Germany’s Health Care Policy
Executive Summary
Germany arguably has one of the best health care systems in the world. A combination of good hospitals and experienced medical practitioners provide quality health care for everyone. The health care sector is Germany’s largest employer with more than four million employees, and approximately 10 percent of the country’s GDP is spent on health care[1]. However, Germany is still undergoing a health care policy reform: a policy that is aimed at providing cost effective quality health care to the country[2]. This paper will examine the role of Germany’s health system, and analyse the background of the system in order to better understand current trends. It will also look at how this system is organised and financed.
Background
Germany developed two different health care systems as a result of the creation of the two states (East and West Germany) in the late 1940s. The pro-communist East Germany operated a public health care system which was controlled by the state, meaning that doctors and other health care practitioners were employed solely by the government.[3] In West Germany, the country continued to operate a private health care system which was regulated by the government. The formation of two German states in the late 1940s resulted in two different German health care systems. In East Germany, a centralized state-run system was put in place, and physicians became state employees, the government providing the role of a regulatory body.[4]
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Current Status:
Germany’s health care policy has evolved significantly over the last six decades. Today, public health insurance is compulsory for those who make up to €43,000 annually and their dependants. Those earning more than €43,000 annually are not compelled to enrol in the public health insurance scheme.[5] However, they are free to subscribe to public health insurance if they wish, or turn to the private sector. About 75% of those in this category opt for the government insurance policy, and this system insures about 88% of the German population.[6] Consequently, just 10 percent of the population is covered by private health insurance, a figure not dissimilar to that of other countries with good government healthcare provision such as the United Kingdom or France. The year 2009 has witnessed many changes to the German health system: health insurance is now compulsory for everyone in the country.[7]
The system is funded through compulsory contributions made by workers who earn up to €43,000 a year. Last year, the average insured German employee contributed about 8% of his or her gross wages and the employer contributed 7% to the funds. This implies that the average worker’s insurance contribution stands at 15% of the value of his or her gross salary. The publicly funded health insurance is run by about 200 autonomous non-profit and nongovernmental health insurance funds.[8] These institutions are regulated by law. In addition to this, private health insurance is funded through individual payment of a risk-related premium and is optional for all Germans, as in most other countries. Each dependant is covered by a separate premium assessed by the company.[9]
Recent Changes:
This year marks a turning point in the history of Germany’s health care policy. That is because the country has introduced the following health care sector reforms effective from January 2009 in the sector.[10]
i-The government shall set a uniform rate which sickness funds have to collect. All these contributions shall be assembled by the newly created national health fund. The fund will later allocate the resources collected to the various sickness funds based on the risks. These risks would take into consideration factors such as age, sex, and diseases. For example, some sickness funds would receive more for patients with deadly diseases such as cancer, HIV as opposed to those insured without this condition.
ii – Health insurance has been made compulsory in German law. This depends on earnings and the previous insurance policy those to be insured previously subscribed to. But the ultimate goal is to ensure that no-one is left out of the system.
iii – Sickness funds can charge extra premium if the total amount of funds received from the person to be insured is not sufficient.
iv – Private insurance companies are expected to participate in a risk adjustment programme so as to offer insurance for patients who are unable to afford high risk premiums.
