WEF PHSSR Germany Report

Sustainability and Resilience in the
German Health System

John Grosser and Wolfgang Greiner ▪ February 2021
Sustainability and Resilience in
the German Health System
Authors:
John Grosser and Wolfgang Greiner,
Bielefeld University
The Partnership for Health System Sustainability and Resilience (PHSSR). PHSSR was initiated by the
London School of Economics and Political Science (LSE), the World Economic Forum (WEF) and
AstraZeneca, motivated by a shared commitment to improving population health, through and beyond the
COVID-19 pandemic. The initial phase of the partnership, of which this report is a product, was funded solely
by AstraZeneca.
This report was produced on behalf of PHSSR as part of its pilot phase, in order to apply and test a framework
for the analysis of health system sustainability and resilience. The positions and arguments presented herein
are the authors’ own, and do not represent the views of AstraZeneca, the World Economic Forum or the
London School of Economics and Political Science.
For further information on the partnership, including further country reports, please visit
https://weforum.org/phssr
This report is commissioned via LSE Consulting which was set up by The London School of Economics and
Political Science to enable and facilitate the application of its academic expertise and intellectual resources.
LSE Enterprise Ltd, trading as LSE Consulting, is a wholly owned subsidiary of the London School of
Economics and Political Science. The LSE trademark is used under licence from the London School of
Economics and Political Science.
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Contents
Executive Summary 4
1. Health System Governance 7

1.1 Governance Sustainability 7
1.2 Governance Resilience 8
1.3 Governance Recommendations 8
2. Health System Financing 9

2.1 Financing Sustainability 9
2.2 Financing Resilience 11
2.3 Financing Recommendations 11
3. Workforce 12
3.1 Workforce Sustainability 12
3.2 Workforce Resilience 13
3.3 Workforce Recommendations 14
4. Medicines and Technology 14

4.1 Medicines and Technology Sustainability 14
4.2 Digital Health and Sustainability in Germany 16
4.3 Medicines and Technology Resilience 16
4.4 Medicines and Technology Recommendations 17
5. Service Delivery 17
5.1 Service Delivery Sustainability 17
5.2 Service Delivery Resilience 19
5.3 Service Delivery Recommendations 19
6. References 21
Annex I. Case Study – Digitalisation 25

Context and Case Study Goals 25
Case Analysis 25
Key Findings, Recommendations and Limitations 26
References 27
Annex II. Case Study – Rural Healthcare 28

Context and Case Study Goals 28
Case Analysis 28
Key Findings, Recommendations and Limitations 30
References 31
3
Executive Summary
This is the report of the German country team for the Partnership for Health System Sustainability and
Resilience (PHSSR), an initiative by the London School of Economics (LSE), the World Economic Forum and
AstraZeneca. The aim of the report was to identify key factors relating to the sustainability and resilience
(during the COVID-19 pandemic) of the German health system along five domains: Governance, Financing,
Workforce, Medicines & Technology and Service Delivery. This analysis was guided by a sustainability and
resilience framework developed by the LSE. Table 1 gives an overview of key findings from the report. In
addition to a rapid review of available literature, five interviews were conducted with four stakeholders in order
to generate additional insights and feedback for the report. These interview partners were Prof. Christoph
Straub of BARMER (a large German statutory insurance fund), Prof. Alexander Krämer of Bielefeld University,
Dr. Georg Rüter of the Catholic Hospital Association of Ostwestfalen, and Dr. Martin Danner of the BAG
Selbsthilfe (a patient advocacy group).
Table 1: Key Findings of the German PHSSR Report
Domain Sustainability Resilience
Governance Key governance sustainability factors in Germany’s response to COVID-19 was

Germany are the health system’s mostly successful in the early stages of
corporatist self-administration structure the pandemic in terms of governance
and German federalism, in which the resilience. However, local public health
Länder are responsible for many health authorities, who play a key role in
policy areas. pandemic response, were understaffed
and underfunded for decades.
Financing Germany’s statutory insurance financing The German health system is capable of
mechanism is currently successful, but accumulating reserves in both the national
faces risks from demographic change, Health Fund and through individual
economic downturn, and rising costs from insurance funds, the size of these
technological advances. reserves is heavily regulated.
Hospital investments by the Länder are

currently insufficient.
Workforce Germany has a large healthcare Although local public health authorities
workforce, but workload is very high. are understaffed, Germany was able to
Workforce sustainability is threatened by rapidly, but temporarily, expand its public
a future lack of general practitioners in health workforce during the COVID-19
rural areas and nurses in long-term pandemic.
care/nursing homes.
There are significant legal hurdles to

professional delegation and substitution;
task-shifting from physicians to nurses is
uncommon.
Medicines & The German AMNOG process for the Stockpiling provisions of German
Technology adoption of new medications is robust and pandemic preparedness plans were not
offers rapid access to new drugs but lacks diligently followed, adversely impacting
health system resilience. Germany did not
4
regular and systematic economic cost- have a national reserve of medicines,

benefit analyses. medical technologies and consumables.
Germany remains an important location Germany is relatively independent of non-

