s actual medical condition differing from the initial assessment (46.5%), additional services requested by the patient (15.2%), and the attending doctors changed the treatment plan (11.1%). Some of these factors, according to the PHs in the trader survey, could be beyond the PH's control.

However, most consumers chose not to file complaints. Reasons for not doing so included unfamiliarity with the complaint channels available, perceptions that lodging a complaint would be time-consuming, and a desire to maintain a good relationship with their doctor.

With an overarching aim to empower consumers, reduce information asymmetry, and ultimately foster a more transparent and trustworthy healthcare environment, the Council puts forward 5 recommendations for consideration by the Government, stakeholders and the public, to be adopted progressively as short-, medium-, and long-term measures:

Recommendation 1 – Improve Consumers’ Accessibility to Price Information with a Search Tool

The unique and customised nature of healthcare services creates a complex landscape for providing precise price information, making price uncertainty a significant obstacle for consumers. This uncertainty could result in price discrepancies, unexpectedly high bills, and disputes. Notably, 10.6% of the consumer respondents received a final bill exceeding their budget estimate by 20% or more, leading to potential financial difficulties.

The Council recommends enhancing consumers’ access to price information in phases. Firstly, to facilitate price searching at PHs and DPCs, it is imperative to ensure that DPCs proactively publicise price information online, which is currently not required. In tandem, the Council suggests the Government to develop guidelines for PHs and DPCs on presenting price lists in user-friendly formats, such as organising them by specialty (e.g. colonoscopy-related charges) rather than solely by charge categories (e.g. ward accommodation and operating theatre charges), to enable more effective search and comparison. PHs and DPCs should also include additional common chargeable items in their price lists for consumers to better understand potential medical expenses.

Secondly, to enhance the usability of HBS, the Government can consider providing guidelines for PHs covering at least 3 key areas: (1) Timeliness: Update HBS more frequently, potentially every 6 months or so; (2) Detailedness: Enhance disclosure to include exact discharge figures and detailed cost breakdowns (e.g. anaesthetist’s fees and other specialist’s fees); (3) Readability: Use layman terms (e.g. “typical” fee level instead of using “percentile”) to improve comprehension. These guidelines could serve as the industry benchmark for other PHFs to follow in the
long run.

As a medium-term measure, the Council recommends the requirement for publishing HBS to include more treatments/procedures beyond the existing 30 treatments/procedures in PHs, while DPCs should also compile historical bill sizes of the 30 treatments/procedures they provide.

In the long term, through upgrading the existing HBS database and online portal on the Pilot Programme website, the Council recommends the Government to compile a centralised historical price indexes database for PH/DPC charges and doctor’s fees to enhance accessibility and user experience, while in parallel developing appropriate search tools to provide relevant typical fees for a range of treatments, which could enable the public to better compare medical costs and make informed choices of healthcare facilities. The centralised database and search tool could be developed with reference to pricing information disclosure systems of other markets, including Australia (Victoria), Singapore and the United States (Florida), and rolled out in 2 phases:

• Phase 1: Establish a database of historical fees and charges at all PHs for the 30 treatments/procedures, i.e. consolidation of DH’s existing database;
• Phase 2: Expand the database to cover historical fees and charges at all DPCs for the 30 treatments/procedures, and cover more treatments/procedures beyond the current list in PHs.

Recommendation 2 – Promote the Use of Packaged Charges

The Study found that consumers opting for medical packages experienced fewer price discrepancies, with 42.2% of the consumer respondents who paid packaged charges reporting no price discrepancies, significantly higher than the 25.2% found in general. Recognising that medical packages provide greater price certainty, facilitate price comparisons and offer clearer cost estimates, potentially reducing medical expenses over time, the Council encourages PHs and DPCs to proactively design and introduce medical packages for suitable treatments as a tool to align budget estimates more closely with final bills. Offering a broader range of medical packages would also give consumers greater flexibility in selecting options tailored to their needs.

