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Mandatory health insurance enacted

Country: 
Deutschland
Partner Institute: 
Technische Universität Berlin
Survey no: 
(13) 2009
Author(s): 
van Ginneken, Ewout and Reinhard Busse
Health Policy Issues: 
Rolle Privatwirtschaft, Finanzierung, Zugang, Vergütung
Current Process Stages
Idee Pilotprojekt Strategiepapier Gesetzgebung Umsetzung Evaluation Veränderung/Richtungswechsel
Implemented in this survey? nein nein ja ja ja nein nein

Abstract

The 2007 “Act to Strengthen Competition in Statutory Health Insurance (SHI)” obliges all residents to take out health insurance, effective from 2007 for sickness funds and from January 2009 for private insurers. Although the number of uninsured persons in Germany is small compared to other countries, it has been rising over the last decade. Both sickness funds and private insurers now have to accept all eligible persons. Private insurers will have to offer a basic benefit package.

Purpose of health policy or idea

In Germany sickness fund membership is mandatory for employees whose gross income does not exceed a certain threshold (€4050 per month in 2009). This threshold was gradually increased over the last decade to reduce the number of high earning voluntary members leaving statutory health insurance. People earning more than this threshold can voluntarily join or stay in a sickness fund or take out substitutive private health insurance. As of 2007, 85% of citizens are insured through sickness funds, 10% took out private health insurance (including 5% civil servants with partly free governmental care and complementary private insurance) and 4% of the population was covered by other, sector-specific governmental schemes (e.g. military, police and for immigrants seeking asylum).

Although it is often assumed that the German health care system offers de facto universal coverage the number of uninsured persons has been rising gradually over the years. Latest estimates by the Ministry of Health (MoH) was 300 000 in 2005, other sources (federal statistical office) state 210 000 in 2006. However there is increasing evidence that the actual number might have been substantially higher, as the legislator had made it more difficult to (re)join the SHI scheme to prevent persons from returning from private insurance once they get older and are facing higher premiums (cf. Health systems in Transition Profile Germany 2009, upcoming).  

The formal obligation for all citizens to take out health insurance, either statutory health insurance, effective from 2007, or private health insurance, effective from 2009, aims to reverse this trend. Uninsured persons last insured through membership of a sickness fund have to return to a sickness fund; uninsured persons last insured through private insurance have to take out private insurance; uninsured persons never previously insured have to be insured in the system which is primarily applicable (e.g. HI for self-employed). To make it easier for persons to (re-)enter private insurance, a statutory defined 'basic premium tariff (Basistarif)' has to be offered, uniform for all private insurers and all applicants irresspective of age, sex and health condition. Although private insurers may still carry out a health check or risk assessment (at their own costs), they may not refuse clients or charge additional fees for 'high risk' persons choosing the basic premium tariff. The premium level is set at the maximum sickness fund contribution level (approximately €570 per month in 2009). 

Main points

Main objectives

Increase coverage / universal coverage through the obligation for uninsured persons to take out health insurance and the obligation for sickness funds and private insurers to contract all eligible persons who wish to join their organisation.

Type of incentives

Starting from January 2009, not having health insurance is regarded an administrative offence; uninsured persons after this date will have to pay for outstanding premiums with a maximum of 4 years in total.  

Groups affected

Formerly insured persons, statutory health insurance, i.e. sickness funds, private health insurance

 Suchhilfe

Characteristics of this policy

Innovationsgrad traditionell neutral innovativ
Kontroversität unumstritten kaum umstritten kontrovers
Strukturelle Wirkung marginal recht marginal fundamental
Medienpräsenz sehr gering recht hoch sehr hoch
Übertragbarkeit sehr systemabhängig recht systemneutral systemneutral

The principle of compulsory insurance is easily transferable in theory. However in some countries this may be met with political resistance.

Political and economic background

In 2007, Germany's 'Grand Coalition' between the Christian Democrats (CDU) and the Social Democrats (SPD), adopted a reform ("Act to Strengthen Competition in Statutory Health Insurance" - GKV-WSG) to strengthen competition in the statutory health insurance system. The Act can be seen as a compromise between the Christian Democratic plan to introduce flat rate premiums while leaving the division between statutory health insurance and private health insurance intact; and the Social Democratic plan to introduce a compulsory universal health insurance, uniform for all citizens. The core elements of the reform include:

  • central pooling of contributions in a health fund (c.f. HPM report "Health fund now operational"),
  • introduction of a morbidity-oriented risk structure compensation scheme for allocating payments from the health fund to the sickness funds acting as third-party payers (c.f. HPM report "Morbidity-based risk structure compensation"),  
  • a uniform contribution rate, for the first time set by the government and not by sickness funds individually.

