Germany: the coalition outlines the health-care reform

One of the most thorny issues of the reform (see our articles 06296, 06266 and 06681), the creation of a health fund gathering all health contributions before their payment into insurance schemes on a flat-rate basis, has been postponed to January 2009, instead of June 2008. In a risk compensation scheme, health insurances covering many illnesses, both chronic as well as those of old people, will receive extra financing from the fund. Another major feature is that insurance funds may demand a supplementary contribution from their members under a ceiling set at 1% of the insurant’s income. The Social Democrats succeeded in imposing this claim. In return, the CDU-CSU negotiated an exception to the rule: health insurance schemes will be allowed to get from their members up to 8 extra euros per month irrespective of income levels. In order to win the support of the CSU (the CDU’s Bavarian wing) for the reform, a financial compensation system must limit the extra payments from the richer to the poorer regions. Furthermore, private insurance schemes will henceforth have to offer basic rates equivalent to those of public insurance in order to ensure coverage for all. Lastly, new rules on medical fees are to come into force in 2009. The other measures presented last July remain unchanged. Health contributions will rise to 0.5% in 2007 and health coverage for children will be financed by tax revenues starting in 2008. The compromise met an avalanche of criticisms. Several CDU-CSU Minister-Presidents are suspicious of this new draft legislation, while the left wing of the SPD denounces an agreement worse than the one in July, while the opposition, health insurance funds and the unions are lambasting the compromise.