for pharmaceutical research and European countries for pharmaceutical
production, although its significance has imports but significantly less independent
been surpassed by other nations in recent for basic pharmaceutical production
decades. materials. Germany participates in the
European Joint Procurement Agreement
While Germany struggles to digitise its for medical countermeasures.
health system, there have been significant
efforts in recent years to improve its
overall digital infrastructure.
Service Control and supervision of physicians and Germany’s COVID-19 response efforts
Delivery care providers in the German health included the rapid expansion of hospital
system are predominantly finance-based, and ICU capacity. Reserve funds were
not quality-based. used to finance hospital bed space and
ICU capacities.
Patients covered by statutory insurance
have free choice of provider, but some Elective procedures were delayed due to
incentives exist to treat their general COVID-19, although surprisingly effective
practitioner as a gatekeeper to specialist cross-sectoral coordination allowed
care. outpatient services to reduce the strain on
inpatient care by handling many non-
Cross-sectoral coordination of care and severe COVID-19 cases.
the promotion of new care models
represent a problem area due to the strict
separation of financing, provider
renumeration, planning procedures and
regulatory responsibility between care
sectors.
Chronic disease prevention efforts are an

uncoordinated patchwork of preventive
services provided by many organisations
and institutions.
5
Based on the findings of the report and the stakeholder interviews, several recommendations for increasing
the sustainability and resilience of the German health system were formulated for each domain. Table 2 gives
an overview of these recommendations, which include both concrete policy proposals and general calls for
reform.
Table 2: Key Recommendations of the German PHSSR Report
Domain Sustainability Resilience
Governance Recommendation 1A: Reform of planning Recommendation 1B: Prioritising local

processes, including the linkage of public health authorities and
inpatient and outpatient planning strengthening the federal government’s
role in questions of pandemic response
Financing Recommendation 2A: Moving from dual Recommendation 2C: More strongly
financing of hospital costs to a monistic incentivising the accumulation of sufficient
financing system financial reserves
Recommendation 2B: Reforming the DRG

system, moving from activity-based to flat-
rate reimbursement for contingency costs
Workforce Recommendation 3A: Ensuring an Recommendation 3C: Increased

adequate future level of nursing and care protections for healthcare workers
professionals across regions (adequate provision of PPE, safety
education)
Recommendation 3B: Simplifying the
employment of foreign nationals in the Recommendation 3D: Strengthening of
German healthcare system the public health workforce: increased
hiring and training
Medicines & Recommendation 4A: Incorporating Recommendation 4C: Increasing

Technology regular cost-benefit analyses into the stockpiling capacity through stockpiling
AMNOG process requirements for pharmacies, physicians,
and hospitals as well as public reserves.
Recommendation 4B: Addressing supply
bottlenecks through expanded reporting, Recommendation 4D: European
critical medication reserves and incentives production of critical medications and
for European pharmaceutical production relevant raw materials
Service Recommendation 5A: Structural reforms Recommendation 5D: Measures aiming

Delivery of the hospital sector: decreased hospital for a reduction in non-emergency
capacity and more quality-oriented treatment during shocks while
specialised treatment facilities simultaneously guaranteeing the
continued provision of sufficient levels of
Recommendation 5B: Establishing emergency care
procedures for regional cross-sectoral
care planning using fixed-capacity and
activity-based criteria
Recommendation 5C: Empowering

relevant actors and institutions to use
available quality data to monitor, control
and enforce care quality
6
1. Health System Governance

