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GERMANY The 16 state governments determine hospital capacity, while ambulatory care capacity is subject to rules set by the Federal Joint Committee. Inpatient care is paid per admission through a system of diagnosis-related groups (DRGs) revised annually, currently based on around 1,200 DRG categories. DRGs also cover all physician costs. Other payment systems like pay-for-performance or bundled payments have yet to be implemented in hospitals. Mental health care: Acute psychiatric inpatient care is largely provided by psychiatric wards in general (acute) hospitals, while the number of hospitals providing care only for patients with psychiatric and/or neurological illness is low. In 2014, there were a total of 32,872 office-based psychiatrists, neurologists, and psychotherapists working in the ambulatory care sector (paid FFS) (Federal Association of SHI Physicians, 2015). Qualified GPs can provide basic psychosomatic services. Ambulatory psychiatrists are also coordinators of a set of SHIfinanced benefits called “sociotherapeutic care” (which requires referral by a GP), to encourage the chronically mentally ill to use necessary care and to avoid unnecessary hospitalizations. To further promote outpatient care for psychiatric patients (particularly in rural areas with a low density of psychiatrists in ambulatory care), hospitals can be authorized to offer treatment in outpatient psychiatric departments. Long-term care and social supports: LTCI is mandatory and usually provided by the same insurer as health insurance, and therefore comprises a similar public–private insurance mix. The contribution rate of 2.35 percent of gross salary is shared between employers and employees; people without children pay an additional 0.25 percent. The contribution rate will increase further by 0.2 percentage points in early 2017. Everybody with a physical or mental illness or disability (who has contributed for at least two years) can apply for benefits, which are: 1) dependent on an evaluation of individual care needs by the SHI Medical Review Board (leading either to a denial or to a grouping into currently one of three levels of care); and 2) limited to certain maximum amounts, depending on the level of care. Beneficiaries can choose between in-kind benefits and cash payments (around a quarter of LTCI expenditure goes to these cash payments). Both home care and institutional care are provided almost exclusively by private not-for-profit and for-profit providers. As benefits usually cover approximately 50 percent of institutional care costs only, people are advised to buy supplementary private LTCI. Since 2013, family caregivers get financial support through continuing payment of up to 50 percent of care payments if they provide care. Hospice care is partly covered by LTCI if the SHI Medical Review Board has evaluated a care level. Medical services or palliative care in a hospice are covered by SHI. The number of inpatient facilities in hospice care has grown significantly over the past 15 years, to 200 hospices and 250 palliative care wards nationwide in 2014 (German Hospice and Palliative Association, 2015). Legislation has recently been discussed to improve hospice and palliative care with the aim of guaranteeing care in underserved rural areas and linking long-term care facilities more strongly to ambulatory palliative and hospice care. What are the key entities for health system governance? The German health care system is notable for two essential characteristics: 1) the sharing of decision-making powers between states, federal government, and self-regulated organizations of payers and providers; and 2) the separation of SHI (including the social LTCI) and PHI (including the private LTCI). SHI and PHI (as well as the two long-term care insurance systems) use the same providers—that is, hospitals and physicians treat both statutorily and privately insured patients, unlike many other countries. Within the legal framework set by the Ministry of Health, the Federal Joint Committee has wide-ranging regulatory power to determine the services to be covered by sickness funds and to set quality measures for providers (see below). To the extent possible, coverage decisions are based on evidence from health technology assessments and comparative-effectiveness reviews. The Federal Joint Committee is supported by the Institute for Quality and Efficiency (IQWiG), a foundation legally charged with evaluating the costeffectiveness of drugs with added therapeutic benefits, and the newly formed Institute for Quality and Transparency (IQTiG). The Federal Joint Committee has had 13 voting members: five from the Federal Association of Sickness Funds, two each from the Federal Association of SHI Physicians and the German 72 The Commonwealth Fund

GERMANY Hospital Federation, one from the Federal Association of SHI Dentists, and three who are unaffiliated. Five patient representatives have an advisory role but no vote in the committee. Representatives of patient organizations have the right to participate in different decision-making bodies, e.g., the subcommittees of the Federal Joint Committee. The Federal Association of Sickness Funds works with the Federal Association of SHI Physicians and the German Hospital Federation to develop the SHI ambulatory care fee schedule and the DRG catalogue, which are then adopted by bilateral joint committees. What are the major strategies to ensure quality of care? Quality of care is addressed through a range of measures broadly defined by law, and in more detail by the Federal Joint Committee. Structural quality is assured by the requirement that providers have a quality Organization of the Health System in Germany Federal state (Ministry of Health) Statutory long-term care insurance Supervision and tax subsidies SHI-insured Contributions Länder (states) Supervision and (partial) financing Social Courts use use Statutory long-term care funds Inpatient and outpatient care Contracts Physicians and dentists in ambulatory care (and their associations) Sickness funds (and their associations) Contracts Federal Joint Committee Federal Chamber of Physicians Contracts Hospitals (and their associations) Public health agencies Long-term care insurance use Private health insurance Premium payment use Private health insurance Source: Adapted from R. Busse and M. Blümel, “Germany: Health System Review,” Health Systems in Transition, vol. 16, no. 2, 2014, p. 20. International Profiles of Health Care Systems, 2015 73

GERMANY<br />

Hospital Federation, one from the Federal Association of SHI Dentists, and three who are unaffiliated. Five<br />

patient representatives have an advisory role but no vote in the committee. Representatives of patient<br />

organizations have the right to participate in different decision-making bodies, e.g., the subcommittees of the<br />

Federal Joint Committee.<br />

The Federal Association of Sickness Funds works with the Federal Association of SHI Physicians and the German<br />

Hospital Federation to develop the SHI ambulatory care fee schedule and the DRG catalogue, which are then<br />

adopted by bilateral joint committees.<br />

What are the major strategies to ensure quality of care?<br />

Quality of care is addressed through a range of measures broadly defined by law, and in more detail by the<br />

Federal Joint Committee. Structural quality is assured by the requirement that providers have a quality<br />

Organization of the Health System in Germany<br />

Federal state (Ministry of Health)<br />

Statutory<br />

long-term<br />

care<br />

insurance<br />

Supervision and<br />

tax subsidies<br />

SHI-insured<br />

Contributions<br />

Länder (states)<br />

Supervision<br />

and (partial)<br />

financing<br />

Social Courts<br />

use<br />

use<br />

Statutory<br />

long-term<br />

care<br />

funds<br />

Inpatient and<br />

outpatient care<br />

Contracts<br />

Physicians and dentists<br />

in ambulatory care (and<br />

their associations)<br />

Sickness funds<br />

(and their<br />

associations)<br />

Contracts<br />

Federal<br />

Joint<br />

Committee<br />

Federal<br />

Chamber of<br />

Physicians<br />

Contracts<br />

Hospitals<br />

(and their associations)<br />

Public health agencies<br />

Long-term<br />

care<br />

insurance<br />

use<br />

Private health<br />

insurance<br />

Premium<br />

payment<br />

use<br />

Private health<br />

insurance<br />

Source: Adapted from R. Busse and M. Blümel, “Germany: Health System Review,” Health Systems in Transition, vol. 16, no. 2, 2014, p. 20.<br />

International Profiles of Health Care Systems, 2015 73

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