Health and Health Insurance in Germany

When I arrived in Germany 20 years ago, what I found hardest to get used to my university's requirement that everyone have health insurance. Without a document proving that you had health insurance, you could not even register. The monthly premium of DM68 (about NT$1200 in those days) was no small sum for an impoverished student like me.

Student health premiums were very reasonable compared to what most Germans had to pay, which was seven or eight times more. When I went abroad after graduating from college I had no experience of any sort of public health and labor insurance system, because in those days Taiwan still had no national health insurance program. I had always been in the best of health, and other than an occasional visit to the dentist, I had almost no contact with medical doctors and hospitals. I therefore considered my insurance payments a complete waste. I resented the fact that my insurance company was subsidizing a complete stranger's healthcare with my money.

In December 2005 the German weekly Stern published a special report entitled "Two Classes of Medicine" on discrimination against patients with statutory insurance.

Nothing lost, nothing gained

"Health insurance buys you peace of mind and good health is a blessing. You're better off spending a little money today, because the day may come when your insurance will spend a lot more money on you than you ever spent paying premiums." A friend of mine told me this by way of consolation.

But I still had a hard time accepting the wisdom of the words "nothing lost, nothing gained." I knew that some people, including my landladies, got away with not paying monthly insurance premiums. My landladies were an elderly mother and daughter. The mother was in her eighties, and they had no job or income other than the rent from the spare apartment in their small house. They were unwilling to spend what little money they had to spare on health insurance. Consequently, they had to watch their health very carefully and relied on home remedies whenever they fell ill. In winter they wouldn't leave the house for fear of slipping and breaking something, because a fracture would have cost them more than they could afford. They often asked their tenants to buy groceries for them. They lived the four seasons in fear, but fortunately no major illness befell either of them while I was their tenant.

At the time I envied my landladies for saving their insurance premiums. But several years later I realized that I should have worried about them. Old people are often in and out of hospitals. If you don't have insurance coverage in Germany, you can easily spend your family fortune on hospital bills.

So for years I paid my student health premiums. I would occasionally feel uneasy about it, and then I would get myself a pair of basic eyeglasses that were covered by my insurance (I would have had to pay myself for fancier frames). I was only slightly nearsighted and could have managed without glasses, but I figured that this way I was recouping the money I had paid in. It wasn't until I left university that I realized what a good deal the student health coverage I had moaned about had been. Now that I was no longer a student, the same insurance company changed my rating to 5, which meant that my premium went up from DM68 to DM320!

Barmer and AOK are Germany's largest statutory health insurers.

Three-tiered insurance

"Sheer extortion!" I vented my anger to a friend who had been working for years. She tried to reassure me: "Get yourself a job as quickly as possible; then you won't have to pay so much. Your boss will pay half your premium!" Under German law, employers are liable for half their employees' health premiums.

So that is why I had read in the financial pages that employers were always complaining that insurance companies raise their monthly premiums every few years, forcing them to lay off workers and making Germany's unemployment woes even worse.

But the major statutory health insurers such as BKK, Barmer, AOK, and TK, are also fed up with always being seen as the bad guys who raise premiums. They say that they can no longer afford to lose money every year and therefore have no choice but to take unpopular measures. The aging of Germany's population makes matters worse, because the elderly need more medical treatment and retirees pay lower premiums. The steady rise in unemployment also contributes to diminishing revenues and rising expenditures, because people without jobs or on welfare are exempt or pay only symbolic amounts.

To make matters worse, advances in modern medicine, the ever-growing number of diseases, and the development of expensive new drugs to replace existing ones are driving medical costs ever higher (pharmaceuticals alone account for 20% of health insurance expenditures). Even people on long-term sick leave receive full pay, which is covered by the insurer (the employer pays during the first six weeks of sick leave and the health insurer thereafter).

If the insurers are full of gripes, so are patients. They still have to pay considerable sums in statutory insurance premiums, on average 14% of their salary, but hospitals and clinics treat them like second-class citizens. Their lives would appear to be less valuable than those of the privately insured.

To discourage patients looking for freebies, in 2005 the statutory insurers began to charge an additional registration fee of 10. Within 100 days the number of people going to the doctor dropped by 22%.

Complaints all round

I remember seeing a woman with statutory health insurance coverage tell a personal anecdote in a TV debate a few years ago. Her aunt had gone to the hospital after feeling a lump in her abdomen. At the registration desk, they scheduled a checkup appointment a week later. Four days later her abdominal pain was so severe that she had to be rushed to the emergency room. The doctors found a tumor blocking her intestine and had to perform an emergency operation, remove a large part of her intestine, and create a colostomy. They said that if they had seen her a few days earlier, they could have proceeded calmly and her condition would not have been as critical.

