Health insurance funds achieved a surplus of 1.4 billion euros.
22.12.2009 15:36
New figures for the 3rd quarter of 2009
The statutory health insurance funds achieved a surplus of approximately €1.4 billion in the first nine months of 2009. Revenues from the health fund amounted to €127.8 billion, while expenditures totaled €126.4 billion. Compared to the financial results of the first half of the year, which showed a surplus of €1.2 billion, this represents a further increase of around €0.2 billion. This further stabilized the financial situation of the health insurance funds throughout 2009.
In the upcoming fourth quarter, expenditures are typically higher compared to the average of the first three quarters. Furthermore, the final months of the year will see expenditures of approximately €600 million for vaccinations against the new influenza virus. Therefore, a further increase in the surplus is not expected in the fourth quarter; instead, the total annual surplus is projected to decrease to less than €1 billion.
Nevertheless, most health insurance funds, starting from total financial reserves of €4.9 billion at the end of 2008, will further improve their financial position for 2010 this year. However, both the surplus development in 2009 and the level of financial reserves varied considerably among the individual health insurance funds. Health insurance funds are legally required to maintain a minimum financial reserve of approximately €3.5 billion.
Income and expenditure of the health fund
The Health Fund paid out a total of approximately €124.5 billion to the health insurance funds for the months of January through September. These payments were covered by corresponding revenues from the Health Fund, including contributions and federal subsidies. During the first nine months of the year, the Fund made use of the legally provided option to advance monthly federal subsidy payments totaling approximately €1.55 billion. Looking at the entire year of 2009, the statutory health insurance (GKV) forecasting panel currently expects the Fund's contribution revenues to be approximately €2.3 billion lower than projected in the initial 2009 estimate in autumn 2008, due to the economic crisis.
Perspective 2010
The panel of experts will revisit the projected financial developments for 2009 and 2010 on December 9th, taking into account key macroeconomic data and the latest quarterly results on expenditure trends. At their last meeting, the experts anticipated a deficit of approximately €7.5 billion for 2010 due to unfavorable contribution revenues coupled with continued rising expenditures. This was the starting point for the statutory health insurance system at the beginning of the new legislative period in 2010.
The new federal government quickly drew the necessary conclusions from this. The Federal Minister of Health and the Federal Minister of Finance therefore agreed to compensate for the crisis-related revenue shortfalls in 2010 with an additional federal subsidy of €3.9 billion. This subsidy supplements the federal subsidy already provided by law for the health insurance funds' societal tasks, which will increase from €7.2 billion in 2009 to €11.8 billion in 2010. With this additional funding to cover the crisis-related revenue shortfalls, the health insurance funds will thus have a total of €15.7 billion in tax revenue at their disposal in 2010. Against this backdrop, the previously anticipated deficit for 2010 is expected to more than halve.
Following the federal government's decision to increase federal subsidies, many health insurance funds have already announced their intention not to levy additional contributions next year either. Often, the funds' financial reserves, which exceed the legally required minimum reserve, can also be used to avoid additional contributions. More efficient service units can also be created through suitable mergers. While there were 215 funds at the end of 2008, this number has since fallen to 184. Further mergers have already been decided upon or announced, and in many cases, merger negotiations are underway.
Whether individual health insurance funds will require limited additional contributions next year will become clear in the coming weeks, once these funds have made their own decisions with the approval of the respective supervisory authorities. However, the increased federal subsidy will generally prevent additional contributions exceeding the legally stipulated de minimis threshold of €8 per month. Health insurance funds are required to fully utilize existing efficiency reserves across all expenditure areas to avoid unnecessary spending.
Spending growth so far is below forecasts for the entire year 2009.
Health insurance expenditures rose by 6.6 percent per insured person in the first three quarters of 2009. This figure remains below the previous expenditure forecast of 7.0 percent, which the expert panel had projected for the entire year of 2009. The increase is primarily driven by changes in the major benefit categories, resulting from necessary improvements in the financial situation of physicians and hospitals, as well as continued significant increases in pharmaceutical expenditures.
Development in individual performance areas
The following spending trends are emerging in the major service areas:
The 8.7% increase per insured person in expenditures for outpatient medical treatment demonstrates that the fee situation for physicians improved considerably in 2009 following the fee reform. Expenditures for preventive medical examinations, which saw a 21.5% increase—linked to improved services and thus a desired outcome of health policy—further boosted physicians' fees. Overall, the share of all statutory health insurance expenditures that benefit contracted physicians (including the co-payment paid by insured individuals) thus amounts to approximately 19%.
The increase in expenditure on inpatient care in the first to third quarters of 2009 was 6.4% per insured person and largely reflects the additional funds of approximately €3.5 billion that are available to hospitals this year to improve their financial and working conditions.
The increase in pharmaceutical expenditures (excluding vaccination costs) was 5.2% per insured person. Expenditures for vaccinations, following the high increases of 2007 and 2008, have decreased by approximately 3.4%. This figure does not yet include expenditures by health insurance funds for vaccinations against the novel influenza virus. Sickness benefit expenditures, with an increase of 9.7% – completely atypical compared to previous economic crises – are significantly higher than the previous year's expenditures. A careful analysis will be necessary to determine the extent to which the rise in certain long-term illnesses (including mental illnesses) is a contributing factor.
After a prolonged period of stability in previous years, the net administrative costs of health insurance funds have increased by 7.4% per insured person, although the trends have varied among the different types of funds. In addition to increased personnel costs, declining reimbursements also play a role. For example, with the introduction of the Health Fund, the costs of disease management programs (DMPs) were removed from the reimbursement volume for administrative costs. Health insurance funds have received separate allocations for this purpose since the beginning of 2009. This change automatically leads to higher net administrative costs. With a total volume of approximately €3.7 billion across all benefit areas, co-payments by insured persons, including the practice fee, are expected to remain at a similar level to the previous year.