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Special thanks to Daniel_Lobo for permission to use this photo.

Today, as the first in an ongoing series of updates on what’s new in international health care, I want to take a look at recent reforms in Germany. As a whole, we Americans pay precious little attention to what’s going on in other countries unless the news involves war or David Beckham. I’m hoping to buck this trend a little.

The big story in German health care is Chancellor Andrea Merkel’s late 2006 reform that resulted in series of changes that, for the most part, were implemented in April of last year. Below, a look at these reforms; but first a little political background: Merkel heads up a “grand coalition” government, i.e. one where the largest political parties govern in collaboration due to inconclusive election results (a relatively common occurrence in parliamentary systems). In other words, social democrats and conservatives are in a constant tug-of-war. The new plan reflects this fact, juggling solidarity and competition in equal parts. And while this might sound like a good balance, virtually no one is satisfied with the compromise.

On to the big changes:

Mandatory Health Insurance: Many folks think that European health care means, by definition, universal public coverage. Not so. Germany has a public/private system, and before the April 2007 reform, public coverage was only compulsory for those within a certain income range (roughly speaking, working and middle class citizens). Higher-income and self-employed Germans, along with public servants, could opt-out of SHI by purchasing private insurance. They could also forgo insurance all together.

Due to this set-up, until recently some 200,000 Germans were uninsured—about 0.2 percent of the population. As of April ‘07, all Germans must purchase health insurance. In the past, private insurers (who traditionally offer plans with many bells and whistles) had the right to refuse coverage for high-risk individuals. Now, they must take all comers. In this way, the new German plan is like Hillary Clinton’s proposal for health care reform: insurers can no longer shun the sick but everyone must sign up—citizens cannot wait  until they are sick to enroll. (more…)

Thanks to jclpat for permission to use this photo.

Today’s New York Times article on outsourcing by the State Department should be no surprise. Outsourcing, business process outsourcing, smart sourcing - whatever you want to call it, contracting out services is a business mainstay and fundamental. 

Healthcare is no different, though of course few people like to talk about. Privacy concerns abound. The reality is there’s not much privacy to begin with and outsourcing will continue to grow.

In healthcare, offshore outsourcing is commonly used for claims processing, customer service, medical transcription and billing services. However, as certain clinical areas experience talent shortages amidst rising demand, healthcare providers are looking for more outsourcing solutions.

According to research firm IDC, nearly $322 million was spent on offshore healthcare services in 2005. They project a 79% increase to $575 million in 2008.

According to public data, among those managed care organizations that do offshore outsourcing are Aetna, BCBS Michigan, BC of N. PA, Cigna, Coventry, Horizon BCBS, Humana, Kaiser Permanente, Regence Group, United Health, WellCare, Wellpoint/Anthem and others.

According to U.S. Government Accountability Office (GAO) reports, 19 percent of Medicare Advantage contractors do offshore data transfers as part of outsourcing. Four percent of Medicare FFS contractors do so, and 2 percent of state Medicaid agency contractor vendors do so.

Shawn Whalen
Contributing Blogger
Ashworth University

*Shawn Whalen is the Senior Vice President of Schwartz Communications, where he manages a variety of clients in healthcare IT and communications.  Mr. Whalen is nationally recognized as one of the leading experts in the healthcare technology industry.  We would like to thank Shawn Whalen for giving us the opportunity to share his vast knowledge and experience with the AU student community.  Visit Shawn’s Schwartz Healthcare IT Blog for additional insights.  Thanks Shawn!