The woman voiced widespread frustration over the prerogatives of the privately insured. They are allowed to jump to the front of the line, they can get a doctor's appointment within an hour of requesting one by telephone, even on a Friday (when most Germans get off work at noon), and they can request a specific surgeon to perform an operation (if they know he happens to be the best).

After the man had had his say, several other people on statutory health insurance protested that 90% of Germans are compulsorily insured, which is unfair to them and goes against the principles of social justice and equality. Known in German as Kassenpatienten, people with a monthly income below 3,860 (approx. NT$150,000) are required by law to be insured with a statutory health insurer.

Not to be outdone, a hospital spokesman who had been on the receiving end of criticism laid into the statutory health insurers for squeezing hospitals to the detriment of their professional staff and services. No wonder that ever fewer young people were studying medicine: Their numbers halved from 12,000 in 1997 to 6,800 in 2003, and 6300 of the latter group migrated overseas for work because of low salaries in Germany. If German doctors had to rely exclusively on patients with statutory health insurance, they would have to live on thin air.

The hospital spokesman also criticized the insurance companies for being unreasonable cheapskates that determined all payouts themselves and frequently set them pitifully low. They also imposed an excessive number of restrictions and required fixed reimbursements for specific medical conditions and procedures, unlike private insurance companies, which paid all medical bills without question. Doctors could only get an income above their salary if medical bills were paid in full (because public hospital salaries were very low).

German doctors take to the streets to demonstrate against low salaries and long hours.

An exasperating budget system

True enough. When I was living in Taiwan I thought that doctors were very well off and proud of it, but in Germany I discovered that they are government employees who earn about the same as schoolteachers. Even doctors who have their own private practice aren't much better off.

A Taiwanese friend of mine is married to a German doctor who has a private practice in the countryside. She told me that there was no other doctor for 50 kilometers around, that business was booming, and that hey had a steady stream of patients every day. A little envious, I told her, "You must be really raking it in." My friend shook her head, smiling: "It's not like you imagine. It's backbreaking work and you make very little money."

She explained that because statutory health insurers put an upper limit on the number of patients doctors can see and will not pay above that level, it does not matter how many patients a doctor sees. (This is similar to Taiwan's global budget system.) Beyond a certain number of patients the doctor is just doing charity work.

At the end of the TV debate, everyone laid into the insurance spokesman, berating insurers for their poor planning and countless rules. Hospitals wasted enormous personnel and material resources on forms and medical reports. On average, they spent 180 on paperwork per patient, and the cost was rising every year. The system was totally uneconomic.

Germans are traditionally argumentative, a trait they certainly displayed during this debate. Everyone put forward forceful and eloquent arguments. At the time I didn't understand everything they said. It was only many years later, when I became a long-term patient myself, that I finally came to understand the ins and outs of the German health insurance system.

Barmer and AOK are Germany's largest statutory health insurers.

The ranks of the privileged

I followed my friend's advice and looked for work, but I could not find any. Instead, I fell head over heels and marched down the aisle and into domesticity. My husband now generously paid my bills and in one fell swoop I went from the ranks of the masses with statutory health coverage to those of the privileged with private insurance. But I was still bursting with health in those days, and I thought that statutory and private health insurance were much the same, and that either way I was paying other people's medical expenses.

I never thought how quickly things could change. It was only when I had my first child that I had my first inkling of a difference between statutory and private health insurance, and that there are two classes of patients in Germany. Before the birth, my husband picked an expensive private maternity hospital in a quiet setting by a municipal park. We also chose the doctor who delivered our baby.

As soon as I left the delivery room, I moved into a single room with TV and a fully equipped bathroom. New mothers on statutory insurance are usually sent home four days after giving birth, but I stayed a full week. The hospital staff were extremely polite. Every day after 7 a.m. a cleaning lady knocked on the door to ask me if she could do my room. And every day a hospital nurse came to teach me postpartum exercises to help my uterus contract.

I remember a college friend of mine who gave birth in a public hospital in Munich. Being on statutory insurance, she had to share a room with three other mothers. There was a washbasin in the room, but to take showers and go to the toilet, they had to go to a communal bathroom. The worst was that they never had a moment's peace and quiet. My friend complained, "A cleaning lady kicks us out of bed before 6 a.m. With four mothers in the room, there is a constant stream of visitors, and twice every evening they holler at us to remind us that it's feeding time. I have barely slept a wink. I can't stand it." So there is a difference between statutory and private insurance. As they say, "you get what you pay for."

