Fighting for survival

Health insurance in Germany has come a long way since sickness cover was introduced in 1883 under Kaiser Wilhelm I and his chancellor, Otto von Bismarck.

At the time, the average German worked a 60-hour week for a pittance, and sickness or accidents meant a very real threat of starvation. Public dissatisfaction was widespread, and it was against this backdrop that Germany started on the long road towards the welfare state it still more or less is.

But these days, less is the operative word. The social solidarity that has traditionally underpinned the German healthcare system is looking increasingly frail. The basic problem is that German society is ageing, while its birth rate is sinking. This means that healthcare costs are rising while fewer people are paying into the system.

Many believe that what the only way to rejuvenate the system is to expose it to market forces.

Rising costs

But this would mark a dramatic break with Bismarck's original program. Made up of health insurance; accident insurance; disability insurance and an old-age retirement pension, it was based from the outset on the principle of solidarity: anyone who was employed was obliged to pay into the system and anyone who fell ill would receive medical care and a living allowance. The cost was divided between employers and the employed - the employers contributing one third, the workers two thirds.

The ratio has changed since then - and so have many other aspects of the German health care service. The last 20 years alone have seen 14 health care reforms. While the initial health care restructuring was designed to provide more efficient and cost-effective healthcare services, the most recent reforms focus more on the structure of health insurance funds.

One way or another, most of them have been bad news for the public. Personal contributions to dental care and medicine costs have gone up, and patients now have to pay a mandatory 10 euros ($14) per quarter whenever they go to the doctor.

Dissatisfaction

So although the German healthcare services are still more or less all-inclusive, the cracks are showing. And it's not just patients who are noticing. Medical and healthcare professionals also say that conditions are worsening.

"Everything has gone downhill," says one nurse who works in a hospital in Bonn. "We all have less time, there are so many cuts, patients are dissatisfied, especially the elderly ones."

Doctors are also fed up, and say the system is flawed. Dorothee Keltz is a GP with a practice in Bonn. She believes it's important to take the time to talk to patients, and resents the fact that insurers prefer to see doctors using technical equipment.

"If one of my assistants does a cardiogram and we tell the patient what our findings are, we make three times as much money as we would if we spent 10 minutes talking to the patient," she complains.

Another problem is that doctors have had to start relying on private patients to stay afloat. In Germany, only 10 percent of the population has private, for-profit insurance - mostly civil servants and the self-employed. Increasingly, doctors are realizing that patients with state health cover are just not profitable enough.

Patients as pawns

Still, the stakes are high. The German health care system averages an annual turnover of over 250 billion euros, making it one of the nation's most important economic sectors.

It's also a sector in which powerful interest groups from trade associations to pharmaceuticals companies are constantly jockeying for position. German Health Minister Ulla Schmidt is well aware of the tensions.

"No other sector has the financial clout of the health service," she says. "The amount of money spent on it exceeds the entire federal budget. The sector's players are dealing with huge funds with which they can buy opinion, influence opinion and promote their products. In this respect it is patients themselves who are in the weakest position, even though they should be the strongest, because 70 million people in Germany have state health cover."

But the public is often little more than a pawn in a game, and has little insight into what is being spent and how. The new cornerstone for funding German health care spending is the controversial and highly complex 'Gesundheitsfond', the health care fund. Supposedly, it aims to simplify health benefits, provide more choices, increase transparency and create competition among providers.

But its detractors believe that it fails to address the increasingly urgent issue of funding the enormous German system. It makes no mention of reducing cost, they say, but simply spreads the cost risk differently.

In the wake of the financial crisis, saving costs has become more important then ever. After numerous attempts at resuscitation, the solidarity principle introduced by Bismarck could well be on its last legs, and Germany's two leading parties cannot agree whether it should be kept on life-support.

Social Democrat Ulla Schmidt, for one, would like to give it another chance and abolish private health insurance altogether. But ultimately, today's social and economic forces are nudging Germany more in the direction of a healthcare system built on individual responsibility. The issue will certainly be on voters' minds when they go to the polls this month.

Monika Lohmueller (jp)

Editor: Chuck Penfold