The Council also recommends the Government to issue guidelines for designing and marketing medical packages, covering the key items to be included and disclosed in the marketing materials, together with certain flexibility allowed on the scope of the packages. In the long-run, PHs and DPCs can introduce more packages tailored to various levels of medical conditions, thereby enhancing fee transparency and addressing diverse healthcare needs. Given the varying complexities of individual cases, PHs and DPCs can develop a matrix list of packaged charges categorised by the complexity of the treatment and the patient’s medical condition level.

Additionally, a common coding mechanism for the treatments can be introduced in stages. This would improve communication between doctors, patients and insurers regarding treatment decisions, and facilitate price comparisons across PHs/DPCs.

Recommendation 3 – Require the Provision of a Clear and Written Budget Estimate

In view of the varying disclosure extent of budget estimates among PHs and DPCs, the Council recommends that the Government explicitly requires PHs and DPCs, prior to undergoing treatments, to provide patients with written budget estimates that include a clear breakdown of key items. Initially, this requirement could be applied to all 30 treatments/procedures at PHs and DPCs, as well as for other non-30 treatments/procedures at PHs.

The Council reckons that the Government should strengthen the scope of the information to be specified in the budget estimate form when formulating the prescribed items for budget estimate, by including the following additional information:

1. Disclosure of the identity of anaesthetists and other specialists (other than the attending doctor): Allowing consumers to track credentials of relevant professionals also involved in the treatment, before admission and signing the budget estimate form;
2. Provision of the valid period: To prevent disputes arising from PHs and DPCs adjusting their price information after issuing the estimates, as it is noted that PHs/DPCs often disclaim on their websites that their price lists (if any) are subject to change without prior notice; and

3. Timeframe in issuing revised budget estimates to patients: To ensure consumers are kept informed of the updated charges of services provided, the Government should issue further guidelines/practice notes to PHs/DPCs to promulgate the revision timeframe (e.g. before admission).  

Recommendation 4 – Enhance the Current Regulatory Framework on Price Provision, and Complaint Handling Mechanism on Price Matters

The Council’s review of market practices identified various structural issues necessitating an enhancement in the current regulatory framework. Based on these findings, the Council sets forth the following recommendations to address critical areas for improving consumer experience in private healthcare.

1. Setting out accountability for information provision and explanation

Since not all consumers possess the necessary medical knowledge to understand price lists and budget estimates, healthcare professionals and relevant PH/DPC staff should proactively provide explanations. To clarify accountability for price information provision and explanation, PHs and DPCs are recommended to elucidate relevant internal policies to staff and publish at different channels, where appropriate, the relevant arrangements to consumers covering:

1. 1. Designation of personnel for providing and explaining price information to patients, such as price lists, budget estimates, HBS or past bill data, etc.;
   2. Proactive explanation of the budget estimate to patients by designated personnel, as well as providing advice on potential additional charges and the relevant circumstances in advance; and
   3. The accountability of the PHs/DPCs/doctors in different scenarios, particularly in cases where visiting doctors transfer patients from DPCs to PHs.
2. Enhancing the service quality of consumer-facing staff

In view of the difficulties consumers may encounter in obtaining applicable price information and seeking assistance from PH/DPC staff, as well as the common occurrence of unexplained price discrepancies that may frustrate consumers and potentially lead to disputes, the Council recommends PHs and DPCs to develop, regularly review and execute internal guidelines on the following:

1. Conduct periodic communication training for frontline staff on providing useful, clear and accurate information to consumers;
2. Provide price and treatment information (e.g. medical packages) via multi-media and channels (e.g. videos, chatbots) to reduce staff workload; and
3. Assign specific staff members to alert patients to potential price discrepancies before treatments; and explain any discrepancies between budget estimates and final bills.

3. Improving complaint handling mechanism related to price disputes

To gain deeper insights into key reasons consumers lodge price-related complaints and the challenges they face, the Council recommends the Government to periodically and systematically engage with PH/DPC users to gather feedback through consumer surveys, in-depth interviews and other means.

