1. Risk adjustment in GermanyDr. Dirk Gpffarth, German Federal Insurance AgencyRisk Adjustment Conference 2011London, 29 June 20116. Juli 2011 Bundesversicherungsamt Friedrich-Ebert-Allee 38 53113 Bonn1

2. I.Health Care System in Germany2 3. Statutory Health Insurance in Germany: Coverage 70 million covered (out of a population of 80million) coverage mandatory for employees up to anincome threshold of 4.125 per month coverage voluntary for high-incomeemployees, self-employed and civil servantsif they were covered by the SHI beforehand otherwise these groups can opt for privatehealth insurance (risk assessment) special rules for farmers3 4. Statutory Health Insurance in Germany:Benefits 95 % of benefits mandated broad coverage of all medically necessarybenefits, including office-based physicianstreatment (including specialists), dentalcare, prescription drugs, hospital treatment,sickness payments, (within limits)physiotherapy etc. co-payments: generally 10 % (minimum 5 ,maximum 10 ), for office-based physicians10 Euro every quarter provision otherwise free at point of service 4 5. Statutory Health Insurance in Germany:Carriers currently approx. 147 sickness funds 1991: more than 1.200 sickness funds 2008: 206 sickness funds Organisation: incorporated bodies of publiclaw with self-administration Different kinds of funds: local funds,company funds, guild funds, substitute funds,special systems for miners, seamen, farmers since 1996: free choice of sickness fund since 2007: merger of funds of differentkinds possible5 6. Role of Central Health Fundin Financing Health Care Tax Subsidies Contributions 15.5 bn 159.0 bnCentral HealthFund Additional Premia 0.7 bn Risk-adjusted paymentsSickness FundsPhysiciansHospitalsDrugsOther 28.5 bn 57.4 bn 30.0 bn 45.2 bn 2010 figures6 7. Some Facts on theGerman Federal Insurance Agency (BVA) Supervisory authority for federal socialinsurance institutions (sickness funds,pension funds, employers liability insurance,long term care insurance) Audit office for federal sickness funds Administrative tasks: Central Health Fund,Risk adjustment, licensing Disease-Management-Programs 540 staff, head office in Bonn 7 8. II.Risk Adjustment in Germany 8 9. Evolvement of Risk Adjustment in GermanyAge Age AgeGenderGenderGenderDisability to Disability to Disability to workworkworkEnrolement Morbidity in DiseaseManagement Risk Pool1994200320099 10. Reasons for Introducing Risk Adjustmentin 1994 Before 1996, most insured were allocated toa fund, only white-collar workers could opt forsubstitute fund Expenditure for pensioners was pooledPooling led to low incentives for cost controlRestriction of choice became politicallyuntenable, large differences in contributionratesLegal challenges 10 11. Reasons for Reforming Risk Adjustment in 2001 Functionality of competition Sickness funds tried to attract young and healthy switchers Incentives for providing care for chronically illShort term: Disease Management Programsand Risk PoolLong term: Introduction of morbidity-basedrisk adjustment by 2007 Later political compromise: Postponement to 2009 and restriction to 80 disease states 11 12. Overview over the risk adjustment system implemented in Germany approx. 4.000 diagnosesclassification model Risk adjustors plausibility checks definition ofeligibility 80 disease states Inpatientdiseasescriteria 40 Age-Sex-Groups disease filterandoutpatient severity validation 6 groups for disability-diagnosesofto-work-status chronicICD-10-GMdiagnoses cost-intensive eg. with 128 hierarchical drug data morbidity groups cost threshold Pharmaceutical agents ATC-Codes12 13. Eligibility criteria:Not every diagnosis leads to a payment All outpatient diagnoses have to be validatedby a second diagnoses of the same diseasein a different quarter of the year DxGroups implying a necessary in-patienttreatment (eg. acute myocardial infarct)cannot be triggered by outpatient diagnosis DxGroups with necessary drug treatment (eg.Diabetes mellitus Typ 1) have to be validatedby use of corresponding pharmaceuticalagents 13 14. Calculation of monthly paymentsAge-Gender-Disability-to- Hierarchical Morbidity GroupsGroups work-Groups25 HierarchiesFemale0y1661-5 y-131Diabetes Ophthalmic ... ... Female Lump 40-44y -120