1.1 Governance Sustainability
German health governance is characterised by high government involvement and significantly influenced by
German federalism. Governmental actors are supplemented by the health system’s so-called “self-
administration structure” (gemeinsame Selbstverwaltung): While governments create legal frameworks and
regulations for the health system, significant governance roles are afforded to care and insurance providers,
organised into associations and public law corporations (Verbände).
The German Federal Ministry of Health (BMG) sets major national health policy and controls subordinate
upper-level agencies (Simon, 2013, p. 125), including the Robert-Koch-Institute (RKI), tasked with disease
prevention and control, and the Federal Center for Health Education (Bundeszentrale für gesundheitliche
Aufklärung, BZgA), responsible for public awareness and health education. The BMG is advised by an
independent advisory council (Sachverständigenrat zur Begutachtung der Entwicklungen im
Gesundheitswesen). State-level health and social ministries as well as subordinated state health agencies
perform various duties, especially planning and distributing hospital capacity and capital investments (Simon,
2013, p. 127). However, these state investments remain insufficient (Busse, Blümel, & Spranger, 2017, p. 147)
and state control of inpatient planning hinders cross-sectoral coordination, as outpatient planning is the
responsibility of regional Associations of Statutory Health Insurance Physicians (Kassenärztliche
Vereinigungen). State-level decision-makers also have their own legislative and regulatory powers in health
issues (Land, 2018, p. 80). Although states may not enact policies contradicting federal health law, this regional
independence creates further possibilities for planning incompatibility.
The self-administration structure has significant decision-making authority in Health Technology Assessment
(HTA) and benefits definition. Chief among its actors is the Federal Joint Committee (Gemeinsamer
Bundesausschuss, G-BA). The G-BA consists of impartial voting members and voting representatives of the
National Association of Statutory Health Insurance Funds (Spitzenverband Bund der Krankenkassen, GKV-
SV), the National Association of Statutory Health Insurance Physicians (Kassenärztliche Bundesvereinigung,
KBV), the National Association of Statutory Health Insurance Dentists (Kassenzahnärztliche
Bundesvereinigung, KZBV), and the German Hospital Federation (Deutsche Krankenhausgesellschaft, DKG)
(Simon, 2013, p. 129). Patient advocacy organisations are represented by non-voting members, although
patient participation in health system governance has been on the rise since 2004.
The G-BA has independent legislative authority and can directly enact binding regulations. In particular, it is
responsible for making coverage decisions for statutory insurance funds, regulating the conduction of HTAs
and determining the benefits of proposed treatments to inform the price negotiations (Busse, Blümel, &
Spranger, 2017, pp. 67-69). While private insurance providers must at least match statutory benefits, they may
set their own, potentially more expansive, benefit schemes (although they do not conduct their own HTAs).
This transfer of power to non-state entities operating independently from the BMG is a defining feature of the
German health system’s decentral governance and contributes to both the delinking of health system planning
from the political cycle and increased public trust in health system decision-making. However, it may hinder
the public’s ability to hold decision-makers accountable. Although the self-administration structure’s
transparency has been criticised in the past, the G-BA makes its decisions in public hearings, which members
of the public may attend (Simon, 2013, p. 130).
The German health system is governed by a unique structure of governmental and non-governmental decision-
makers. This structure insulates health system planning from political considerations (to a degree) but may
complicate accountability and chains of command. Independent expertise is valued by decision-makers and
stakeholders are either directly engaged in policy formation or at least have the right to be heard.
7
1.2 Governance Resilience

Disease surveillance in Germany is governed by the Infektionsschutzgesetz (IfSG), which empowers the RKI
to conduct epidemiological surveillance and early warning efforts. For instance, doctors and other care
providers must report cases of COVID-19 to local public health authorities within 24 hours; cases are then
reported to state health agencies and the RKI (RKI, 2020a, p. 31). However, this process is inconsistently
applied and often suffers from outdated technology and reporting delays.
In 2005, the states and federal government published a comprehensive National Pandemic Plan (NPP). This
plan was successfully implemented during the 2009 influenza pandemic, after which it was improved and
updated with the involvement of experts and various stakeholders (RKI, 2020a, p. 6). At the onset of the
COVID-19 pandemic, the NPP allowed for a rapid mobilisation of public health resources (Wieler, Rexroth, &
Gottschalk, 2020). But despite this national plan, it is local public health authorities, of which there are around
400, who are responsible for public health measures such as testing and contact tracing. And although contact
tracing began earlier than in other countries and early successes bought valuable time (Wieler, Rexroth, &
Gottschalk, 2020), local public health authorities were insufficiently prepared for their responsibilities during a
nationwide pandemic due to decades of inadequate funding (Arentz & Wild, 2020, pp. 21-22).
Public health coordination between governance levels has been moderately successful so far. While state
policies have occasionally diverged, states and the federal government have also issued joint contact bans
and other cooperative policies (Wieler, Rexroth, & Gottschalk, 2020). In January 2020, coordination provisions
of a federal infectious disease regulation were activated, allowing for better information exchange between
local, state and federal actors (RKI, 2020a, p. 23). Despite initial setbacks, cross-sectoral coordination has
also been a success (Arentz & Wild, 2020, p. 21): outpatient services handled many non-severe COVID-19
cases, relieving the strain on inpatient services.
In their pandemic response efforts, German health officials at the state and federal level sought and valued
scientific expertise and implemented public health measures based on expert input (Arnold, 2020, pp. 5-6).
While there were some early policy failures, guidelines and regulations were regularly updated to reflect new
knowledge and developments. In a joint effort between the RKI, BMG, and BZgA, these decisions have usually
been communicated transparently to the German public, which has been broadly receptive to public health
messaging (Arnold, 2020, pp. 2-3).
Finally, it should be considered how government attempts to strengthen resilience during a shock can harm
long-term sustainability. For example, the inefficient distribution of ventilators to care providers by the
government harms sustainability while not contributing significantly to resilience.
1.3 Governance Recommendations

Recommendation 1A: The German health system’s sustainability could be improved through a reformed
planning process. This would entail depoliticising hospital planning by limiting the role of state governments,
as well as linking inpatient and outpatient planning efforts, thus reducing planning inefficiencies. Increasing the
involvement of patients in policymaking relative to other stakeholders could also be considered.
Recommendation 1B: Governance sustainability and resilience could be improved through the long-term
prioritisation of local public health authorities, whose important role in health system governance has not been
reflected in the provision of necessary resources and funding. These local actors require a significant increase
in funding, both during and prior to health system shocks. The flexibility of German federalism, with local actors
adapting and implementing national public health policies to best suit their region, is only a strength if these
local actors are equipped to fulfill their role.
Recommendation 1C: Federalism can also provide an obstacle to a coordinated national response to health
system shocks. A possible improvement would be to strengthen the role of the federal government in questions
of pandemic response.
8
2. Health System Financing

