Health
Cost cutting has been the focus of healthcare reform in Germany. A new study suggests smarter ways of financing healthcare and furthering the sector's economic growth.
The cost of healthcare is a much debated subject that repeatedly makes headlines, particularly in those countries trying to cut down on public expenditures. A recent Roland Berger Strategy Consultants study underlines how best to encourage further growth in the healthcare sector and create more jobs in the area. The authors suggest that 'smarter' financing, not simple cost-cutting is the way forward.
What is often forgotten in political debates about the future of healthcare in Germany is that it is the biggest sector of the German economy with an extremely promising growth potential. In fact, since the 1990s the healthcare sector's annual growth has consistently been one percentage point higher than the country's overall economic growth. The author of the study "Innovation in the Healthcare System" point out that with its combination of high-tech medical research and product development and its service intensive personal care sector and an ageing German population, the healthcare market looks set to balloon from EUR 260 billion today to EUR 450 billion by 2020.
"Patients' heightened awareness of their own health as well as of medical and technical progress coupled with an increasing life expectancy are fueling the demand for healthcare services," says Dr. Joachim Kartte, Partner with Roland Berger's Pharma and Healthcare Competence Center. Patients have also become more aware of their rights and are increasingly demanding greater transparency with respect to their treatment options. With growing demand for specialized and alternative services, the willingness to pay a private premium above and beyond public healthcare has also risen. With vitality, mobility and wellness becoming the new buzzwords with respect to healthy ageing, the percentage of those willing to finance at least part of their health costs privately is likely to rise considerably in the near future.
The cost of healthcare is a much debated subject that repeatedly makes headlines, particularly in those countries trying to cut down on public expenditures. A recent Roland Berger Strategy Consultants study underlines how best to encourage further growth in the healthcare sector and create more jobs in the area. The authors suggest that 'smarter' financing, not simple cost-cutting is the way forward.
What is often forgotten in political debates about the future of healthcare in Germany is that it is the biggest sector of the German economy with an extremely promising growth potential. In fact, since the 1990s the healthcare sector's annual growth has consistently been one percentage point higher than the country's overall economic growth. The author of the study "Innovation in the Healthcare System" point out that with its combination of high-tech medical research and product development and its service intensive personal care sector and an ageing German population, the healthcare market looks set to balloon from EUR 260 billion today to EUR 450 billion by 2020.
"Patients' heightened awareness of their own health as well as of medical and technical progress coupled with an increasing life expectancy are fueling the demand for healthcare services," says Dr. Joachim Kartte, Partner with Roland Berger's Pharma and Healthcare Competence Center. Patients have also become more aware of their rights and are increasingly demanding greater transparency with respect to their treatment options. With growing demand for specialized and alternative services, the willingness to pay a private premium above and beyond public healthcare has also risen. With vitality, mobility and wellness becoming the new buzzwords with respect to healthy ageing, the percentage of those willing to finance at least part of their health costs privately is likely to rise considerably in the near future.
Look what else we've got...
Private financing should be used to pay for innovation, the authors argue, as patients who invest more money in their own healthcare should be able to benefit from the latest therapeutic developments. "This does not go against the solidarity embedded in the German system," Kartte says. "The airbag and the ABS system were also initially financed by a few luxury car buyers before they became standard features that everyone could benefit from. And these two technologies have undoubtedly made a major contribution to safety and health."
The study suggests that by optimizing R&D and bringing this sector closer to the therapeutic side of medicine in so-called therapy research centers, the innovatory capacity of research could be enhanced and existing needs more adequately met. This type of systematic research to compare therapeutic approaches could help rid the system of old or even damaging medical treatment practices.
The authors also make concrete recommendations to politicians and health organizations: to foster growth in the healthcare sector and make related jobs more attractive, greater investments must be made in research and services. One of the key messages of the study for politicians is the necessity of deregulating healthcare structures to improve quality and innovation. One way to do this would be to allow cooperation between public and private of health insurance systems. Another would be to increase the scope for direct agreements between health insurance companies and service providers. In addition, certification systems for healthcare service providers could help patients to more easily assess the quality of the services they are receiving.
The study suggests that by optimizing R&D and bringing this sector closer to the therapeutic side of medicine in so-called therapy research centers, the innovatory capacity of research could be enhanced and existing needs more adequately met. This type of systematic research to compare therapeutic approaches could help rid the system of old or even damaging medical treatment practices.
The authors also make concrete recommendations to politicians and health organizations: to foster growth in the healthcare sector and make related jobs more attractive, greater investments must be made in research and services. One of the key messages of the study for politicians is the necessity of deregulating healthcare structures to improve quality and innovation. One way to do this would be to allow cooperation between public and private of health insurance systems. Another would be to increase the scope for direct agreements between health insurance companies and service providers. In addition, certification systems for healthcare service providers could help patients to more easily assess the quality of the services they are receiving.
For a download of the whole study (German language), please click here.
If you have further questions, please don't hesitate to contact us:
Language
English | German
More news
Oil Price Forecast for 2012
In this study, we examined if the 2011 oil price developments changed the top 3 performing... >>
The cross-industry...
At the ISPO Munich 2012, our principal from the Healthcare Competence Center Karsten Neumann, held a... >>
Roland Berger Strategy...
After 50 years, the road dividing Munich's famous English Garden park is to be rerouted through... >>
Roland Berger analysis:...
Since its lowest point in the first quarter of 2009, the price of a barrel of crude oil has climbed... >>
Germany's last optimist...
Burkhard Schwenker, Chairman of the Supervisory Board of Roland Berger Strategy Consultants, tells... >>
Germany has been one of the...
In an interview with Süddeutsche Zeitung, Roland Berger - founder and Honorary Chairman of Roland... >>
