German Medical System 101

Ronni asked her non-US readers to write about how our universal (social/national) medical insurance systems work. One aspect that I find interesting about the debate in the US is how little differentiation is made between the existing universal medical insurance systems. Instead, the discussions seem to be stuck with the “Yea or Nay for Health Care Reform”. So much of what I am reading these days has to with the analysis of the poor behaviour of the nayists. Their tactics and arguments rob me of words. I do hope that Ronni’s idea of each of us writing posts the next two days has a positive effect in some way or manner to the debate.

In Seth Godin’s recent blog post, “Willfully Ignorant vs. Aggressively Sceptical”, he presents a short astute argument to those people who openly oppose health reform. He writes, “If you want to challenge the conventional wisdom of health care reform, please do! It'll make the final outcome better. But if you choose to do that, it's essential that you know more about it than everyone else, not less.”

Even if the differences in the various systems are not highlighted or discussed, it would be advisable for people on both sides of the argument to take a look of these systems and try to decide which components they like best. There are a slew of articles available out there that point out the differences. Admittedly, many of them are not written from the patient’s point-of-view, which is why I thought I’d write about how the German social medical insurance system works from a user’s perspective.

It is actually a very easy system to understand; it is a two-tier system where you can decide yourself if you want to be state insured or privately insured. Most people opt for the state system.

The principal reason some people go private is out of costs reasons. If you earn a relatively high income, it can be less expensive to be privately insured. All people, whether privately insured or state insured, go to the same doctors’ offices and hospitals. You chose whom you want to go to and where you want to be treated. You can choose general practitioners or specialists according to your will.

There is a selection of state run insurance agencies to choose from. Each agency has to compete against each other in services offered and costs. They all offer the following:

Children (under age 18)

Children and students are insured under one of their parent’s insurance policies at no extra cost. This insures that 100% of your children’s health costs (medical and dental) are covered for all short term or long term diagnostics or therapies. All prescription drugs are paid by the insurance company. You go to a pharmacy with a prescription slip and they hand you over the drugs; the pharmacies deal directly with the insurance companies for recompenses. With certain chronic illnesses (e.g. neurotmesis, asthma, allergies), recognised alternative medicine therapies (e.g. homeopathy, acupuncture) are also paid for.

If your child is sick, each parent is able to take up to 10 days of “child sick leave” per child per year. The insurance company compensates 75% of your salary for these sick days you’ve taken because of your child’s illness. If your salary is below a certain income, 100% is compensated.

All billing formalities are carried out directly between doctors’ offices, hospitals, and insurance agencies: you go to the hospital or doctor’s office, they swipe your insurance card through the computer, you receive medical advice and then you go home to get better. Basta!

Adults (> 18 years and employed)

Insurance pays 100% medical and dental costs. Up until recently, this really was 100%, but in the last few years some of the selective (e.g. dental crowns) and cosmetic (e.g. plastic surgery) procedures are only partially covered. If there is any indication that such a procedure (e.g. breast reduction) is not solely cosmetic (e.g. back aches), the insurance company will pay for 100% of the costs.

Most people have a general practitioner they go to. This doctor,

• cures you of most of your ills,
• writes you your prescriptions,
• writes you off on sick leave,
• and makes recommendations for you to various specialists for both preventive procedures (e.g. mammograms), as well as acute diagnostic or therapeutic procedures (e.g. at a cardiologists).

Any procedure that is needed to be done immediately, you usually can get an appointment at a specialist or hospital right away. For preventive procedures, you might have to wait a 2-3 weeks for an appointment at a specialist.

Your state insurance company compensates you your income if you are ill for longer than a six-week duration. Under six weeks, your employer continues to pay your salary.

The insurance costs are a fixed percentage of your monthly salary. At the moment, the costs are somewhere between 12-13% of your salary. Your employer matches and pays the same amount (i.e. 12-13% of your salary) to your state insurance company. Thus, there is no necessity for company health insurance policies. (Therefore, it doesn’t matter if you are a large corporation or a small business, you pay the according to the number of employees and their income.) The monthly payment is automatically transferred from your pay check.

Students (> 18 years and not yet graduated from university)

Insurance pays 100% medical and dental costs. Your insurance rates are approx. 100 USD per month.

Adults (> 18 years and unemployed)

Insurance pays 100% medical and dental costs. Your insurance rates are paid by the unemployment agency or social services.

Adults (retired)

Insurance pays 100% medical and dental costs. Your insurance rates are paid by the state pension plan.

What I am hoping to convey in this post is that when talking about Health Care Reform, we don’t talk about the quantity of care, this is what doctors provide, but about the services offered and prices paid. And, these things do vary. The medical system in Germany has evolved over the decades. It is always changing, and so will the US system once it gets set up.

My personal belief is that any medical system that doesn’t offer full coverage for all people at competitive prices is a system that is ill. By all accounts, full medical and dental coverage in the States is almost unpayable for the average family. Why not just say, “Yea to Health Reform”, it would be the beginning of a long journey for all and not the collapse of a system for the few.