Is it enough?

Date: 07/06/03

A controversial health-care reform plan is still not sufficiently radical

WHEN unveiling his proposed package of labour-market and welfare reforms this spring, Chancellor Gerhard Schröder described those for health care as “the most important and necessary part”. But anyone hoping for a truly radical revamp of the country's high-quality but hugely expensive and inefficient public health service will be glum. The bill approved by the cabinet last week has some bold bits, yet it is more an exercise in shuffling around the costs than a true restructuring of the system.

Germans spend more on health than anyone else in the world, bar the Swiss and Americans: €2,740 ($3,014) per head each year, amounting to 11% of GDP. That is nearly a third more than the European Union's average. Germans stay longer in hospital than almost everyone else, have more x-ray and ultra-sound examinations, swallow more medicines, and visit the doctor more often: researchers say that up to a half of consultations are unnecessary.

Most of the 90% of Germans who use the public health-care system are happy with it. They can choose their doctor and see him more or less whenever they want, without long waits. They can get an array of virtually free services, from false teeth and glasses to psychoanalysis and homeopathy. But they grumble more and more about contributions for health care taken out of wages, a cost shared equally by employer and employee. In the past decade that contribution has risen by a third, and now eats up 14.3% of gross wages.

To bring health spending back under control, the government is proposing measures meant to lop €20 billion off the public health service's €142 billion annual cost and to bring contributions back to under 13%. Certain non-health-related benefits, such as maternity grants, are to be transferred from the health service to general taxes. Germans will no longer be reimbursed for their purchase of glasses, artificial insemination or over-the-counter drugs, while they will also lose the current grant of €525 when a family member dies.

Moreover, under the new plan, patients must dig deeper into their own pockets for prescription drugs (euro4-8 per box, according to size, instead of the present flat rate of €4-5) and for staying in hospital (euro12 a day instead of the current €9). They must also pay a quarterly fee of €15 for visiting a specialist without a referral from their ordinary doctor. Most controversial of all, contributions for long-term sickness benefit will be paid by the worker alone and no longer by the employer too.

But the growing sophistication and expense of modern medicine combined with the rapid greying of Germany's population mean that such proposals are unlikely to check the country's spiralling health costs any time soon.

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