2.1 Financing Sustainability
Germany’s health system is funded mainly by an assortment of insurance schemes, dominated by the statutory
health insurance system, which provided 56.8% of total funding in 2018 (Destatis, 2020b). Additional funding
is provided by private insurance and other insurance systems, such as statutory accident or care insurance.
Private individuals, employers, and the state supply the remaining health system funds. Table 1 shows the
share of private and public health funding as well as the share of out-of-pocket expenses. Statutory health
insurance funding is collected, but not immediately spent by individual insurance providers. Rather, the
collected income-based employer and employee contributions are pooled in a national Health Fund
(Gesundheitsfonds) and supplemented by tax-funded federal payments. The Health Fund then distributes
funding to the statutory insurance providers based on the morbidity of their covered population using a risk
compensation schedule (Risikostrukturausgleich, RSA) (Busse, Blümel, & Spranger, 2017, pp. 120, 127). This
occurs in the context of individuals having freedom to choose among statutory health insurance providers, and
these providers not being allowed to turn down individuals based on their health profile (guaranteed issue).
Table 1: Funding indicators of financing sustainability, 2010-2019
Funding Indicator 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Share of public health funding 72.0 71.8 71.8 72.7 73.3 73.3 73.6 74.0 74.0 -
Share of private health funding 28.0 28.2 28.2 27.3 26.7 26.7 26.4 26.0 26.0 -
OOPS; share of CHE 14.0 14.0 14.1 13.3 12.9 13.0 12.9 12.7 - -
Notes: Values in %. OOPS: out-of-pocket spending, CHE: current health expenditures. Public funding: tax funds and
statutory insurance. Private funding: private insurance, private households and nonprofits, and employers. Hyphens
indicate data not yet available.
Source: Destatis, WHO Global Health Expenditure Database
Spending projections for the statutory insurance system and the Health Fund are conducted by an estimation
committee (Schätzerkreis), consisting of experts from both the Ministry of Health and the GKV-SV (BAS, 2016).
This committee projects the number and income of those covered by statutory health insurance, the income
of the national Health Fund and the expenses of statutory insurance providers for the period of one year. An
overview of health spending as a share of GDP and by health system sector is given in Table 2.
Table 2: Spending indicators of financing sustainability, 2010-2019
Spending Indicator 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Health spending; share of 11.4 11.0 11.1 11.2 11.2 11.4 11.5 11.6 11.7 -
GDP
Outpatient health spending 49.8 49.6 49.5 49.6 50.0 50.2 50.2 49.7 49.6 -
Inpatient health spending 36.9 37.3 37.4 37.4 37.4 37.1 36.9 36.8 36.5 -
Public health spending 0.8 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 -
Notes: Values in %. GDP: gross domestic product. Spending on public health is equated with spending on
Gesundheitsschutz. Hyphens indicate data not yet available.
Source: Destatis
9
Statutory health insurance providers may not accumulate significant surpluses or deficits, as their financing
structure is organised as a pay-as-you-go system, in which yearly expenditures should correspond exactly to
allocated funds (apart from a small fluctuation reserve). They may, however, use small surpluses achieved
through the efficient use of funding received from the Health Fund to accumulate small financial reserves or
distribute them to their customers. Statutory insurance providers must compensate deficits by increasing the
individual contributions customers pay. There is no provision for the bailout of financially struggling statutory
insurance providers, but these struggles may be alleviated through (voluntary or mandatory) fusion with other
statutory providers.
The situation differs for private insurance providers, who insure approximately 10% of the German population
(PKV, 2020). These providers are permitted to accumulate significant funding reserves and do so in the form
of so-called Alterungsrückstellungen (PKV, 2017). These reserves help private insurers account for
demographic change and medical costs that rise with the age of the insured, although they can be used for
other purposes as well.
With an individual mandate and guaranteed issue (Ridic, Gleason, & Ridic, 2012, p. 114), the German health
system has achieved near-universal health insurance coverage: less than 1% of the population are not covered
(Destatis, 2020a, p. 31). However, some groups are at higher risk of non-coverage. These include self-
employed individuals and freelancers. While some unemployed individuals who were previously self-employed
remain undercovered, the government pays the insurance costs of the vast majority of unemployed individuals
(Simon, 2013, p. 184).
Provider payment mechanisms differ between care providers. Hospital costs are split by type of cost:
investment costs are paid by state governments, while operating costs are covered by payments from statutory
and private insurance providers and patients, with payment based on Diagnosis Related Groups (DRGs) and
additional fees (Zusatzentgelte) for specialised services (Busse, Blümel, & Spranger, 2017, pp. 138, 145).
There remains a significant need for hospital financing reform: hospital planning does not sufficiently meet the
population’s medical needs and investment payments are inadequate (Sachverständigenrat, 2018, p. 763).
Outpatient providers who participate in the statutory health insurance system are paid on a fee-for-service
basis (Ridic, Gleason, & Ridic, 2012, p. 114) through a two-step process in which state-level Associations of
Statutory Health Insurance Physicians receive funds from statutory health insurance providers and divide these
funds among physicians based on patient morbidity and services provided (Busse, Blümel, & Spranger, 2017,
pp. 150-151). However, outpatient physicians are only paid up to defined maximum limits per average patient.
These fee-for-service payments are complemented by lump-sum payments, especially for general
practitioners.
In theory, the German health system has a progressive financing system with near-universal coverage,
although there is a regressive contribution cap for high-income individuals and some population groups remain
undercovered. However, its financing sustainability suffers with regard to hospital financing, where investment
costs are insufficient and capacity planning is not efficient and does not reflect the medical needs of the
population. Additionally, general spending projections are limited to one year. Germany also has an older
population than many comparable countries; as the financing of the statutory health insurance system depends
on the income of the covered population, the German health system’s financing sustainability is threatened by
demographic change in the country. Table 3 illustrates these demographic changes and threats to sustainable
financing. Finally, the rapidly rising costs of medical innovation and modern treatment options pose an even
more significant risk to the financing sustainability of German health insurance providers.
10
Table 3: Demographic and government debt indicators of financing sustainability, 2010-2019
Demographic/Debt Indicator 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Share of population over 65 20.6 20.7 20.8 20.9 21.0 21.1 21.2 21.4 21.5 21.8
Labor force participation rate 54.6 54.7 54.9 55.1 55.2 55.1 55.0 55.4 55.7 56.0
Government debt; share of 82.3 79.7 81.1 78.7 75.6 72.3 69.3 65.1 61.8 59.6
GDP
Notes: Values in %. GDP: gross domestic product
Source: Destatis, Eurostat
2.2 Financing Resilience

