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employee, starting next year.293 In addition,

drugs. Copayments were imposed for the first

time, such that Germans now pay €10 per

general tax revenues finance capital costs for

€

quarter to see a general practitioner, €10 per

acute care hospitals and many rehabilitative

€

day of hospital stay, €€10 per prescription, and

services, especially for retirees.

for certain specialty services.299 The highest

Benefits are extensive, covering physi-

cians, hospital and chronic care, diagnostic

copayments are 10 percent for prescription

tests, preventive care, prescription drugs, and

drugs. Overall, Germans pay out of pocket for

part of dental care. In addition to the medical

about 13 percent of total health care spending,

only slightly less than Americans.300 Prelim-

benefits, sickness funds provide sick pay to

those who cannot work due to illness, rang-

inary evidence suggests that the introduction

ing from 70 to 90 percent of the patient's last

of cost sharing has slightly reduced utilization

gross salary, for up to 78 weeks.294

and spending.301

The central government and state govern-

In 2006, Chancellor Angela Merkel pro-

ments split the regulation of the health care

posed a sweeping set of health care reforms

system. The central government establishes

that included creating a centralized health

the national global budget for health care

fund, shifting financing in part from payroll

spending, defines any new medical procedures

taxes to general revenues, trimming benefits,

to be included in benefit packages, and sets

imposing greater cost sharing, and making the

reimbursement rates for physicians. Some of

system more transparent. She was forced to

this is accomplished through legislation, while

abandon the package in the face of public and

political opposition.302

the rest is handled through negotiations

between the National Association of Sickness

The degree of health care rationing in

Funds and the National Association of

Germany is the subject of considerable debate.

Physicians. At the state level, state associations

Unlike many OECD countries, the German

of sickness funds and physicians negotiate

government does not compile data on waiting

lists.303 One frequently cited study suggests

overall health budgets, reimbursement con-

tracts for physicians, procedures for monitor-

that Germans are no more likely than Ameri-

ing physicians, and reference standards for

cans to wait more than four weeks to see a spe-

prescription drugs.295 The bargaining power

cialist.304 The WHO says, "Waiting lists and

in these negotiations clearly lies with the sick-

explicit rationing decisions are virtually

unknown."305

ness funds backed by the government, allow-

ing them to effectively impose fee schedules

However, at least one study concludes that

and other restrictions on providers. The pur-

rationing is occurring for the elderly and those

chasing power of a German physician's wages

with terminal illness, and concludes that "the

is now about 20 percent that of a U.S. physi-

question remains as to whether lives at

cian.296 This has led to physician strikes as

advanced ages could be saved if age rationing

recently as 2005.297

were discontinued and maximum medical

Although

treatment were to be applied to everyone, irre-

Although Germany spends less on health

spective of their age."306 In addition, a survey of

care than the United States, both as a percent-

Germany spends

age of GDP and per capita, expenditures have

German hospitals reported that "waiting times

less on health

been rising at an alarming rate in recent years.

were prolonged" due to both a lack of capacity

care than the

Friedrich Breyer, an economist from Konstanz

and hospital target budgets that make the

University, estimates that health care spending

treatment of sickness fund patients with seri-

United States,

ous conditions financially unattractive.307

could reach 30 percent of GDP by 2020 unless

expenditures have

significant changes are made.298

Also, Germans have less access to modern

been rising at an

medical technology than Americans. The

The German government has responded by

United States has four times as many MRI

beginning to cut back on benefits. In 2004,

alarming rate in

units per million people and twice as many

sickness funds stopped covering eyeglasses,

recent years.

CT scanners.308 The situation would undoubt-

lifestyle medications, and all over-the-counter

30