Consumer feedback should be consolidated and communicated regularly to PHs and DPCs to facilitate continuous improvement. PHs and DPCs are encouraged to develop, regularly review and implement comprehensive internal guidelines on:

1. Procedures to handle different types of price disputes;
2. Standards for response times and resolution processes for price disputes; and
3. Designation of personnel for complaint handling on price disputes.

4. Enhancing the regulatory framework

Consumers rely on the Government’s safeguards to ensure PHFs’ compliance with the PHFO requirements through the licensing regime. The Council notes that each PHF licence application is handled based on the criteria deliberated and endorsed by the Advisory Committee for Regulatory Standards for Private Healthcare Facilities under the PHFO to assess the fitness and properness of the applicants/Chief Medical Executives (“CMEs”). This covers the handling in relation to cases where the applicants/CMEs had committed criminal offences and/or offences under the PHFO. It is worth noting that, as the PHFO is premise-based, any change of the PHF’s premise will require application of a new licence which involves vetting afresh. 

DH has taken measures to ensure accountability within the private healthcare sector for past offenders with the relevant criteria and records of regulatory actions having been made public, while regulatory actions on PHs/DPCs are considered when there is a breach of licence conditions or CoPs. However, relevant provisions on price transparency in the PHFO are still not in force.

The Government could consider adopting a comprehensive approach when considering regulatory actions including a thorough assessment of non-compliance with the price transparency measures, as well as continuing to safeguard the interests of consumers through the licensing regime. Integration of these considerations into the regulatory framework can foster a more price-transparent private healthcare sector.

Recommendation 5 – Strengthen Consumer Education Through Multi-channels and Collaborative Efforts

The Council’s consumer survey revealed a lack of consumer awareness of the 3 price transparency measures. While respondents were most aware of the requirement for PHs to provide budget estimates (31.8%), followed by the disclosure of price information (26.2%), only 7% know about PHs publicising HBS, highlighting the need to promote the general public’s knowledge of these measures.

With this in mind, the Council recommends a 3-pronged approach to raise awareness: (1) strategically placing related promotional materials in highly visible areas at PHs and DPCs, such as at cashiers and waiting areas; (2) leveraging a diverse array of media channels to reach a broader audience; and (3) adopting search engine marketing strategies by the Government to enhance online visibility of price transparency measures in place when consumers search for PHFs.

To improve the current imbalance of information asymmetry and to encourage consumers making informed decisions, the Council puts forward 5 questions for consumers to ask their healthcare service providers before treatments:

1. Do I really need to conduct the treatment?
2. What are the risks or side effects of the treatment?
3. Are there any simpler or safer alternatives for the treatment?
4. What happens if I don’t conduct the treatment?
5. What are the financial/emotional/time costs of the treatment?

It is equally essential to enhance the accessibility of complaint channels and mechanisms, and provide consumers with comprehensive information regarding the complaint process, including: (1) clearly outlining the documents required for reporting complaints to streamline submissions and reduce barriers; and (2) detailing the complaint handling procedures to enhance the credibility of the complaint handling mechanism and foster consumer confidence.

Last but not least, it is crucial to educate consumers on their right to information, particularly concerning the regulations and guidelines on information provision by PHs and DPCs.

Collective Efforts to Enhance Transparency and Value of Private Healthcare for Consumer Empowerment

The private healthcare sector in Hong Kong now stands at a critical juncture for enhancing price transparency. In the Chief Executive’s 2024 Policy Address, the Government outlines its determination to further reform the healthcare system. Key directions include enhancing the quality and efficiency of healthcare services, and exploring legislation for price transparency, with plans to consult relevant sectors in 2025.  

Through this Study, the Council hopes to raise public awareness of issues pertaining to the price transparency in Hong Kong’s private healthcare sector, and calls for collaborative effort among the Government, industry professionals, stakeholders, and consumers to adopt the recommendations progressively, with a view to narrowing the existing gaps in consumer protection, empowering consumers by reducing information asymmetry, and ultimately leading to a more transparent, trustworthy and accountable healthcare environment.