JANUARY

GERMANY
There were 42 substitutive PHI companies in June 2015 (of which 24 were for-profit) covering the two groups
exempt from SHI (civil servants, whose health care costs are partly refunded by their employer, and the selfemployed)
and those who have chosen to opt out of SHI. All of the PHI-insured pay a risk-related premium, with
separate premiums for dependents; risk is assessed only upon entry, and contracts are based on lifetime
underwriting. Government regulates PHI to ensure that the insured do not face large premium increases as they
age and are not overburdened by premiums if their income decreases.
PHI also plays a mixed complementary and supplementary role, covering minor benefits not covered by SHI,
access to better amenities, and some copayments (e.g., for dental care). The federal government determines
provider fees in substitutive, complementary, and supplementary PHI through a specific fee schedule. There are
no government subsidies for complementary and supplementary PHI. In 2013, all forms of PHI accounted for
9.2 percent of total health expenditure (Federal Statistical Office, 2015).
What is covered?
Services: SHI covers preventive services, inpatient and outpatient hospital care, physician services, mental
health care, dental care, optometry, physical therapy, prescription drugs, medical aids, rehabilitation, hospice
and palliative care, and sick leave compensation. Home care is covered by long-term care insurance (LTCI). SHI
preventive services include regular dental checkups, child checkups, basic immunizations, checkups for chronic
diseases, and cancer screening at certain ages. All prescription drugs are covered unless explicitly excluded by
law (mainly so-called lifestyle drugs) or disallowed following evaluation. While the broader framework of the
benefits package is legally defined, specifics are decided upon by the Federal Joint Committee (see below).
Long-term care services are covered separately by the LTCI scheme (see below).
Cost-sharing and out-of-pocket spending: Out-of-pocket (OOP) spending accounted for 13.6 percent of total
health spending in 2013, mostly on nursing homes, pharmaceuticals, and medical aids (Federal Statistical
Office, 2015).
Copayments include EUR5.00 (USD6.40) to EUR10.00 (USD12.70) per outpatient prescription, EUR10.00 per
inpatient day for hospital and rehabilitation stays (for the first 28 days per year), and EUR5.00 to EUR10.00 for
prescribed medical devices. Sickness funds offer selectable tariffs with a range of deductibles and no-claims
bonuses. Preventive services do not count toward the deductible. SHI-contracted physicians are not allowed
to charge above the fee schedule for services in the SHI benefit catalogue. However, a list of “individual health
services” outside the comprehensive range of SHI coverage may be offered to patients paying OOP.
Safety nets: Children under 18 years of age are exempt from cost-sharing. For adults, there is an annual cap
on cost-sharing equal to 2 percent of household income; part of a household’s income is excluded from this
calculation for additional family members. About 0.4 million SHI insureds exceeded the 2 percent cap in 2013
and were exempted from further cost-sharing. The cap is lowered to 1 percent of annual gross income for
qualifying chronically ill people; to qualify, those people have to demonstrate that they attended recommended
counseling or screening procedures prior to becoming ill. Nearly 6.5 million people, or around 9 percent of all
the SHI-insured, benefited from this regulation in 2013 (Federal Statistical Office, 2015). Unemployed people
contribute to SHI in proportion to their unemployment entitlements. For the long-term unemployed,
government contributes on their behalf.
How is the delivery system organized and financed?
Physicians: General practitioners (GPs) and specialists in ambulatory care who get reimbursed by SHI are by law
mandatory members of regional associations that negotiate contracts with sickness funds. Regional associations
of SHI-accredited physicians are responsible for coordinating care requirements within their region, and act
as financial intermediaries to the sickness funds and the physicians in ambulatory care. However, ambulatory
physicians typically work in their own private practices—around 60 percent in solo practice and 25 percent
in dual practices. Most physicians employ doctors’ assistants, while other nonphysicians (e.g., physiotherapists)
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The Commonwealth Fund