What will happen to the dual health system?

Dhe privately insured people in Germany have just got lucky again. Given the poor performance of the Die Linke party, they are spared a red-red-green coalition. This alliance could have abolished private health insurances and more or less forcibly transferring their members to the statutory health insurance funds.

Because all three parties, the SPD, the Left and the Greens, want to introduce so-called citizens’ insurance. Everyone would have to pay into this, and if necessary it would also cover other types of income with contributions in addition to wages, for example rental income.

This radical upheaval is off the table for the time being, as the Union or the Free Democrats will be involved in the next government, who want to hold on to the coexistence of statutory health insurances (GKV) and private insurances (PKV). At the moment it looks like there will be a traffic light coalition, an alliance of the SPD under Chancellor Olaf Scholz with the Greens and the FDP.

Deviating positions are likely to lead to tension

The different positions between the bourgeoisie and the left created a “high potential for conflict” in the formation of a coalition, writes the Institut der deutschen Wirtschaft (IW) in an as yet unpublished study on “Statutory health insurance after the election”.

Health and care do not come first in the talks. But the issues should be brought into the game of political compromise as a bargaining chip. And here it is unclear how steadfast the Liberals are in questions of private insurance, freedom of contract, the personal responsibility of patients and those in need of care, or in reducing the number of hospitals they are aiming for.

In the black-red coalition there had been a kind of truce, also known as the “Tu-nix-Deal”. The SPD postponed the citizens’ insurance, while the Union abandoned its plans to advance private health insurance, for example by setting contributions more flexibly. Now the weights for the private health insurance side are less favorable than before: The FDP parliamentary group only represents a fifth of the traffic light alliance in the new Bundestag, while the union in the old constellation put two thirds in the scales.

So far there have been no public statements

Those involved do not want to express themselves openly. It is clear, however, that the “traffic light” should not fail because of the different ideas about health and care. On the contrary, it is said that there are some similarities. For example with the reform of emergency care or the introduction of a uniform remuneration system for outpatient and inpatient interventions.

According to reports, the SPD and the Greens do not want to insist on citizens’ insurance against the FDP, but they do want to introduce elements of it. One would like to open the GKV to civil servants and members of parliament, but voluntarily and without suffering any disadvantages. Because these people tend to have higher incomes, are healthier and incur less costs, more money comes into the system.

In this way one can also compensate for the loss of income of the doctors. In fact, the privately insured play a major role: They make up only 10 percent of the population, but contribute more than 20 percent to the fees of resident doctors.

More than 50,000 euros less per doctor’s practice

In total, the PKV Association calculates, after the introduction of a standard insurance, 12.7 billion euros would be missing every year, half of which is in outpatient care. If there is no compensation, every medical practice would have to forego 55,000 euros per year. According to an expert opinion, such a compensation would increase the cash contributions by 0.5 percentage points. For an average earner, that would be an additional 200 euros per year.

But the Greens and the SPD are no longer aiming for such a complete break in the system in a coalition with the FDP. “We will find a way without losing face, in which the financial deficits do not increase, but rather decrease,” says a health politician involved. Red-green could tell their own voters that they are on the way to public insurance.

The FDP could advertise with new freedom of choice in the still dual system and so that nobody suffers losses. Finally, private insurance companies would have the option of offering more supplementary insurance instead of full insurance.

Compromises are not enough to close the billion-euro gap

A completely different question is whether such compromises are enough to fill the billions in the coffers’ gap. According to science, the system cannot survive without higher tax grants or contributions if there are to be no cuts in benefits. In a new study, the economic research institute IW writes that a lot is being said about “two-tier medicine” and “solidarity”.

But no party, with the exception of the FDP, is addressing the actual weaknesses, namely that pay-as-you-go systems are passing the sharply increasing expenditure on to the younger generations. In order to create an “intergenerational solidarity”, the contribution-financed share of the service expenditure must be permanently limited, argues the author Jochen Pimpertz.

In addition, it is important to set up a “second pillar” whose premiums are not based on income, but on the risks covered. This funded variant with optional tariffs based on the so-called entitlement cover procedure would also ensure competition in the insurance market and thus increase efficiency.

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