Everything You Ever Wanted to Know about National Health Plans ….and maybe more - Germany


"German Health System Not Quite in Intensive Care " - Going by media reports and public opinion in Germany, one might think the country's health care system is sclerotic and near collapse. But international comparisons and health-care experts paint a different picture.

In a 2000 report conducted by the World Health Organization (WHO) on global health care, Germany ranked 25th out of 191 countries based on a cost-effectiveness ratio, coming in before the USA (37) and Canada (30). In another study, carried out by the Frank Beske Institute for Health System Research in 2005, Germany came in first among 14 industrial countries regarding health-care services available to the insured.

But ask Germans about their own system and they are usually quick to judge it wanting. One survey conducted by the Commonwealth Fund, an American health care foundation, found that 55 percent of Germans thought the system needed fundamental reform.

 More than 50 percent of Americans rate the US health-care system as "excellent" only 35 percent of Germans would give their own system such high marks.

Health-care reforms enacted over the past several years, which introduced a nominal co-pay for doctor's office visits and made some changes to drugs covered by public health plans, have unleashed widespread anger among the populace and only deepened public dissatisfaction.

Right now, the system is supported for by contributions from workers, who generally pay around 14 percent of their wages for health care. But Germany's stubbornly high unemployment rates have meant less money is going into the system.  Uninsured in Germany has risen above the 200,000 mark, with some suggesting that number could reach as high as 250,000.

  •  Germany will be applying higher co-payments and more services will not be covered by insurance plans in the future.

Most agree that Germany's creaking health care system needs reform. Cries have gotten louder that the system of public and private insurance providers has created two classes of health care.

Privately Insured and preferential treatment

When Peter Stegman calls to set up a doctor's appointment, he usually gets what he wants. The 37-year-old Berlin resident who works in the mobile phone industry is insured privately, and if he wants an appointment on the next day, he almost always gets it. "You just get treated better when you have private insurance than if you have the public kind," he said. "The service is better and you have more choice."  Before coming to Germany from Finland two years ago, he investigated the country's insurance system and was told that if he could afford it, private insurance was the best option, since people on the public plans get lower priority with many doctors. "They have problems getting appointments quickly; it takes a lot more time," he said.

Anecdotal evidence abounds about difference in service between those insured under private health care plans in Germany and those with the state system. The newspaper Bild conducted a test of 100 doctor's offices around Germany, calling each to set up appointments.  In each case, one caller would claim to have private insurance, another to be insured under the public system. In the majority of cases, the privately insured individual got appointments much sooner than did publicly insured pretend patients, if they got appointments at all.

"Private patients are preferred, publicly insured patients are brazenly turned away, just gotten rid of," Heinz Windisch, president of VKVD, an interest group for both privately and publicly insured individuals, told the newspaper.

People who earn less than 46,800 euros ($54,850) per year are obligated to enroll in one of Germany's public health plans. Their contributions are determined by their income and range from 12.7 to 15.5 percent, half of which their employer pays.

In addition, Public insurance patients must pay

  1. A 10 euro quarterly office fee
  2. Five to 10 euros for medicines,
  3. Pay for shared rooms in hospitals 
  4. Generally cover 50 percent of the cost of dental prostheses.

Private patients, on the other hand

  1. Generally have much more choice regarding doctors
  2. Have long lists of services covered
  3. Are not required to pay a quarterly office fee
  4. Can receive medicines or eyeglasses without additional charges

"Those who pay more in Germany get better service," said Kai A. Konrad, a professor specializing in health system economics at the Institute of Public Finance and Social Policy at Berlin's Free University. "They are like two different products."

German hospitals are coming under increasing pressure to cut costs, and are seeking concessions from their medical staff. Doctors working in hospitals are paid roughly the same salary as an elementary school teacher, despite having to endure work weeks that often amount to more than 60 hours.

Self-employed or non-employed persons:

Another measure of the health reform bill of 2007 is that all self-employed persons had to be insured after July 1, 2007 and can purchase private health insurance if they were previously privately or even uninsured. It is now illegal to be uninsured.

Striking German Doctors Shed Light on System Ills

Some 20,000 doctors at German state-run hospitals lay down their stethoscopes this week demanding better pay and work conditions. Can the country afford to pay its doctors more—and can it afford not to?

Indeed, a 2004 study by UK economic research group NERA showed German hospital physicians at the rock bottom of a list of 11 western countries in terms of compensation, earning between 35,000 and 65,000 euros ($41,000 to $77,000) per year. A similar OECD study showed German physicians earning 15 percent less than their counterparts in the UK, and 40 percent less than US doctors. The problem with physicians' pay is not recent. "It has been a political problem for the past 20 years, but it's been ignored," Henke said.

You may opt for private health insurance (Private Krankenversicherung or PKV) instead of joining the government health plan if you can show that your gross annual salary is presently more than 48,150 Euros and has been more than 47,700 Euros per year for each of the past three years.

For those seeking to upgrade their medical coverage to Private
  1. Right to consult a private doctor
  2. Homeopathic remedies
  3. ,A private room in hospital
  4. Higher dental reimbursements
  5. A wide choice of medical and dental treatment
  6. Provide broad geographical coverage.
  7. Private patients generate higher earnings for medical professionals and will usually be treated by senior doctors.
  8. A private patient can also request and will often get, doctors who speak their native language.

Supplemental insurance coverage is available which can top up the government system benefits.