Part of this major health reform was the formal obligation for all citizens to take out health insurance, either statutory health insurance or private health insurance.

The reform introduces more restrictive rules for taking out private health insurance, thereby reducing choice for part of the population. While so far insurance holders could opt out of a sickness funds once their income exceeded a certain threshold, this threshold now has to be exceeded for three years in a row. This provision is intended to increase solidarity and financial fairness in health insurance: high-income earners can no longer leave SHI as easily anymore and their contributions will remain within the solidarity based statutory health insurance system.

The reform also intended to make access to private health insurance easier and less costly for certain groups of the population (e.g. for those that used to be privately insured and could not afford the premiums anymore or for elderly insured with high premiums), since private health insurers are required to offer a basic premium tariff from January 2009. New insurees can choose this basic premium tariff without additional premiums for higher risks. The basic tariff includes benefits similar to those offered in social health insurance and insurers cannot exclude any health services. This provision is further hoped to hinder risk selection. Although the law did not explicitly foresee this, all private health insureres have agreed to pool their risks from offering the basic premium, thereby creating a small-scale "risk-structure compensation scheme" among them.

Change of government

introduced as part of the GKV-WSG reform drafted by the then new Grand Coalition.

Purpose and process analysis

Current Process Stages

Idee Pilotprojekt Strategiepapier Gesetzgebung Umsetzung Evaluation Veränderung/Richtungswechsel
Implemented in this survey? nein nein ja ja ja nein nein

Origins of health policy idea

The idea for an obligation to take out health insurance has gained popularity in recent years parallel to the increase in uninsured persons. Although an obligation to take out health insurance is widespread across Europe, the need in Germany was less obvious as it was assumed that de facto universal coverage existed. Since many years, the main proponent of this obligation in Germany were the Social Democrats (SPD) - even though their main aim was to create one "citizens' insurance scheme", i.e. to combine SHi and PHI.

Initiators of idea/main actors

  • Regierung
  • Kostenträger
  • Politische Parteien

Approach of idea

The approach of the idea is described as:
renewed: Obligations to insure for health costs, sometimes called “health mandates” or compulsory/mandatory health insurance, are common around the world, also in other insurance fields were high costs for the individual may occur.

Stakeholder positions

Most involved actors agreed on the need to reduce the number of uninsured although it never appeared to be a pressing issue. As the obligation was a relatively small part of a wider reform of the German health care system, it never formed a breaking point in the decisions but was nonetheless subject of a compromise between the coalition partners (see section "Influences in policy making"). Private health insurers were opposed to the reforms as they opposed the idea of a basic premium tariff, not the goal of reducing the number of uninsured persons. In the end, however, they contributed to the implementation by pointing out that merely a right to health insurance (with insurers being obliged to accept anybody) could lead to people seeking insurance shortly before treatment, and then cancelling insurance afterwards.

Actors and positions

Description of actors and their positions
Regierung
Ministry of Healthsehr unterstützendsehr unterstützend stark dagegen
Kostenträger
SHIsehr unterstützendneutral stark dagegen
PHIsehr unterstützenddagegen stark dagegen
Politische Parteien
Social Democratssehr unterstützendsehr unterstützend stark dagegen
Christian Democratssehr unterstützendneutral stark dagegen

Influences in policy making and legislation

The obligation to take out health insurance is a long standing goal of the Social Democrats. As a compromise with the Christian Democrats, the basic premium for the private health insurance was not introduced until 2009 (instead of 2008) and the opportunity for already privately insured persons to change to the basic premium tariff was limited to the first half of 2009. After this half year, only insured people 55 years and older, persons with special needs and new applicants may opt for the basic premium tariff. This compromise was then incorporated in the GKV-WSG Act of 2007.

Legislative outcome

success

Actors and influence

Description of actors and their influence

Regierung
Ministry of Healthsehr großgroß kein
Kostenträger
SHIsehr großneutral kein
PHIsehr großneutral kein
Politische Parteien
Social Democratssehr großsehr groß kein
Christian Democratssehr großgroß kein
Ministry of HealthSocial DemocratsSHIChristian DemocratsPHI

Positions and Influences at a glance

Graphical actors vs. influence map representing the above actors vs. influences table.

