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COVID-19: German health policy in crisis

Summary: The German health care system will be fundamentally changed in the forthcoming years according to the will of leading politicians. Drivers of change are the nursing shortage and salaries, the relationship between the state and the economy in the systemically relevant services of general interest, digitalization, and considerable financing problems. This will continue to present politicians and public affairs managers with major challenges in the next legislative period.

Before the COVID-19 pandemic, Federal Health Minister Jens Spahn was considered the most effective minister with the most legislative initiatives and reform projects in the Bundestag. This will not change quickly.

It is not just that the current crisis that is putting pressure on the health system is the most important challenge on the political agenda. And that will not change so quickly either. On the contrary, the pandemic will determine health policy in the next legislative period.

The federal and state governments want and need to set new priorities and implement structural reforms. Four developments, in particular, are creating pressure for change:

1. Personnel and salary developments in the nursing division: it is time to deliver

No other problem determines health policy action like the shortage of skilled workers in the nursing professions, which has existed for many years. While intensive care bed capacities can be increased at a short notice and the production of ventilators can also be ramped up, this is only possible to a limited and temporary extent in personnel planning. Experts believe one of the main reasons is the below-average remuneration of the 5.7 million employees in the health care system.

Following the bonus payments for hospital staff that has already been agreed, further structural adjustments will have to be made in the next round of collective bargaining. The public pressure, not just with the applause every evening, is great. There is also a cross-party consensus on this. Last but not least, the North Rhine-Westphalian Minister-President and candidate for the CDU chairmanship, Armin Laschet, is demanding a significant increase in salaries. A demand that many Social Democrats, such as the Federal Labour Minister Hubertus Heil, have also joined. But it’s not just hospitals that will be affected by this. It will also affect the many employees in nursing and retirement homes and the mobile health sector. In addition to remuneration and working conditions, staff recruitment will also remain a constant issue in politics.

2. Readjustment of the relationship between the state and industry in health policy: public services are being redefined

In the pandemic, the structures of the health care system will be reassessed. This concerns both the relationship between the federal and the state governments and has already led to initial adjustments in the Infection Protection Act, as well as the effectiveness of state institutions. Procurement, stockpiling and emergency reserves have moved into the focus as government tasks. However, the ownership structures of the hospitals and with them the financing are also being reviewed. It remains to be seen how great the willingness is to finance hospital losses. This is a particular problem for municipal facilities, as many municipalities are not in a position to sustain this in the long term.

The role of the health authorities is already being rethought and redesigned in the ongoing process. For example, Bavaria is hiring around 3000 new employees in this area. Minister-President Markus Söder has also already announced a fundamental debate on the future of healthcare.

3. Digitalization: shifting the discourse of action

The digitization of the health care system, which has been discussed for decades, is finally starting to move. Even before the COVID-19 crisis, the Federal Ministry of Health had already tabled important motions for this through the Bundestag. Now the urgency has increased significantly now that the shortcomings have come to light. From the tracing app to the data collection of central resources, such as intensive care beds, to the patient record – new and innovative solutions are urgently needed in the pandemic. Although data protection concerns and other problems will not be eliminated by a new need for protection, their blocking function will be put into perspective. Standing still is no longer an option.

4. Financial needs: no reorganization without fresh money

The planned COVID-19 special premium of 1,500 euros for geriatric nurses alone will cost around one billion euros. The health insurance companies have already announced resistance to financing through nursing care insurance. The protective shield for hospitals will be covered by tax revenues, but will not be sufficient to compensate for the loss of income. The salary demands of the German Professional Association for Nursing Professions are currently at 4,000 euros as a starting salary – of course, refinanced by the health insurance funds. Also, personnel increases of the health authorities, the required changes to the nursing care ratio for intensive care beds, an improved supply of protective materials in all areas of health care, new crisis-proof supply chains with production at higher prices in Germany, and last but not least, urgently needed new drugs and hopefully soon to be available vaccines for a comprehensive national vaccination campaign lasting several years will lead to an increasing need for financing.

These additional costs will be offset by declining revenues. The economic development is already leading to short-time work and job cuts. As a result, social insurance revenues are falling. The reduction of capital reserves of statutory health insurances (GKV) amounting to about 20 billion euros will thus accelerate uncontrollably this year. Fresh money will also be needed.
Where can we find it? A revival of the discussion about the role of private health insurance companies (PKV) is conceivable. The cost of drug supply and thus the costs and profits of the pharmaceutical industry will also be put back on the table.

The COVID-19 crisis will lead to an advance in the healthcare system. The agreement of the political positions of conservative, social democratic, and green politicians on the role of the state is likely to be greater than ever before.

Health policymakers and public affairs managers will have to consider how they can hold their own in the coming disputes.

By Martin Becker