Health Insurance Options in Germany - 2008

Germany has a reputation for having one of the best health care systems in the world, providing its residents with comprehensive health insurance coverage. Approximately 85% of the population are mandatory or voluntary members of the public health scheme while the others usually have private health insurance.

The health insurance reform of 2007 now requires everyone living in Germany to be insured for at least hospital and out-patient medical treatment. The costs of the German health care system are immense and rising due to demographics as well as long-term unemployment rates.

Recent government reforms have attempted to make hospitals more competitive and thereby reduce costs for the state health insurance providers (Gesetzliche Krankenversicherung or GKV).
1. Reduced benefits for dental work.
2. Increased out-of-pocket payments.
3. Additional 0.9% insurance premium above and beyond regular income tax.

Efforts to cut the social security cost for employers and reduce the monthly cost for state health insurance members were controversial and after a very long and drawn out political battle, a further health reform compromise was reached which went into effect in 2007.
The cost of government health insurance is currently approx. 15 % (the rates depend on the provider "Krankenkasse" you choose) of your eligible gross salary to a maximum monthly income of 3,600 Euros. If you earn more than this you do not pay a higher insurance premium. Assuming you pay a monthly premium of 530 Euros as an employee earning at or above the threshold and are therefore a voluntary member, your contribution is approx. 280 Euros and your employer pays approx. 250 Euros.

The public benefits include

In-patient (hospital) care as a

  • Ward patient
  • With doctor on duty
  • Nearest hospital

Out-patient care with registered doctors (Kassenärzte) and basic dental care.

Generally no coverage for

  • private doctors or surgeons,
  • a private room in hospital,
  • alternative/homeopathic medical care,
  • dental implants,
  • vision products for adults or benefits outside of Europe.

Your non-working dependents living at your address in Germany are presently insured at no additional cost and are simply to be registered with the "Krankenkasse".

From Deutsche Welle.................

Reforming Germany's health care system is considered crucial by most politicians on both the left and the right. But what that reform should look like is a matter of much debate.

"Many doctor's offices in Germany are dependent on these higher private fees," said Roland Stahl, a spokesman for the National Association of Statutory Health Insurance Physicians. "If they disappear, then about one-third of the medical practices in Germany would go under."

Angela Merkel's conservative Christian Democrats (CDU) have called for a single, flat rate -- or "premium" -- for all members of the country's public plans, which are now calculated according to income level.

Bakery example


Health expert Konrad tries to illustrate the complicated issue of the two plans with a metaphor of an imaginary bakery. If this bakery were run by the Social Democrats, who advocate wealth redistribution, the cost of rolls would depend on the income level of the buyer. Low-income people would pay 20 cents per roll, those with higher incomes would pay 40 cents.


"The problem people have with this system is that people with lower incomes buy too many rolls and people with higher incomes buy too few," he said, explaining that the rolls in this illustration represent medical services. After a while, he says, the economic sustainability of the bakery (medical plan) comes into question.


Under the CDU's "premium" plan, all the rolls (medical services) would cost the same, no matter what the buyer's income is. Advocates here say that would encourage people to only buy however many rolls they actually needed to sate their hunger -- not too many, not too few. They also say such a plan would encourage competition between the plans and could drive down costs.


But this plan, which would do away with the redistribution aspect all together, is not completely feasible at this point, Konrad says.


Even before this year's German Medical Association congress got underway, more than 5,000 doctors demonstrated in several German cities to protest pay cuts of up to 17 percent and longer working hours. And on Tuesday, the opening day of the congress, desperate doctors took their protest to the streets of German capital. Among them was Ravindra Gujullah, an Indian-born general practitioner in the town of Landsberg.


"When you become a doctor, you have such zeal to be a good doctor and to serve people," Gujullah said. "But these things are not so important today. Now, you have to fight just to survive."


Medical brain drain


German hospitals are coming under increasing pressure to cut costs, and are seeking concessions from their medical staff. Doctors working in hospitals are paid roughly the same salary as an elementary school teacher, despite having to endure work weeks that often amount to more than 60 hours.


The president of the German Medical Association, Jörg Dietrich Hoppe, has predicted that more and more well-trained doctors will seek better-paid jobs in the pharmaceutical industry, or even leave Germany for better opportunities abroad.


"Our young doctors don't see any prospects for advancement and better pay in German clinics," Hoppe said. "Headhunters, especially from Britain, are currently looking for German doctors -- specialists in particular -- and offering them wages that are three times as high, plus working hours that don't go beyond 50 hours a week."


Patients bearing the brunt


"Patients fall by the wayside in a health machinery subject to cost-cutting and maximizing efficiency," Isenburg said. "More than 15,000 people die in Germany every year due to medical mistakes and faulty treatment, which is why it's important for German doctors to find ways at this congress to avoid such mistakes and reduce the cost pressure. A good health service cannot be had for nothing."


In a speech on Tuesday to open the annual congress, Health Minister Ulla Schmidt vowed that affordable treatment for all would remain the German government's ultimate goal. But in view of an ageing population on the one hand and the rapid advancement of medical science on the other, more efficiency was inevitable, Schmidt said.


In government speak more efficiency means cost cutting.  Cost cutting is always done through cost containment, utilization reviews or completely cutting services.

Tomorrows report will be Japan.

  1. Health Care in Germany -- a Matter of Class?
  2. Striking German Doctors Shed Light on System Ills
  3. German Health Service Sick, Doctors Say
  4. German Health System Not Quite in Intensive Care
  5. In Germany, insurance isn't just a good thing to have -- it's mandatory
  6. Health Insurance Options in Germany - 2009