In a rapidly globalizing world, countries are seeking efficient and sustainable healthcare solutions to meet the needs of their populations. Bangladesh, with its unique socio-economic challenges, is exploring various models to enhance its healthcare system. One of the proposals on the table is to implement a general practitioner-based primary health care system similar to that found in the United Kingdom. At the same time, there is a growing advocacy for financing this system through the social health insurance-based model known as the Bismarck model, which has its origins in Germany dating back to 1883. This blend offers a potentially strong solution, but is it feasible for Bangladesh?
Understanding the Bismarck Model
The Bismarck model stands as the oldest insurance system globally, relying on contributions from both formal sector enterprise owners and their workers. This dual contribution creates a central insurance fund, responsible for collecting these premiums and reimbursing healthcare providers for services delivered to insured individuals. The model functions on the principle of solidarity, a notion where contributions to the common fund are based on an individual’s capacity to pay. Typically, this amounts to 14.6 percent of a person’s income, shared equally between employers and employees. However, a key limitation of this model is that it does not extend coverage to those working outside the formal sector.
In Germany, the premiums charged are 14.6 percent of an individual’s salary, but the national average contribution across all public insurers in 2021 was around one percent, with an additional €10-15 required for the first medical visit each quarter. The average monthly premiums that insured individuals paid varied significantly, from €150 to €500 or more, with occasional variable contributions by public health insurance companies. Such a structure ensures a comprehensive and robust funding mechanism for the healthcare system.
Coverage and Costs in Germany
As of 2023, all employed residents in Germany earning between €520 and €5,550 monthly are mandated to have social health insurance. This mandate ensures that public insurance covers 90 percent of the German population, while the remaining 10 percent opt for private insurance, leaving a mere 0.1 percent without any form of insurance coverage. Germany extensively invests in its healthcare system, allocating 12.8 percent of its GDP, equating to approximately €5,000 per citizen annually. The social health insurance system mandates enrollment based on eligibility and regular contributions to support a broad risk pool necessary for comprehensive coverage.
Notably, health insurance premiums in Germany are partially tax-deductible, which incentivizes wealthier individuals to make consistent payments. Besides state agencies, nonprofit organizations may manage insurance funds, overseeing the collection of contributions, fund management, and reimbursement processes for healthcare providers. This allows private sector operators to administer public health insurance plans. Although hospitals and physicians typically function as private entities, the insurance fund manages claims, reimbursing providers based on pre-determined or negotiated rates. Germany’s healthcare system includes 110 public sickness funds that offer an array of services and serve various beneficiary categories.
Government’s Role and Healthcare Services
The German government plays a pivotal role in overseeing the healthcare system within this insurance model, establishing legal frameworks, setting service standards, and ensuring financial sustainability. While insurance companies purchase and pay for services, the contrast is stark with the Beveridge model, notably used in Britain’s National Health Service, where the government directly operates healthcare facilities and employs professionals through local public purchasers and payers.
Under the social health insurance scheme, retirees and unemployed residents gain coverage through state funds, with special provisions for self-employed individuals and university students. Additionally, family co-insurance extends coverage to spouses, civil partners, and children up to age 23, or 25 if engaged in studies. Those receiving unemployment benefits and German pensioners, including retirees, are all covered by the public healthcare system. This extensive inclusion ensures that vulnerable population segments maintain access to essential healthcare services.
Private vs. Public Insurance
Individuals can only subscribe to one insurance scheme at a given time. Although most statutory health insurance funds are open to all, private insurance is recommended for those with high healthcare costs or non-German speakers. Employers often contribute to private plan costs, encouraging the inclusion of private insurance to supplement public insurance, covering costs not addressed by the state system. Private health insurance is mandatory for high-income earners, freelancers, self-employed workers, civil servants, and international students over 30, as well as visitors to Germany who require additional coverage for family members. Non-residents and students over 30 must have private insurance to access healthcare services.
In private insurance scenarios, service recipients initially bear the medical costs, and later receive reimbursement from insurance companies. Conversely, publicly managed insurance covers medical bills at the point of service. The public health insurance system demands 95 percent uniformity in benefits across all companies, covering outpatient care, hospitalizations, and emergency care. The state health insurance system extends to emergencies, prenatal services, vaccinations, maternity care, and medications, sometimes requiring a co-payment.
Private insurance may cover a broader range of services than public insurance, though specific selections determine maternity coverage. Public insurance provides for cervical and breast cancer screenings, and children’s medical care is free until age 18. Pediatric care is available up to age 12, after which children transition to general doctors. Dental treatment for those under 18 is free, but private insurers do not fully reimburse expensive dental procedures like dentures and crowns.
Given these complexities and the differences in administration and coverage, implementing the Bismarck model in Bangladesh would present several challenges. The existing healthcare infrastructure and socio-economic context would need a major overhaul to accommodate this new system. The feasibility of managing diverse insurance plans with different rates and entitlements is another concern.
Considerations for Bangladesh
In our increasingly globalized world, nations are in search of efficient and sustainable healthcare solutions to meet the growing needs of their populations. Bangladesh, facing its own set of socio-economic challenges, is actively exploring different models to improve its healthcare system. One proposal being considered involves implementing a primary health care system based on the general practitioner model used in the United Kingdom. This system focuses on providing comprehensive and continuous care through family doctors.
Additionally, there is strong advocacy for financing this healthcare system via the social health insurance model, known as the Bismarck model. Originating in Germany in 1883, the Bismarck model relies on contributions from both employers and employees to fund healthcare through insurers. This blend of approaches might offer a robust solution for Bangladesh, potentially combining the accessibility of the UK system with the financial sustainability of the German model.
However, the question remains: is this hybrid model feasible for a country like Bangladesh? The challenges include adapting these systems to fit the local context, ensuring adequate funding, and managing the transition from the current healthcare setup. Still, the potential benefits could be substantial, offering a path to better healthcare for millions. As Bangladesh navigates its options, the combination of proven models from the UK and Germany could pave the way for a more effective and sustainable healthcare system.