German law requires funds to be held in reserve by both individual statutory insurance providers and the
national Health Fund. The Health Fund must reserve a financial cushion no lower than 20% and no higher
than 50% of its average monthly expenses (§ 271 II SGB V), while individual insurance providers must set a
reserve amount no lower than 25% of their average monthly expenses (§ 261 SGB V). In recent years, small
surpluses by statutory insurance providers have accumulated into significant financial cushions for individual
insurance funds, jointly totaling 21 billion Euros in mid-2020 (BMG, 2020a). This is in addition to financial
reserves in the national Health Fund, which totaled 10 billion Euros in January 2020. By comparison, in June
2020, private health insurance providers had accumulated over 270 billion Euros (PKV, 2020) of financial
reserves (Altersrückstellungen).
These financial cushions enhance the financing resilience of the German health system, which was able to
flexibly utilise Health Fund reserves for pandemic response and public health efforts. For example, in the first
six months of 2020, over 7 billion Euros from the Health Fund reserve were spent on reimbursing hospitals for
reserving beds, increasing intensive care capacities and other pandemic response measures (BMG, 2020a).
Beyond these reserves, significant federal funding was made directly available to health insurance providers
in order to pay for testing and financial relief for care providers. However, attempts by the federal government
during the ongoing pandemic to force statutory insurance providers with significant reserves to surrender these
reserves rather than providing additional government funding may be a disincentive for these providers to
accumulate sufficient financial reserves in the future.
2.3 Financing Recommendations