Key Issues:
In 1992, the German health care system was touted by then President Bill Clinton as one of the best in the world, though comparing health systems internationally is notoriously complex and unsatisfactory, as arguably there are evident advantage and disadvantages to all health systems in the developed world, at least. Everyone in Germany is insured and no one gets a bill from the doctor.[11] In 2004, the system was re-organised such that patients could choose their own doctors, making it possible for some beneficiaries of public health insurance to enrol in the “family doctor” care scheme.[12] The national health insurance policy covers preventive services, hospital care, dental and mental health care and rehabilitation as well as compensation in the event of a sick leave.[13]
Hospitals are mostly non-profit institutions; however, over the years, the profit making sector has been growing. One in every six patients goes in for private treatment in hospitals that were mostly taken over from the state by private businesses. These hospitals employ doctors, nurses and other health care personnel whose salaries are negotiated in a free market just as in any other ‘business’. Having said this, it is important to remember that, despite private profit-making health care growing in Germany, no one is deprived of quality health care, irrespective of income. The government has put in place a national strategy aimed at ensuring that those insured received good quality health care. Critics of the public system have always cited inadequate quality, though they may have vested interest in private healthcare, of course, and the quality of safety of private healthcare is most definitely not guaranteed to be better than state provision. In response to this criticism, the Institute for Quality and Efficiency was created in 2004.[14]
Underlying Principles
To conclude, Germany has made it possible for everyone to have good quality health care, and that has always been the underlying principle when it comes to providing healthcare to the German population. Most Germans opt for public health insurance system which they consider more affordable and convenient. If left on their own, many Germans would not be able to afford the cost of good quality healthcare, so, as in other state systems, the wealthier subsidise the poorer. About 75% of the German work force earns below 43,000 Euros, so are realistically unable to afford good quality health care on their incomes. Germany’s healthcare system is widely acclaimed by some in the United States, which has a notorious private healthcare system plus under-resourced Medicare insurance, and where over 50 million apparently have no healthcare at all, and some Democrats seem convinced that this system would work for America to ensure that everyone is covered by the public system.[15] But, arguably, the real success of Germany’s health care policy rests on its emphasis on sound training of medical practitioners and well-equipped hospitals, not solely on how this is financed.
REFERENCE:
Busse, Reinhard (2008) The German Health Care System, Berlin University of Technology & Charité (http://www.commonwealthfund.org/~/media/Files/Resources/2008/Health%20Care%20System%20Profiles/Germany_Country_Profile_2008_2%20pdf.pdf)
Fisher, Marc (1992) Germany’s Health System: Model for America or Plan in Crisis? The Washington Post, December 28, pp. A2
McKee, Martin (2004) Health Policy and European Union Enlargement, Maidenhead (UK): Open University Press, pp. 76
Zimmer, Annette and Priller, Eckhard (2000) The Third Sector and Labour Market Policy in Germany, German Policy Studies, 1(2) pp. 209
Zimmer, Annette. (1999) “Corporatism Revisited – The Legacy of History and the German Nonprofit Sector.” Voluntas, 10(1): pp. 37-49.
[1] Zimmer, A. & Priller, E. (2000) “The Third Sector and Labour Market Policy in Germany,” German Policy Studies, 1(2) pp. 209
[2] Busse, R. (2008) The German Health Care System, Berlin University of Technology & Charity, pp. 1
[3] Zimmer, A. (1999) “Corporatism Revisited – The Legacy of History and the German Non-profit Sector.” Voluntas, 10(1) pp. 37
[4] Zimmer, A. (1999) “Corporatism Revisited – The Legacy of History and the German Non-profit Sector.” Voluntas, 10(1): pp.40
[5] Busse, R. (2008) The German Health Care System, Berlin University of Technology & Charité, pp. 2
[6] McKee, M. (2004) Health Policy and European Union Enlargement, Maidenhead (UK): Open University Press, pp. 76
[7] Busse, R. (2008) pp. 3
[8] Busse, R. (2008) The German Health Care System, Berlin University of Technology & Charité, pp. 2
[9] Ibid
[10] Ibid
[11] Fisher, M. (1992) “Germany’s Health System: Model for America or Plan in Crisis?” The Washington Post, December 28, pp. A2
[12] Busse, R. (2008) The German Health Care System, Berlin University of Technology & Charité, pp.2
[13] ibid
[14] McKee, M.(2004) Health Policy and European Union Enlargement, Maidenhead (UK): Open University Press, pp. 77
[15] Fisher, M.(1992) Germany’s Health System: Model for America or Plan in Crisis? The Washington Post, December 28, pp. A2