In international comparison, Germany ranks 4th among OECD countries in health expenditure as a share of GDP in 2011. It amounted 11.3% of GDP in 2011 which is 2%-points above the OECD average of 9.3%. Only the United States (17.7%), the Netherlands (11.9%) and France (11.6%) are spending more on health. In addition, German health expenditure increased, in real terms, at a rate of circa 2% p.a. on average in 2000-2010, but slowed down to 1.1% in 2011.
However, expenditure continues to grow. With regard to these figures, health care is one of the most important sectors in Germany. With more than 6 million employees and a gross value added of almost € 268 bn in 2013, it represents 11% of the German economy. While expenditure is on the rise, the number of contributors who finance the health care system decreases. As a result, the question of how to finance the growing demand for health services occurs.
In particular, a closer look at the statutory health insurance (SHI) is necessary as it financed 57% of total health expenditure in 2011. Since the report “Achieving financial sustainability for the social security systems” by the Rürup-Commission, two major reform proposals are discussed: the citizens' insurance (“Bürgerversicherung”), a universal system of health care, and a system of flat-rate health premiums (“pauschale Gesundheitsprämien”). These approaches are intensively discussed by politicians and economists who search for an appropriate solution for a health care reform.
Therefore, the following question should be answered by this seminar paper: Should we move to a universal, flat rate system? In order to develop an appropriate recommendation, the following questions appear:
How does the current health insurance system in Germany look like? Which problems does this system face? What contribution do the two reform proposals provide for a solution of these challenges? Which are the main arguments in favour and against these approaches? Are there any economic consequences of their implementation? What could be a final solution?
These questions will be responded in the following seminar paper.
Table of Contents
1. Introduction
2. Status quo of the German health care system
2.1 Set-up
2.2 Challenges
3. Universal system
3.1 Definition
3.2 Discussion
3.3 Economic impacts
4. Flat-rate system
4.1 Definition
4.2 Discussion
4.3 Economic impacts
5. Universal, flat rate system
6. Conclusion
Research Objectives and Topics
This seminar paper investigates the potential shift of the German statutory health insurance system towards a universal, flat-rate model, evaluating whether such a reform can effectively address the financial and structural challenges posed by demographic change and rising health expenditures.
- Analysis of the current status and limitations of the German statutory health insurance.
- Examination of the "citizens’ insurance" (universal system) approach and its implications.
- Evaluation of the flat-rate health premium model as an alternative reform path.
- Assessment of the macroeconomic consequences of both proposed reform models.
- Discussion of combined reform approaches and their potential for sustainable health financing.
Excerpt from the Book
3.1 Definition
According to the Rürup-Commission, the “citizens’ insurance” is a universal health system which covers the entire population. The redistribution function is an essential element of this proposal as it is financed by income-related contributions. Furthermore, the tax base is widened on the total income, the insurance limit is abolished and the income threshold is raised. Therefore, private insured persons as self-employed and civil servants will become members of SHI and capital and rental income will be liable for contributions. Additionally, contributions are paid by employees and employers and the PHI has to concentrate on supplementary insurances as basic care is only provided by SHI (Bundesministerium für Gesundheit, 2003, pp. 148-149).
A universal system is especially discussed by the left parties in Germany (INSM, 2011). The approaches of SPD, Bündnis 90/Die Grünen and Die Linke often do not represent a consistent concept but a set of different reform measures (Augurzky & Felder, 2013, p. 10). Therefore, the following discussion and analysis are based on the Rürup-model.
Summary of Chapters
1. Introduction: Provides an overview of Germany's health expenditure rankings and outlines the two primary reform proposals being debated for the statutory health insurance system.
2. Status quo of the German health care system: Details the current structure of statutory health insurance, its financing mechanisms, and the significant challenges arising from demographic change and increasing costs.
3. Universal system: Defines the citizens' insurance model and critically evaluates its theoretical and macroeconomic impacts, particularly regarding social justice and potential labour market effects.
4. Flat-rate system: Explores the alternative of flat-rate health premiums, discussing how decoupling health financing from labour costs could improve sustainability and economic efficiency.
5. Universal, flat rate system: Examines models that combine elements of both universal coverage and flat-rate premiums to leverage the respective advantages of both approaches.
6. Conclusion: Summarizes the key findings and concludes that while there are compelling arguments for a flat-rate model, a comprehensive reform remains unlikely due to divergent political opinions.
Keywords
Health Insurance, Germany, Rürup-Commission, Statutory Health Insurance, SHI, Private Health Insurance, PHI, Citizens' Insurance, Flat-rate Premiums, Healthcare Reform, Demographic Change, Economic Impact, Labour Costs, Social Security, Universal System.
Frequently Asked Questions
What is the primary focus of this seminar paper?
The paper examines whether Germany should transition from its current health insurance system to a universal, flat-rate system to solve existing financial and structural problems.
What are the central themes discussed in the work?
The central themes include the sustainability of health financing, the impact of demographic change on insurance revenues, and the economic effects of different contribution models on the labour market.
What is the primary research question?
The research question is: "Should we move to a universal, flat rate system?"
Which scientific methods are utilized in this analysis?
The paper relies on a comprehensive literature review and the evaluation of macroeconomic simulation and forecasting models, such as the QUERU and PANTA RHEI models.
What is covered in the main section of the paper?
The main section evaluates the "citizens' insurance" (universal system) and the "flat-rate system," analyzing their definitions, intended goals, economic consequences, and potential for improving overall system sustainability.
Which keywords characterize this work?
The work is characterized by terms such as Health Insurance, Healthcare Reform, Statutory Health Insurance (SHI), Flat-rate Premiums, and Demographic Change.
What are the main arguments against the citizens’ insurance?
Critics argue that it may create bureaucratic structures, potentially discourage high-income earners, and that the redistribution of income is better managed through the tax system rather than the health system.
Why are flat-rate premiums considered a potential solution for labour costs?
Because they are income-independent, they decouple health financing from wages, which removes the burden of health contributions from labour costs, theoretically fostering higher employment.
- Arbeit zitieren
- Anonym (Autor:in), 2014, Health Insurance Reform in Germany. Moving to an Universal, Flat Rate System?, München, GRIN Verlag, https://www.grin.com/document/300346
