The German hospital sector is facing key structural decisions. The aim is to better secure funding for hospitals that are essential to meet local needs, whilst at the same time reducing the total number of healthcare facilities. A recently published proposal by the Reform Commission appointed by the Federal Minister for Health aims, amongst other things, to introduce what is known as ‘reserve funding’. As a result of a funding reform, funds from the main reimbursement system – the so-called DRG flat-rate payments – are to be distributed differently in future. The reorganisation of remuneration also affects quality competition amongst hospitals. Consequently, the systematic design through which ‘reserve funding’ could complement the funding system is also part of the analysis in the Monopoly Commission’s 83rd Special Report, which was submitted to the Federal Minister for Health in May last year. The federal and state governments are currently discussing the implementation of the announced funding reform. This policy brief contains a proposal for the design of reserve funding and explains its effects on budget allocation and quality competition amongst hospitals, on which the success of the reform crucially depends.
At a glance
The Monopolies Commission supports the introduction of flat-rate maintenance payments as proposed by the Hospitals Commission. At the same time, it proposes a significant amendment which would enable the objectives of ensuring the financial sustainability of hospitals that are essential to meet public needs and of maintaining competition on the basis of quality to be achieved. The Monopolies Commission specifically recommends to the Federal-State Working Group that
- linking the maintenance budgets to the structural and uncontrollable differences in regional healthcare costs, and
- to have the compensation factors empirically assessed by an expert report.
