Current German Program
(France and the Netherlands have similar programs)
* Life-long medical care for all its citizens
* Pays for hospital, doctor and dental care, and a sickness
benefit after a 6 week waiting period.
* Mental health services program weak
* Serious shortage of nurses. Complaints about low pay and
low status
* Long-term nursing home care and home care being improved
* Paid prescription drugs. "Reference" prices established
for drugs, which are solely available from privately operated
pharmacies.
* Doctors paid by fee-for-service, fees negotiated annually
by program.
* 1147 statutory compulsory not-for-profit medical insurance
companies guarantee provision of comprehensive coverage
to all
insureds (90% of population). Plan over 100 years old (1845
and
law of 1911. Called "sickness funds".
This large number of sickness funds makes for unwieldy ad-
ministration.
* Also have 42 private health insurance plans which 10% of
the population has chosen based on over $36,000 annual
income and
occupational status. Plans reimburse physicians and hospitals
at
twice the negotiated rates.
* Large companies have created their own sickness funds
(self-insured)
* Paid for by a fixed %age of employees' gross income, plus
an employer contribution. Combined rate was 12.8 in '89
* Premiums of unemployed paid by Federal Labor Admin. in
2/3's of cases, or local welfare agencies in 1/3rd.
* Premiums of retired persons paid by their pension fund as
a flat %age of the pension, based on the national average of
working persons' payroll contribution.
Only covers 40% of care of pensioners. Retired persons
remain members of their sickness fund, which subsidizes the
dif-
ference.
* Federal government has responsibility for health service
professions, statutory health and accident insurance, doctor's
fees, hospitals, pharmacies and medicines, social security
and
welfare medical care, protection of patients, medical research.
* System operates within strict framework of federal and
state regulation
* Since '77 have enacted cost-containment laws and some
cost-sharing by patients
* 17 regional associations of ambulatory care physicians
monitor their patterns of service, negotiate annual fee-for-
service rates, provide to their members disability and
survivors
insurance, subsidies for underserved areas
* 90% of ambulatory care physicians prohibited from treating
patients in hospitals
* Most hospital-based physicians (salaried) prohibited from
treating ambulatory care patients
* Physician procedures given a "point value" on fee schedule
rather than monetary value
* Patient presents physician with a "treatment voucher", and
doctor notes thereon the services provided. Physician bills
own
regional association quarterly
* One clerk in the regional association office per 10
physicians reviews and pays claims. Administration cost = 2.5%
* 1 doctor per 357 persons (ratio nearly lowest in world)
* Average net income for doctors before taxes = $100,000 =
3 1/2 times earnings of blue collar workers
* 11 hospital beds per 1000 persons. Rates negotiated on a
flat per diem charge
* 26 medical schools (all public institutions) with 12,000
graduates a year, 40% women.
(U.S. has 126 medical schools and 16,000 graduates a year)
* Most students' costs paid by government. Admissions and
perforance testing prescribed by law
-------------------------
Uwe E. Reinhardt, economics professor at Princeton University
specializing in health issues reported to favor the German plan.
* Sickness funds cost 5% of gross domestic product in '89
Total health care cost was 8.2%
Sweden's rate was 8.8% of gross domestic product,
France's rate was 8.7%,
Canada's rate was 8.7%,
Japan's rate was 6.7%,
Britain's rate was 5.8%
--------------------------
'89 Health care disbursements breakdown:
Germany U.S.A.
Hospitalization 31.5% 38.4%
Physicians 17.5 18.9
Maternity 2.1 ---
Preventive 3.8 ---
Drugs 15.6 8.2
Loss of income 6.6 ---
Medical appliances 6.0 1.8
Dental care 9.8 5.1
Administration 5.8 5.0
Funeral 1.0 ---
Sources: New England Journal of Medicine, 2/14/91 and 6/13/91
Embassy of the Federal Republic of Germany
(France and the Netherlands have similar programs)
* Life-long medical care for all its citizens
* Pays for hospital, doctor and dental care, and a sickness
benefit after a 6 week waiting period.
* Mental health services program weak
* Serious shortage of nurses. Complaints about low pay and
low status
* Long-term nursing home care and home care being improved
* Paid prescription drugs. "Reference" prices established
for drugs, which are solely available from privately operated
pharmacies.
* Doctors paid by fee-for-service, fees negotiated annually
by program.
* 1147 statutory compulsory not-for-profit medical insurance
companies guarantee provision of comprehensive coverage
to all
insureds (90% of population). Plan over 100 years old (1845
and
law of 1911. Called "sickness funds".
This large number of sickness funds makes for unwieldy ad-
ministration.
* Also have 42 private health insurance plans which 10% of
the population has chosen based on over $36,000 annual
income and
occupational status. Plans reimburse physicians and hospitals
at
twice the negotiated rates.
* Large companies have created their own sickness funds
(self-insured)
* Paid for by a fixed %age of employees' gross income, plus
an employer contribution. Combined rate was 12.8 in '89
* Premiums of unemployed paid by Federal Labor Admin. in
2/3's of cases, or local welfare agencies in 1/3rd.
* Premiums of retired persons paid by their pension fund as
a flat %age of the pension, based on the national average of
working persons' payroll contribution.
Only covers 40% of care of pensioners. Retired persons
remain members of their sickness fund, which subsidizes the
dif-
ference.
* Federal government has responsibility for health service
professions, statutory health and accident insurance, doctor's
fees, hospitals, pharmacies and medicines, social security
and
welfare medical care, protection of patients, medical research.
* System operates within strict framework of federal and
state regulation
* Since '77 have enacted cost-containment laws and some
cost-sharing by patients
* 17 regional associations of ambulatory care physicians
monitor their patterns of service, negotiate annual fee-for-
service rates, provide to their members disability and
survivors
insurance, subsidies for underserved areas
* 90% of ambulatory care physicians prohibited from treating
patients in hospitals
* Most hospital-based physicians (salaried) prohibited from
treating ambulatory care patients
* Physician procedures given a "point value" on fee schedule
rather than monetary value
* Patient presents physician with a "treatment voucher", and
doctor notes thereon the services provided. Physician bills
own
regional association quarterly
* One clerk in the regional association office per 10
physicians reviews and pays claims. Administration cost = 2.5%
* 1 doctor per 357 persons (ratio nearly lowest in world)
* Average net income for doctors before taxes = $100,000 =
3 1/2 times earnings of blue collar workers
* 11 hospital beds per 1000 persons. Rates negotiated on a
flat per diem charge
* 26 medical schools (all public institutions) with 12,000
graduates a year, 40% women.
(U.S. has 126 medical schools and 16,000 graduates a year)
* Most students' costs paid by government. Admissions and
perforance testing prescribed by law
-------------------------
Uwe E. Reinhardt, economics professor at Princeton University
specializing in health issues reported to favor the German plan.
* Sickness funds cost 5% of gross domestic product in '89
Total health care cost was 8.2%
Sweden's rate was 8.8% of gross domestic product,
France's rate was 8.7%,
Canada's rate was 8.7%,
Japan's rate was 6.7%,
Britain's rate was 5.8%
--------------------------
'89 Health care disbursements breakdown:
Germany U.S.A.
Hospitalization 31.5% 38.4%
Physicians 17.5 18.9
Maternity 2.1 ---
Preventive 3.8 ---
Drugs 15.6 8.2
Loss of income 6.6 ---
Medical appliances 6.0 1.8
Dental care 9.8 5.1
Administration 5.8 5.0
Funeral 1.0 ---
Sources: New England Journal of Medicine, 2/14/91 and 6/13/91
Embassy of the Federal Republic of Germany
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