Recommendation 2A: The current dual financing system has led to inadequate hospital investments. Moving
toward a monistic financing system, in which both investment and operating costs are covered by statutory
health insurance providers, may help alleviate these problems. Such a financing system could also decouple
investment and planning decisions from political cycles (Sachverständigenrat, 2018, p. 238).
Recommendation 2B: Reforming the DRG system and moving from activity-based reimbursement toward flat-
rate reimbursement for contingency costs may lead to better financial incentives for hospitals providing care
and better reflect the care situation of individual hospitals (Sachverständigenrat, 2018, p. 764).
Recommendation 3C: While the statutory health insurance system is capable of acquiring financial cushions,
the size of these reserves is heavily regulated. Financial reserves may not exceed limits set by federal
legislation and recent legislative reforms have required statutory insurance providers to begin lowering their
reserves through payments to and lower rates for their insured population (BMG, 2018). The German health
system relies on income-based payments (which may suffer during a pandemic and corresponding economic
downturn); accumulating sufficient financial reserves should be more strongly incentivised.
11
3. Workforce
3.1 Workforce Sustainability
Germany has a large healthcare workforce, contributing to the health systems workforce sustainability: In 2018,
over 5.6 million people were employed in the German health system (Destatis, 2020c). The healthcare
workforce has been expanding in recent years, growing by 18% between 2009 and 2018. With 4.3 physicians
and 12.9 nursing professionals per 1,000 inhabitants in 2017 (OECD, 2019, pp. 173,179), Germany is
considerably ahead of OECD averages (3.5 and 8.8, respectively). Table 4 shows the evolution of numbers of
physicians and nursing professionals since 2008. While the size of the German healthcare workforce is
considerable, this has not translated into lower caseloads. On the contrary, caseloads per fulltime equivalent
for physicians and nursing professionals are significantly larger than in comparable EU countries (Arentz &
Wild, 2020, p. 5). Additionally, due to a higher workload and the lower prestige of non-specialised medicine,
Germany suffers from a lack of general practitioners in rural areas, while population centers are overserved
(Klose & Rehbein, 2017). Due in part to this geographic mismatch and the shifting demographics of both
physicians and providers, the country’s substantial healthcare workforce may not correspond adequately to
population medical needs in the coming years, threatening workforce sustainability.
Table 4: Profession size indicators of workforce sustainability, 2008-2017
Profession Size Indicators 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Physicians 3.6 3.7 3.8 3.8 3.9 4.0 4.1 4.1 4.1 4.2
Nurses and midwives 11.5 11.8 12.0 12.1 12.2 12.5 12.8 12.9 13.1 13.2
Notes: Values in amount per 1,000 population. Inclusion criteria may create differences between World Bank and OECD
data on health workforce size.
Source: World Bank
Aligning the workforce with these needs is complicated by the distribution of financing, education and planning
responsibility for healthcare workers among federal, state, and private actors (Busse, Blümel, & Spranger,
2017, pp. 177-179), reflecting the health system’s decentralised governance structure. Federal standards
govern many aspects of medical education and workforce planning, state governments are responsible for
regulating and financing academic medical education, whereas continuing medical education and personnel
development are within the purview of healthcare workers’ professional associations. The state-level
Associations of Statutory Health Insurance Physicians are also responsible for the planning and regional
distribution of physicians (in cooperation with statutory insurance providers). This responsibility separation can
complicate national long-term workforce planning, but allows such planning to better reflect regional needs,
perhaps enhancing workforce sustainability (although specific planning regions could be better drawn to more
effectively target actual regional needs). Additionally, the health system remains capable of workforce planning
in response to system-wide pressures and risks: For example, federal legislation aiming to increase the
number of general practitioners through education funding and pay raises was passed in 2015, while state
governments have also increased their activity in this area.
Germany emphasises professional development for health workers. Structured (sub-)specialisation curricula
are in place for physicians, who are required to complete a multi-year specialisation after their academic
education. Additionally, all health workers involved in the outpatient treatment of patients covered by statutory
health insurance must undergo continuous professional development through their professional associations
(Busse, Blümel, & Spranger, 2017, pp. 182-184). Professional development will only increase in relevance in
the upcoming years, as digitalisation and new technologies increase the need for new digital skills within the
workforce.
12
Especially compared to similar European countries, the German health system is heavily reliant on physicians,
who enjoy higher prestige than nursing professionals (EXPH, 2019, p. 54) and may therefore be reluctant to
transfer care responsibilities to non-physicians, despite general approval for such transfers among the
population (Jedro, et al., 2020, p. 589). Perhaps most importantly, there are significant legal hurdles to
professional delegation and substitution in the German health system. These factors impede task-shifting and
cross-profession cooperation: a 2019 report found no significant task-shifting in the German health system
(EXPH, 2019, p. 18).
In recent years, job satisfaction for German healthcare workers has diverged significantly by profession; Table
5 gives an overview of several factors related to job satisfaction and working conditions. While physician job
satisfaction rose by 14.4% from 1990 to 2012, job satisfaction among nursing professionals fell by 7.5%
(Alameddine, Bauer, Richter, & Sousa-Poza, 2015, pp. 3-4), driven mainly by a decline among part-time
nursing employees. Although there was no corresponding increase in turnover for nursing professionals in the
same time period (Alameddine, Bauer, Richter, & Sousa-Poza, 2017, p. 4), insufficient salary increases
(primarily in long-term care/nursing homes), high workloads, low status and other factors contribute to the
possibility of a future nurse shortage (Alameddine, Bauer, Richter, & Sousa-Poza, 2015, pp. 6-7).
Table 5: Working condition indicators of workforce sustainability, 2017/2019
Working Condition Indicator

Remuneration, general practitioner 4.4
Remuneration, salaried specialist physician 3.5
Remuneration, self-employed specialist physician 5.4
Remuneration, hospital nurse 1.1
Migratory inflow of physicians 3,800
Migratory outflow of physicians - 1,898
Notes: Remunerations data from 2017, given as ratio to average wage. In-/Outflow data from 2019, given as absolute
values.
Source: OECD, Bundesärztekammer
The sizeable German healthcare workforce and its continuous professional development are a sign of
sustainability, although caseloads for healthcare professionals remain high compared to the European average
due to high number of hospitals and increased demand owing to aging of the population. Meanwhile, a reliance
on physicians and inability to transfer care responsibility to other health professionals adversely affect
workforce sustainability. National long-term workforce planning efforts may be inhibited by Germany’s complex
distribution of planning and education responsibility. Finally, declining job satisfaction and employment
conditions among nursing professionals present a long-term risk to workforce sustainability. However, public
awareness of these risks is high and policymakers have begun to respond. For example, nursing work has
been decoupled from DRGs and education fees for nursing trainees have been removed.
3.2 Workforce Resilience

