Needs for further improvement: risk adjustment in the German health insurance system

The German risk adjustment mechanism is used only within the public system. It was introduced in two steps, 1994 and 1995. Because of the income-related contribution, which the insured pay directly to their sickness fund, income of the insured is equalized by the mechanism and causes the biggest par...

Full description

Saved in:
Bibliographic Details
Published in:Health policy (Amsterdam) 2003-07, Vol.65 (1), p.21-35
Main Authors: Buchner, Florian, Wasem, Jürgen
Format: Article
Language:English
Subjects:
Actuarial Analysis
Competition
Disability Evaluation
Europe
Germany
Germany - epidemiology
Health
Health administration
Health Expenditures - statistics & numerical data
Health insurance
Health policy
Health Services Needs and Demand
Humans
Income
Insurance Pools - economics
Insurance Selection Bias
Managed Competition - economics
Models, Econometric
Morbidity
National Health Programs - economics
National Health Programs - organization & administration
Policy studies
Regional studies
Risk
Risk adjustment
Risk Adjustment - methods
Social contributions
Social health insurance
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:The German risk adjustment mechanism is used only within the public system. It was introduced in two steps, 1994 and 1995. Because of the income-related contribution, which the insured pay directly to their sickness fund, income of the insured is equalized by the mechanism and causes the biggest part of the payments among the sickness funds. On the expenditure side age, gender, disability and entitlement for sickness allowances are used as risk adjusters. The mechanism is retrospective, calculating average costs for each of the 670 risk cells defined by the risk adjusters and using these “standardized expenditures” as a base for the payment a single sickness fund gets because of its risk structure. There do still exist incentives for risk selection. The experience shows that mostly the young and healthy are willing to change sickness funds motivated by lower contribution rates. This can be used and is used for self-selection. Another cause of risk selection is regional differences. The central suggestion of an expertise on behalf of the German Ministry of Health on experiences and improvement proposals is the change to a direct modeling of morbidity.
ISSN:0168-8510
1872-6054
DOI:10.1016/S0168-8510(02)00114-8