Issues in the German and U.S. Health Care Systems

The United States faces severe challenges in access to health care, cost effectiveness, equity, and to a lesser extent in coordinating care. Meanwhile, the German system is confronted by problems in coordinating care and controlling costs.

United States

Coordinating Care

U.S. health care providers are heavily divided by state and local regulations, specialization, and ownership, exacerbating the difficulty of a common information-sharing system.

The United States’ heavily fragmented, privatized system explains both its success in applying preventive and patient-centered care and its failure in managing long-term care and coordination efforts.

• Because health care providers operate with a large degree of independence and receive payment directly from their patients’ insurers, they have significant incentives to provide excellent up-front care and build relationships with patients in their specific area.

• Because of their independence and under-utilization of shared information systems, providers face difficulties in coordinating care between facilities and institutions, especially across fields.

Access

The United States lacks a universal health system, resulting in significant access problems for the uninsured and under-insured.

Specialized and primary services are very quickly accessible for insured patients

Efficiency

Highest health expenditure per capita in the OECD ($7,290 or 17.4% of per capita GDP, 2009).

Poor performance on administrative costs, use of information technology, re-hospitalization, and duplicative medical testing.

• Because hospitals are required to treat uninsured patients in life-threatening condition, they must charge insurers more to cover costs of uninsured patients.

Equity

46 million Americans (about 15 percent) live without health insurance.

Low-income patients, even when insured, are acutely aware of the cost of health care, and are more likely to forgo health services due to cost.

Germany

Coordinating Care

Like in the U.S. system, providers are divided and specialized without a common information-sharing system, leading to problems in gathering and maintaining patient records.

Access

Because of the universal nature of Germany’s health insurance system, greater demand exists for health care professionals, resulting in longer average waiting periods for primary care physicians than in the United States. Remarkably, waiting periods for specialized care are not significantly longer.

Efficiency

4^th highest health expenditure per capita in the OECD ($4,218 or 11.6% of per capita GDP).

Demographic changes: as Germany’s population ages, the increased elderly proportion of the population will drive up demand and cost for health care services, leaving little foreseeable prospect for easy cost limitation methods.

Equity

Because Germany’s health care system is universal, it does not share the U.S.’ insured/uninsured divide.

Some purchases are not always fully covered under the legally mandated health insurance, Gesetzliche Krankenversicherung (GKV). In order to cover these costs, Germans can buy supplemental or complementary private insurance, but must pay for these themselves. This creates a small degree of inequity as individuals with only GKV, who must pay for additional costs out of pocket, may not be as well off as those with GKV and additional private insurance.

Dual System: Civil servants, the self-employed, and individuals earning more than approximately €50,000 per year may opt out of the GKV system and purchase private health insurance, which covers approximately 10 percent of the population.

Private health insurers pay higher rates to outpatient care providers, giving these providers an incentive to favor the privately insured. This inequity generally results in shorter wait times for the privately insured for outpatient care providers.