Germany’s Dual Health System

Contributed by Welcome Center Malta, 13 October, 2020

There have been new calls for reform on Germany's dual health system. A recent study found that many people would benefit from abolishing private health insurance and statutory health insurance retained. The information shared here is mainly derived from a survey by the Iges Institute, commissioned by the Bertelsmann Foundation.

Statutory Health Insurance

Those with statutory health insurance - along with their employer - had the potential to save an average of EUR 145 per year if the current dual system was abolished. According to a new study, the statutory health insurance scheme, Gesetzliche Krankenversicherung (GKV), would purportedly receive an extra EUR 9 billion a year if privately insured people were included in it. The cash boost would allow the GKV to reduce contributions for both employers and employees. In 2016, the statutory system had about 70.4 million insured people. There are currently around 73.2 million people insured under GKV, mainly due to a surge in immigration to Germany, stated Stefan Etgeton - Bertelsmann Foundation. While statutory health insurance members have an average annual income of EUR 24,149 per person, the figure for private health insurance members is EUR 37,858.

Private Health Insurance

In 2016, around 8.8 million people were privately insured. These statistics still stand. The findings are founded on the newest statistics from 2016 from an annual survey of approximately 12,000 households. According to the study, which fuels the discussion on introducing a so-called 'citizens' insurance,' those insured in private health insurance (PKV) earn an average of 56% more than those insured by statutory health insurance. Those in private health insurance (PKV) are mainly high-income earners, entrepreneurs, and civil servants. Those who opt for personal indemnification lean towards being healthier. Suppose they opted for statutory health insurance, the study calculates this would result in an annual cash boost of EUR 8.7 to EUR 10.6 billion to GKV. The contribution rate could then fall by 0.6 to 0.7 percentage points for those in the system. Please find more helpful information here for private health insurance.

Effects of Getting Rid of Private Health Insurance

If doctors were compensated for the loss of fees they would incur if there were no patients with private health insurance, the study believes contribution rates would still fall - by 0.2 to 0.3 percentage points. In this case, GKV insured patients and their employers would be relieved by an average of EUR 48 per year. The doctors' supply would also likely shift if privately insured people switched to the GKV system.

Doctors Take Advantage of Those Privately Insured

The Iges Institute investigated a connection amid the local dispersal of privately insured patients and the formation of doctors' surgeries. They found in Bavaria, for example, in areas with a large number of privately insured people, there's an above-average number of doctor practices. A causal connection was not proven in the study. However, the authors assume that "the average 2.5 times higher remuneration for homeopathic facilities for secluded patients" strengthens the incentives for doctors to set up their practices in areas with a large number of privately insured patients.

The Waning of Communal Unity

As a consequence of the twofold system, the Bertelsmann Foundation cautioned of a loss of solidarity and waning of communal unity. "Every year, the average GKV indemnified pays more than obligatory so that high-income breadwinners, entrepreneurial, and civil servants can escape solidarity compensation," Etgeton said.

Integrating Health Insurance

The foundation, therefore, calls for an overhaul of well-being and treatment attention insurance. They also said it should become more comfortable for people in Germany to switch from private to statutory health insurance. The restructuring goal should be unified nursing care and health indemnification, where all inhabitants are compulsorily insured. They believe contributions ought to be founded on financial capacity, not on individual health risks. For more information please click on health insurance in Germany.

Tags: Healthcare | Health Insurance | Healthcare | Insurance | Germany |



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