The second time I was hospitalized I was really sick. I had a laparoscopic gallstone removal operation and really felt like I recouped my losses from the insurance company. It was no laughing matter and I paid dearly with my health. If it had been up to me, I would have gladly paid a lifetime's worth of insurance premiums and not gotten my money's worth in hospital. But illness is something beyond our control. In the years that followed I was hospitalized several times to have tumors removed, and every tumor was more serious than the last. In my heart, I've apologized many times to my insurance company for my previous lack of appreciation.

When it rains, it pours. Not long after my surgery, my father needed a heart operation. Living thousands of miles away from home, I was worried sick for him. His operation was a success and as soon as it was over I phoned my mother in Taiwan to tell her to get him admitted to a sanatarium as quickly as possible. "A sanatarium? Where would we find such a place in Taiwan?" sighed my mother.

BKK, Barmer, AOK, TK are Germany's principal statutory insurers. Allianz is a major multinational enterprise, as well as one of Germany's largest private insurers. Patients with an Allianz card get all sorts of preferential treatment.

Taking a cure

It's funny, but having lived all these years in Germany I've gotten used to the sanatariums that are an integral part of healthcare system here. After major surgery, doctors often write out a medical certificate for the patient to recover in a public or private sanatarium. Even sanatariums in neighboring countries such as Austria and the Czech Republic are covered by German health insurers.

German statutory and private health insurers pay for sanatarium stays on the theory that they facilitate early recovery and reduce future medical costs, which benefits both the patient and the insurer. It is also thought that short stays are not very effective. To recuperate with complete rest of mind and body, patients stay in the sanatarium for at least a month. This policy is well meaning, but it can also make life difficult. My neighbor, Mr. Hubert, missed his only son's high school graduation ceremony because he was convalescing in a North Sea health spa.

Even people who aren't sick stay in these sanatariums. Once, my cleaning lady asked for three weeks off because she wanted to "take a cure" (people who are not ill stay for shorter periods). She explained, "My insurance pays for a cure every other year. It's a free vacation." I was amazed.

"When my children were small, we were able to go to a 'mother and child health spa.' Now that they have grown up, I go on my own." She said with the best of intentions: "Know your rights. The unemployed woman downstairs also takes a cure every other year."

"Why would someone who isn't sick to go to a sanatarium?" I wondered.

"Prevention is better than cure. Once you're ill it's too late." My cleaning lady held forth, "A homemaker has to attend to her household duties, her husband, and her children. It's a lot of pressure. You need to unwind now and then, so it's worth the cost. It's the only way to stay on an even keel emotionally. Otherwise, you'll wind up crazy or clinically depressed, and mental institutions cost much more money. Insurance companies are just doing the smart thing."

Seeing my cleaning lady speak with such assurance left me more dumbstruck than convinced. All I could say was that Germans have certainly been spoiled by their social welfare system.

German doctors take to the streets to demonstrate against low salaries and long hours.

Spiraling costs

Germany was the first country in the world to introduce a national health service. The system was introduced in the 19th century by Bismarck, the Iron Chancellor, and is deeply rooted in the German public consciousness. There is much that the Taiwanese people could learn from the German experience of more than a century. But over the years the system has also become increasingly unwieldy.

Hsu Shu-hsia, an expert who has studied the German health insurance system for years, says that that it has quite a few weak spots and that if it is to survive it will have to be reformed. Private insurance companies are mainly out to make money, but they are able to implement strategies with considerable flexibility and agility because they tend to be rather small and have fewer customers. The statutory health insurers, on the other hand, are huge bureaucratic machines. Because a single small change could affect the whole, reform is not something that can be rushed into. It has to be gradual and piecemeal.

So far, the big statutory insurers have only taken stopgap measures. But a thorough overhaul will require reeducating the insured public to regard hospitals as a last resort rather than a place you visit to "get your money's worth" even when you are not ill.

Fools need advice most, but only the wise are the better for it. We could save ourselves a lot of trouble by learning from the shortcomings of the German health insurance system. In any case, in Germany health insurance has come to be seen as a form of social welfare. The system loses more money every year, and there is no prospect of balancing accounts in the foreseeable future. But the system cannot be scrapped altogether, so Germans just have to do their best to reduce expenses and hope that spiraling costs will be brought under control.