Why the USA Can't Copy the German Healthcare System

The United States often looks at other countries for health policy inspiration. Germany's healthcare system is one such model that is frequently cited. However, the effectiveness of the German system may not translate to the US due to significant differences in health challenges and economic structures.

Addressing the Epidemic of Morbid Obesity

One of the primary reasons the American healthcare system cannot fully adopt the German model is the high prevalence of morbid obesity. Unlike Germany, the US has an epidemic of obesity that dramatically impacts healthcare needs. Programs like 'My 600 Pound Life' illustrate the unique challenges the US faces in terms of public health. A universal healthcare model that originated in a country where people generally do not face these extreme medical conditions might not be as effective.

Cost and Efficiency in Healthcare

The German healthcare system operates under a statutory health insurance model. Individuals earning below a certain threshold (roughly $80,000 USD) are required to enroll in sickness funds, which are nonprofit organizations. Those earning above this threshold can opt for private insurance, but private insurers are heavily regulated to ensure affordability and fairness.

The system is funded by a combination of payroll deductions (15%) and individual payments to the chosen sickness fund (1% of wages). Private insurers in Germany are also tightly regulated, limiting their ability to profit excessively and ensuring that coverage remains accessible and affordable.

In Germany, health insurance covers dental and optical services. However, not all services are completely covered, and on average, 14% of total healthcare spending in Germany remains out-of-pocket. In contrast, the US spends about 10% out-of-pocket, a gap that can be attributed to the more comprehensive and all-encompassing nature of the German system.

Healthcare Spending and the Role of Profit

Germany spends approximately 11.5% of its GDP on healthcare, compared to about 17.5% in the US. This reflects a significant disparity in per capita healthcare spending between the two countries, with the US spending nearly double what Germany does per person.

The primary reason for the higher spending in the US is the profit-driven nature of our healthcare system. In the US, health care companies are allowed to make significant profits, whereas in Germany, the focus is on the public good. This includes measures such as preventing private equity funds from de-staffing hospitals and nursing homes to increase profitability.

In the US, private health insurers are free to raise premiums, restrict coverage, and pass these costs on to customers. This leads to a model that prioritizes profitability over the health of the population. A typical American spends around $11,000 per year on healthcare, while a German spends around $6,500, indicating that much of the higher cost in the US is attributed to profit rather than health outcomes.

The Structural Differences in Healthcare Systems

The biggest challenge to adopting the German system in the US is the need for a fundamental restructuring of the government. The US healthcare system is organized to prioritize the interests of capital over those of the citizenry. This includes a lack of regulation on private equity and health insurers, which can lead to practices that are detrimental to public health and increase healthcare costs.

To transition to a system like Germany’s, the US would need a dedicated plan to place the interests of the population ahead of corporate profits. This would involve significant changes to the political and economic structures that currently benefit from the current healthcare model.

Conclusion

The US cannot simply copy the German healthcare system without addressing the unique health challenges and economic structures that make it unsuitable. The profit-driven nature of American healthcare must be reformed, and the focus must shift to the public good for a more effective and sustainable healthcare system.