Although significantly increasing the number or workload of healthcare professionals appears unfeasible due
to the already large size and workload of Germany’s health workforce, personnel capacities were successfully
reallocated in response to COVID-19 by, for example, delaying elective procedures (Arentz & Wild, 2020, p.
21; Paffenholz, et al., 2020, p. 1592). Simultaneously, Germany was able to rapidly expand its public health
workforce through support from several thousand soldiers dispatched by the German army (Schulz, 2020) and
the hiring of short-term “containment scouts” (Wieler, Rexroth, & Gottschalk, 2020), both of which are assisting
local public health authorities in contact tracing and other public health measures.
13
COVID-19 represents an ongoing threat to healthcare workers’ emotional and physical health: by late October
2020, the RKI had reported over 18,700 infections among employees of hospitals, outpatient clinics and other
medical facilities (RKI, 2020b, p. 5). Although safety procedures and guidelines for healthcare workers are in
place, with many employers providing specific COVID-19 training, the workforce has suffered from a lack of
personal protective equipment (PPE), especially in the outpatient sector and in the East German states
(Paffenholz, et al., 2020, pp. 1592-1593). Training measures are not equally available: physicians and inpatient
employees receive COVID-19 training significantly more often than nurses and outpatient employees,
respectively.
3.3 Workforce Recommendations

Recommendation 3A: To increase the German health system’s long-term workforce sustainability, additional
measures should be implemented to ensure an adequate level of nursing and care professionals and sufficient
cooperation between physicians and nurses, especially in light of demographic change. This requires a multi-
pronged approach, including elevating the status of nursing and other non-physician healthcare professions,
increasing their pay and benefits, and encouraging task-shifting between physicians and nursing professionals,
especially concerning minor treatments and drug administration.
Recommendation 3B: Simplify the employment of foreign nationals in health jobs in Germany through the
reduction of bureaucratic hurdles.
Recommendation 3C: Regarding resilience, protections for healthcare workers should be increased, especially
through the adequate provision of personal protective equipment. Disparities in workplace safety between
sectors and professions adversely affect workforce resilience: employees at outpatient facilities and nursing
professionals should receive additional personal protective equipment and COVID-19 training.
Recommendation 3D: The public health workforce in Germany must be strengthened through the creation of
more permanent positions within local public health authorities and through increased educational/vocational
training for public health jobs.
4. Medicines and Technology

4.1 Medicines and Technology Sustainability
In the German health system, HTAs and other processes relating to the adoption of new medications,
procedures and medical technologies differ between different settings and types of medical innovation. For
new medications, this adoption process is governed primarily by the Pharmaceutical Market Reorganisation
Act (Arzneimittelmarktneuordnungsgesetz, AMNOG) of 2010.
First, new medications must go through regulatory approval procedures. Although it is possible to request
national approval through the Federal Institute for Medications and Medical Products (Bundesinstitut für
Arzneimittel und Medizinprodukte, BfArM), most pharmaceutical companies submit innovative medications for
EEA-wide approval with the European Medicines Agency (EMA). When regulatory approval has been gained
for a new medication, the manufacturer may take it to market in Germany immediately at a freely chosen price.
In this time period, statutory health insurance providers fully reimburse these new medications. This allows
very rapid access to new treatments for German patients without access limitations based on economic
decisions, increasing sustainability.
Within the first year after approval, an HTA process takes place in order to determine the relative effectiveness
and appropriate pricing of the new medication. Based on materials submitted by the pharmaceutical
companies, the Federal Joint Committee evaluates the benefit of the new medication in relation to appropriate
14
comparative therapies. If an additional benefit is found, the manufacturer and the GKV-SV negotiate a price
based on the size of and scientific evidence for this additional benefit, as well as prices in other European
countries and the annual therapy costs of the comparative therapy. If no additional benefit is found, the price
is set at the level of the annual therapy costs of the comparative therapy. This price applies to the new
medication beginning in the 13th month after approval. Should these negotiations fail, the price is decided on
by an arbitration board, consisting of neutral members and representatives of both manufacturers and
insurance providers. Should one of the negotiating parties reject the price set by the arbitration board, that
party may request an economic cost-benefit evaluation of the new medication, which is conducted by the
Institute for Quality and Efficiency in Health Care (Institut für Qualität und Wirtschaftlichkeit im
Gesundheitswesen, IQWiG). However, these evaluations must be financed by the requesting party.
Consequently, since the passage of AMNOG, no economic evaluations have been conducted through this
process, creating space for the improvement of sustainability through the incorporation of regular, systematic
economic evaluations into the HTA process.
The rapid adoption mechanisms for new medications indicate high sustainability and the overall approval and
HTA process in the German health system is robust. For example, over 70 new cancer drugs were adopted
between 2015 and 2019, according to data from the Federal Joint Committee. However, unless they are later
proven to be unsafe, Germany has no provision for the de-adoption of low-value/obsolete medicines and
technologies. Rather, safe medicines remain on the market even if better alternatives exist, potentially
inhibiting sustainability but increasing competition and therapeutic choice for patients and physicians.
However, the pricing procedure for unproven additional benefits ensures that these therapies do not lead to
higher costs.
While new medications are adopted through this AMNOG process, new and innovative non-pharmaceutical
treatments and operating procedures may be adopted by hospitals without an HTA process, potentially
encouraging cost-effective innovation, as these new procedures are reimbursed according to existing DRGs.
If the costs of new procedures exceed the DRG-based reimbursement, hospitals can apply for the creation of
a new DRG through a process administered by an independent calculation institute (InEK). Meanwhile, new
outpatient procedures must be approved by the Federal Joint Committee before adoption by outpatient
healthcare providers.
Germany also remains an important location in terms of pharmaceutical research and development
capabilities. While new global players in pharmaceutical research and production have begun to emerge
among developing nations, Germany’s domestic research capacity for drugs and medical technologies
remains strong, with the German Association of Pharmaceutical Research Companies (Verband der
forschenden Pharma-Unternehmen, vfa) representing 45 global leaders in medical innovation, including both
well-established companies, such as Bayer, and comparatively new players, such as BioNTech. In fact, in
November 2020, BioNTech and Pfizer announced a COVID-19 vaccine candidate with over 90% efficacy,
highlighting the continued significance of Germany as a pharmaceutical research location (Pfizer & BioNTech,
2020). Nevertheless, Germany’s significance as a pharmaceutical location has been surpassed by other
countries in areas such as research or development (Bräuninger, Straubhaar, Fitzner, & Teichmann, 2008, p.
6). Beyond research and development, Germany remains a strong player in pharmaceutical production (vfa,
2020); German pharmaceutical companies have already begun selecting locations for COVID-19 vaccine
production.
However, problems remain for the sustainability of Germany’s medicines supply. In late November of 2020,
BfArM reported 249 supply chain bottlenecks for various medications and dosages, ranging in type from
common painkillers to more complex treatments and in length from short-term to multi-year bottlenecks (BfArM,
2020a). While these numbers must be seen in relation to the total number of medications on the German
market, and while a large majority of unavailable medications can be replaced through other drugs or therapies
(Korzilius, 2019), rising delivery bottlenecks for a wide range of medications represent a threat to the long-
term sustainability of the German health system in the domain of medicines and technology.
15
4.2 Digital Health and Sustainability in Germany