Adoption and implementation

The implementation of the obligation primarily demands action from the side of uninsured persons. They will now have to take out health insurance on their own initiative. The MoH has tried to reach these groups through mass media advertising, flyers and a website (www.die-gesundheitsreform.de). Also sickness funds and private insurers have informed their insured populations about the changes and the implications this may have.

Monitoring and evaluation

No formal evaluation was foreseen. However, changes in the level of uninsured persons can be seen in the German 'microcensus' data, which provides official representative statistics of the population and the labour market in Germany. If any undesired effect would occur in terms of coverage, many groups (e.g. scientific community, media) would most probably signal this immediately also because of the politically sensitive nature of the topic, i.e. level of uninsured persons.

Results of evaluation

According to claims by the Ministry of Health in early 2009, thus far 160 000 persons have returned to a sickness fund and 24 000 persons have returned to a private health insurance plan. This implies that a group of roughly 50 000 people remain uninsured based on the assumption that the number of 211 000 uninsured before the reform -provided by the Federal Statistical Office - is correct. This would mean that the measure has been successful but that also one in four persons is still without health insurance. However, microcensus data from 2007 show that on average 196 000 persons were uninsured during that year, i.e. at least initially the effect of the reform war marginal.

Furthermore, it remains to be seen at this point whether the reform may have as a side effect an increase in defaulters (see section "Expected outcome").

Expected outcome

  • Although the number of uninsured persons has been reduced substantially, there still remains a group of uninsured people, the size of which is unclear.
  • Furthermore, various sources report that the people who have returned to their sickness funds are often defaulting more than proportionally on their contributions, which leads to substantial shortfalls. Since financial sanctions do not exist and policies cannot be cancelled, the sickness funds have to cover/compensate these shortfalls with revenue obtained from the contributing members. This may make health care less accessible in the long run through increased premiums or less reimbursed health services. It is doubtful that this reform, or any reform for that matter, can overcome the situation with defaulters.
  • The reform leaves the separation between statutory health insurance and private insurance intact. Persons formerly privately insured have no opportunity to return to a sickness fund unless they become employees with an income below the threshold of €4050 per month (2009).
  • The basic premium may be unaffordable for groups of self-employed with a relatively low income.
  • Starting from January 2009, not having health insurance is regarded an administrative offence; uninsured persons after this date will have to pay for outstanding premiums with a maximum of 4 years in total. Certain groups can be expected to run up debt quickly. 

Impact of this policy

Qualität kaum Einfluss kaum Einfluss starker Einfluss
Gerechtigkeit System weniger gerecht System weniger gerecht System gerechter
Kosteneffizienz sehr gering sehr gering sehr hoch

Impact on equity: The obligation is hoped to make the system more equitable by increasing the number of persons insured in the solidarity-based SHI and by making it more difficult to change to private health insurance. Furthermore, the introduction of a basic premium for private health insurance is hoped to make health care more affordable for certain groups of privately insured persons with high premiums. However, even the basic premium may still be unaffordable for certain groups. In short, the reform may have a small positive effect on equity in the system but it does not alter the bigger picture: also this reform leaves the two separate systems (public vs private) intact. This implies that there is no solidarity between these two systems. Healthy people who are rich, for example, may still enjoy lower premiums in their private health plan than they would have had in a sickness fund.

References

Sources of Information

Busse, R./Riesberg, A. (2004): Health care systems in transition: Germany. Copenhagen, WHO Regional Office for Europe on behalf of the European Observatory on Health Systems and Policies

Busse, R./Riesberg, A/Blümel, M. (upcoming ): Health systems in transition: Germany. Copenhagen, WHO Regional Office for Europe on behalf of the European Observatory on Health Systems and Policies

Lisac, M./Reimers, L./ Henke K.-D./ Schlette, S. (2007): Access, Choice and Guidance in German Health Care: An account of health policy reforms since 2004, TU Berlin, Wirtschaftswissenschaftliche Dokumentation

Lisac, M. (2006): Health care reform in Germany: Not the big bang. Health Policy Monitor, November 2006 www.hpm.org/survey/de/b8/2

Author/s and/or contributors to this survey

van Ginneken, Ewout and Reinhard Busse

 

Empfohlene Zitierweise für diesen Online-Artikel:

van Ginneken, Ewout and Reinhard Busse. "Mandatory health insurance enacted". Health Policy Monitor, May 2009. Available at http://www.hpm.org/survey/ger/a13/1