US Health Policy and Health Economics, a big Topic for Realtors!

Angie Adams SRES REALTOR Broker — Thu, 08 May 2008 17:05:00 GMT

I immigrated to the United States in 1989 from Germany, and even then it was unheard of to me that there were people here without health insurance or care. A short time after living here, my then husband’s uncle got a divorce from his dying wife at the hospital bed, so he would not get stuck with the medical bills. I was shocked!

I am self-employed and my health insurance is going up the roof. I am paying now $300 a month with a $5000 deductible. And that does not cover dental or vision! I feel like I am walking on eggs, hoping not to become ill.

Although the USA and Germany have different approaches in health policy, I am convinced that each of us can learn and benefit from each other's solutions.

In the USA and Germany, the health care system is a vital—and highly sensitive—sector of the economy. In Germany, roughly 290 billion dollars are spent every year on health services in the broadest sense; about 175 billion dollars out of this total are accounted for by the statutory health care system.

Approximately 70 million out of a total population of 82 million people are covered by the social health insurance system, to which they pay a percentage of their wages and salaries as contributions. At present, employees pay an average 7.5 per cent of their salary for health insurance coverage. Their employers contribute 6.6 per cent but will have to continue payment of wages for 6 weeks in case of illness.

Germany’s statuary health insurance is a family insurance, meaning that children and non employed spouses are co-insured free of charge. The principle is that the rich pay for the poor, the young for the old, and the healthy for the sick. Blue and white-collar workers who earn less than 4,700 dollars a month, are insured on a mandatory basis, as are persons who are unemployed, pensioners, students, disabled persons, poor and homeless people. They are all covered in the statutory health insurance system according to the same provisions and enjoying equal access to health benefits and services.

Germany’s funding of statutory health care and the access to it is based on the concept of solidarity. This means that contributions are made according to ability to pay and people receive benefits according to their health care needs.

Individuals with an income above 4,700 dollars per month or those who are self-employed, can either stay in the social system on a voluntary basis or opt out and purchase private health insurance. Some 10 percent of the population is privately insured and only a small number is covered by special state programs (for example federal policemen or soldiers).

Members of a private health insurance pay premiums that reflect their health risk. Bad risks are turned down by private health insurers. However, in Germany, only a relatively small number of persons—about 300,000—are uninsured. These are mostly people who have been unable to pay their contributions due to financial difficulties.

Germany worries about the fact that their number has been growing. Therefore the new Federal Government has decided that, in the future, no one may lose their insurance coverage. Persons who lost their coverage because they were unable to pay their private health insurance premiums, are to be given a right to reinstatement without a new risk assessment. I consider this as an extremely important step towards the system which I favor—one of mandatory insurance for everyone living in Germany.

Insurances in Germany offer a comprehensive package of services. They cover, for instance, outpatient and hospital treatment, all necessary medication, dental treatment, denture, as well as rehabilitation. In other words, they cover whatever is necessary.

The health care sector in Germany supplies safe and well-paid jobs for more than four million people. And both in your country and mine, the health care sector accounts for far more than ten per cent of the gross domestic product. Only Switzerland and France can compete with us here on a per capita basis. While this figure is an indicator of material wealth, there is also a downside to it.

Rising expenditure leads to higher contributions and thus to economic difficulties—in the US as well as in Germany.

Rising contribution rates lead to reduced real earnings, they raise the non-wage labor costs, weaken the investment capacity of companies and impair their competitive capacity as compared to abroad.

Back home in Germany however, it is not only the employers who view rising health insurance expenses as an economic threat. Employees themselves are not happy either when contribution rates or premiums go up. After all, these increases eat up their disposable net income and force people to cut down on other purchases.

This and the advancements in medicine, pharmacology and medical technology along with demographic, social, and economic change will increase pressure for further rationalization measures on Germany’s health care system. Services provided under statutory health insurance therefore need permanent monitoring as to their medical necessity, quality and efficiency.

Some excerpts are taken from the German Health Minister Ulla Schmitdt.

Also see http://www.npr.org/templates/story/story.php?storyId=91971406&sc=emaf and see what some Americans living in Germany saying about this healthcare system.

Growing health insurance crisis for Realtors

Angie Adams SRES REALTOR Broker — Sun, 18 Feb 2007 13:34:00 GMT

Because of my move from Charlotte NC to the bordering Tega Cay SC I would need to shop for new health insurance. My rate with Blue Cross Blue Shield would increase $100 a month, just by moving. I would need to go through the whole application process again. I called another insurance company yesterday and did a telephone application, which felt more like an interrogation than an interview. I am a healthy person, had an ear infection last year and they made me go in great detail about it. It felt very demeaning. I hope our Realtor Association find a solution fast to this growing health insurance crisis. The only way to manage a payment is having a $2500 or $5000 deductible. But what happens if you get sick, even if they say you can never be canceled, I know for a fact they raise the rates until you have any options left and you have to drop them. It does not seem fair.

More here: http://www.realtor.org/press_room/news_releases/2007/realtors_other_small_business_people.html

What are your opinions?

Angie