Act to reform the structure of hospital care
After presentation of the initial draft act on the reform of hospital care structures by the German Ministry of Health in April 2015, the German government’s bill (June 2015) is now in the middle of the legislative procedure. The proposed legislation aims to promote the continued development of high-quality hospital and patient care and to secure the economic future of the healthcare system.
Background and status of the legislative procedure
In December 2014, the working group on the reform of hospitals consisting of the German federal government and the individual German states (the Länder) drafted key points for implementing the objectives set out in the coalition agreement in order to improve hospital care. On 28 April 2015, the German Ministry of Health subsequently presented a draft act to reform hospital care structures. The aim of the proposed legislation is to guarantee and expand high-quality hospital and patient care and to secure the economic future of the healthcare system.
The government’s bill of 30 June 2015 to reform hospital care structures is meanwhile being discussed in the German lower and upper houses of parliament, the Bundestag and Bundesrat. The working group on hospital reform consisting of the government and the federal states have resolved initial changes to the original draft act. The planned reforms, which are scheduled to come into force on 1 January 2016, seek among other things to enhance the quality of hospital and patient care and to improve the financing possibilities available to hospitals. The key elements of the structural reforms include:
- Strengthening of direct nursing care for patients (exclusively bedside care) by setting up and gradually expanding a funding programme for new nursing jobs.
- Plans to set up a structural fund for improved care structures containing financing from the government and the federal states (reducing overcapacities or converting hospitals into local healthcare facilities).
- The introduction of a bonus-malus system of surcharges and discounts based on quality criteria for hospital services, provisions on the minimum number of procedures and the introduction of new selective contracts (quality contracts).
Position of the Bundesrat
On 10 July 2015, the federal German states commented on the bill in the upper house of parliament, the Bundesrat. In contrast to the federal government, the committee of federal states assumes that the planned legislative reforms will require their approval, since their participation in the planned structural fund will strain the budgets of the individual states. Moreover, the Bundesrat argues that the structural fund should be limited to five years.
Apart from this, the states have expressed their wish that the legislator should set out crucial exceptions in relation to the declining scale of discounts for fixed costs (as a quantity control instrument). They also say that the term of this declining scale of discounts for fixed costs should be shortened from five years to three. The Bundesrat has also called for an examination of additional measures to reduce the financial burden on hospitals in the course of the legislative procedure.
Consultation in the health committee
The government’s bill was the subject of a consultation by experts in the German Bundestag’s health committee on 7 September 2015, during which interest groups affected by the reform also submitted their comments. The objectives of the reforms – to improve the quality and funding of hospital care – were unanimously welcomed. Whether the planned funds will actually cover the funding required was, however, called into question. One particular target of criticism was the reduction in the financial support for healthcare provision (Versorgungszuschlag) from 2017, which will not be made up for by the new funding programme. The deductions for poor quality could also potentially increase cost pressure rather than contribute to improving the quality of hospital services.
Amendments by the working group
The working group on hospital reform has accepted some of the criticisms by the Bundesrat as well as the experts and interest groups who were consulted. On 2 October 2015, it agreed changes to the bill which are now to be implemented in the ongoing legislative procedure. The legislator is likely to decide on these amendments at the beginning of November.
Specifically, from 2017 the financial support for healthcare provision will be replaced by financial support for provision of nursing care (Pflegezuschlag) with a planned funding volume of 500 million euros per year. In addition, the funding programme for new nursing jobs will be extended to cover intensive care wards as well. In line with the request by the Bundesrat, the duration of the declining scale of discounts for fixed costs will be reduced to three years, and exceptions (for example where fees include material costs of more than two thirds) will be legally defined.
In the context of the new bonus-malus system which is to be introduced, it will also be made clear that where quality standards are not met, remuneration will be excluded after a maximum of three years. Other changes resolved by the working group concern emergency treatment by hospitals, enlargement and supplementation of the benefits that can be claimed for domestic care, and a prolongation and expansion of the hygiene funding programme.
Opinions on the reforms
The original draft act met with criticism from many stakeholders who believe that it does not offer any sustainable solutions with regard to the funding requirements of hospitals. It is above all the central association of health insurance companies, the GKV-Spitzenverband that has criticised the downward trend in investment financing by the federal states. But also representatives of the medical profession such as the German Medical Association (Bundesärztekammer) or the Association of Senior Hospital Physicians (Verband der leitenden Krankenhausärzte) have criticised the lack of willingness to invest on the part of the government and the individual states, stating that they are failing to satisfy the growing need for hospital, hygiene and nursing staff. However, the amendments most recently resolved by the working group, especially the financial support for provision of nursing care of 500 million euros, may well help to allay this criticism. The German Hospital Federation (Deutsche Krankenhaus Gesellschaft) responded to this proposal favourably, pointing out that it would certainly help improve the funding of hospitals’ ongoing costs. On the other hand, the German Hospital Federation believes that a sustainable solution for the inadequate investment funding by the individual states is still lacking.
Whether the act to reform hospital care structures will actually become binding on 1 January 2016, and in what form, remains to be seen.
Any questions? Please contact: Fabian Raddatz
Practice Group: Healthcare
Further reading: Gesetzentwurf zur Reform der Krankenhausversorgung vorgelegt