German Health Reforms:

Changes Result in Lower Health Costs in 1993

HEHS-95-27: Published: Dec 16, 1994. Publicly Released: Dec 16, 1994.

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GAO reviewed the German health care system, focusing on the: (1) effects of nonnegotiable budgets on health care cost and access to care; and (2) status of some of the structural changes intended to control costs over the longer term.

GAO found that: (1) during 1993, the German health care sectors generally succeeded in controlling the growth of health care costs, with outlays per member falling more than one percent from 1992 levels; (2) the largest decrease in expenditures occurred in the pharmaceutical and denture sectors; (3) the negative growth rate allowed participants' insurance premiums to decline slightly, but expenditure growth could resume in the future; (4) there was little evidence that the low cost growth rate limited participants' access to appropriate care; (5) there was no evidence that German physicians failed to prescribe needed drugs or unnecessarily admitted patients to hospitals in order to shift them from the physician budget to the hospital budget; (6) it was not known how many community hospitals unnecessarily transferred patients to tertiary care facilities to remove them from their budgets; (7) there was insufficient data to predict the future success of German health care reforms; and (8) some structural reforms have not been implemented and others have not been in place long enough to determine their impact.

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