Extensive Reductions Possible Without Adverse Effects on Care Provision

Germany’s Health Finance Commission (FinanzKommission Gesundheit, FKG) is to develop proposals for sustainably stabilising the contribution rates for statutory health insurance. The commission has just presented its first report. It intends, among other things, to identify key cost drivers and inefficiencies on the expenditure side, as well as problems on the revenue side, and to propose measures that are effective in the short term.

Professor Simon Reif, head of ZEW’s Research Group “Health Care Markets and Health Policy”, comments on the report:

“The commission has drawn up a comprehensive list of proposals. Although many of these had already been discussed before, within this broader scope they can now serve as a sound basis for a wide-ranging reform of the health care system.  Above all, the report shows that significant reductions in the burden on the health insurance system are possible without adversely affecting care provision.

Many of the proposals are aimed at increasing revenue, whether from the federal budget for recipients of Germany’s basic income or from insured persons who are currently covered without paying contributions. This focus is understandable, because the measures are to take effect quickly. However, as health care expenditure in Germany is already very high by international standards, particularly the proposed measures to limit expenditure growth are to be welcomed. A capping of expenditure growth at the rate of increase in health insurance revenue can be easily implemented both in medical practices and hospitals and would save several billion euros a year.

An increase in patients’ co-payments for medicines and hospital stays can, in principle, be justified by general price increases, but this proposal is primarily symbolic, as savings for statutory health insurance funds are expected to be insignificant and co-payments are unlikely to act as an effective behavioural lever.

Another important contribution by the commission is the provision of data on trends in expenditure and revenue within the health care sector. These types of calculations should be a regular component of health policy processes, rather than being produced on an ad-hoc basis by commissions.”