http://www.bloomberg.com/news/2010-07-06/merkel-raises-german-health-premiums-to-15-5-of-gross-pay-to-plug-deficit.htmlChancellor Angela Merkel’s coalition backed higher health-insurance premiums, a move some critics from her own party said will fail to curb rising health-care costs and might undermine the German economic recovery.
Coalition leaders meeting in Berlin today agreed to raise health premiums to 15.5 percent of gross pay from 14.9 percent, Health Minister Philipp Roesler said. Employers will contribute 7.3 percent with 8.2 percent paid by employees.
“We’re including everybody, workers, employers and taxpayers,” Roesler said in a statement distributed to reporters in Berlin.
The measure is part of an overhaul of health care intended to plug an 11-billion euro ($13.8 billion) deficit in the public health-insurance system in 2011. It follows Cabinet agreement on June 29 to cuts in spending on drugs to reduce soaring costs to public health-insurance funds.
Only 3.5 billion euros of the total shortfall next year will be covered by savings in administrative costs at hospitals, dental practices, through vaccinations and drug prescriptions, a Health Ministry document shows.
Merkel’s government “is taking the path of least resistance, ducking away from the Herculean tasks in health services,” Wolfgang Steiger, general secretary of a business lobby group within Merkel’s Christian Democratic Union, said in an e-mailed statement. “The one-sided financing of health costs via wages has to be stopped.”
Higher Surcharges
The Christian Democrats, their CSU Bavarian allies and Roesler’s Free Democrats also agreed to allow health insurers to levy higher surcharges for health care, paid by the insured person alone, according to the ministry document. Surcharges exceeding 2 percent of an insured’s gross pay will be financed from general tax revenue.
“The planned increase in employer contributions not only contradicts the coalition treaty, but also the most recent promises of the coalition parties not to raise labor costs any further,” Dieter Hundt, head of the BDA employers’ federation, said in an e-mailed statement.
The announcement comes one day before Merkel’s Cabinet considers plans to slash the budget deficit as Germany seeks to lead fellow euro-region countries in stemming the spread of Europe’s debt crisis from Greece.
To contact the reporter on this story: Rainer Buergin in Berlin at rbuergin1@bloomberg.net
