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“Health Insurance Companies Are Frozen because of Additional Fees like a Deer Caught in Headlights”

“Health Insurance Companies Are Frozen because of Additional Fees like a Deer Caught in Headlights”

photo: Gerd Glaeske

Gerd Glaeske is head of the Department of Health Economics, Health Policy and Health Services Research at the Center for Social Policy in Bremen. spoke to the expert about the fund and found out why the distribution of the funds is still unfair. Mr. Glaeske, has the fund improved the German health care system?

Gerd Glaeske: Absolutely not as it does not solve any of our genuine problems. The fund should hedge the financing of our health care system and make it viable for the future. But it does not. What do you criticize?

Glaeske: Mainly, that we still have the same financial basis: health insurance fees are still pegged to wages. However, this is problematic as funds will be immediately low when unemployment rises. To stabilize the system it is important to make it more independent of the economic development. This could be realized by taking other incomes - like rental or investment incomes - into account. Before the fund has been established you had argued against a uniform premium rate of 15.5 percent.

Glaeske: Yes, because 15.5 percent are too low in my opinion. That is why we already have a deficient cover of the fund by now. I also believe that there should be more competition between health insurance companies. Competition is extremely restricted because of the uniform premium rate. Brisk competition forces companies to think about effective structures and forms of organization. At the moment, there is little under way. All insurance companies are mainly busy with the economical management of their funds in order to avoid charging additional fees as these are bad for the competition. The companies are frozen because of additional fees like a deer caught in headlights. Will health insurance companies have to charge additional fees?

Glaeske: I think that some will have to by the beginning of the next year at the latest. Before the health fund has been established the Federal Ministry of Health had praised the morbidity oriented risk structure compensation scheme (Morbiditätsorientierten Risikostrukturausgleich, or short: Morbi-RSA) as a good tool allowing a fair distribution of the funds.

Glaeske: In principle, I agree. The old RSA took only the insurants’ age and sex into account but not their illnesses. For example, an insurance company got 1,800 euros for a 60 year old woman per year, no matter if she was ill or not. If the woman was healthy, the insurance company made a profit. That is why the mad rush for healthy people started. Some health insurance companies were left with the invalids, their costs raised and as a consequence they had to raise premiums. Thus, they got lost in the whirlpool of competitive disability. Hence, the Federal Constitutional Court decided that a morbidity oriented risk structure compensation scheme has to be created. The judicial requirement has been put into practice with the new Morbi-RSA.

Glaeske: Yes. The Morbi-RSA ensures that insurance companies get more funds for sick insurants than before. However, the distribution of the funds is still unfair as the treatment of widespread diseases like diabetes, which is highly paid now, is not always that expensive. On the other hand, companies which have to pay the treatment of expensive diseases like rheumatoid arthritis get too little money. That is due to the fact that the allocation of the funds is geared to the reality of medical supply. Medical supply was extremely bad for people suffering from rheumatoid arthritis since they were often treated with cheap and not sufficiently effective drugs. I wished we would have created a compensation scheme targeting a better treatment. How could this be realized?

Glaeske: The catalogue of drugs should be updated considering current medical research, for example. If a patient is suffering from rheumatoid arthritis, he will need special drugs, so called biologicals. However, if the physician prescribes these expensive drugs, he will get into trouble with the insurance company. That is why he usually will not prescribe them. And the insurance companies have no reason to pay attention to a correct treatment. Therefore, in my opinion qualitative indicators have to be taken as a basis for a new compensation scheme by all means.

The interview was conducted by Sonja Endres.


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