Health Insurance

Health Insurance

Germany spends more than a tenth of its economic product on its health sector, most of it going to the statutory health insurance funds.

In recent decades, the funds’ have only been able to keep revenues in line with rising expenditures by steadily raising their members’ contribution rates. The ageing of the population and medical progress will continue to drive up future health expenditures. However, the reasons for exploding costs are partly embedded in the system itself. The insured have nothing to lose by taking advantage of costly therapies and medicines because doing so has no direct influence on their contribution rate. If being more cost-conscious had an effect on patients’ pockets they would have a great interest in choosing the cheapest provider for the same service.

For this reason, it should be possible to vary the level of insurance contributions to reflect the choice of provider. In addition, the current income-related contributions for statutory health insurance should be replaced by a realistic insurance premium. Insurance cover for those with low incomes could be secured by means of a tax-financed subsidy.

Susanna Kochskämper

Susanna Kochskämper

Economist for Social Security

Tel+49 221 4981-887

Mailkochskaemper@iwkoeln.de

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Jochen Pimpertz

Jochen Pimpertz

Head of the Research Unit Public Finance, Social Security Systems, Income and Wealth Distribution

Tel+49 221 4981-760

Mailpimpertz@iwkoeln.de

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