Beyond pharmaceuticals and medications, Germany has recently introduced significant policy innovations
designed to increase the adoption and accessibility of digital health services and innovative digital
technologies. Three efforts are especially relevant to health system sustainability: attempts to increase usage
of remote medicine (such as remote consultations), the improved adoption of digital health applications
(Digitale Gesundheitsanwendungen, DiGAs), and the implementation of electronic patient records and
prescriptions.
The 2015 Secure Digital Communication and Applications in Healthcare Act (Gesetz für sichere digitale
Kommunikation und Anwendungen im Gesundheitswesen) provided for the inclusion of remote consultations
conducted by physicians for patients with certain indications into the statutory insurance benefit scheme. This
inclusion was realised in mid-2017. However, in the first 21 months after these provisions entered into force,
the remote consultation option was chosen by a very small minority of patients (Gensorowsky, Surmann,
Schmidt, & Greiner, Nutzungsgrad und Nutzergruppen der Online-Videosprechstunde in der ambulanten
ärztlichen Versorgung, in press). But this may be changing; new research indicates that not only have a large
number of patients made their first experiences with remote consultations during the COVID-19 pandemic
(Gerlof, 2020), but also that many are willing to continue using them after the pandemic. In Germany, remote
consultations appear to be here to stay.
Germany has also introduced regulations for the adoption of digital health applications, such as cell phone
apps treating depression or anxiety. Since the entry into force of the Digital Care Act (Digitale-Versorgung-
Gesetz, DVG) in late 2019, these DiGAs can be prescribed by physicians and are reimbursed by statutory
health insurance providers. With lower evidentiary standards and a 3-month fast-track approval process,
gaining approval for DiGAs (which are classified as low-risk) is less strictly regulated than approval for
pharmaceuticals (BfArM, 2020b). This has been the subject of criticism, but also offers an opportunity for
innovative and flexible responses to patient needs.
Finally, there have been significant efforts in recent years to improve the overall digital infrastructure of the
German health system. While electronic patient records are currently in use only by individual insurance
providers, this will change in 2021. Due to new legislation, all statutory insurance providers will offer electronic
patient records (BMG, 2019a) and pharmacies, hospitals, and outpatient physicians will be required to connect
to the new digital healthcare infrastructure (BMG, 2020b), with other care providers able to connect voluntarily.
This represents a critical step toward a more digital and sustainable health system.
4.3 Medicines and Technology Resilience

German pandemic preparedness plans discuss the importance of emergency health supply stockpiles during
a pandemic and recommend such stockpiles be created. However, the stockpiling provisions of these plans
were not diligently followed prior to the onset of the COVID-19 pandemic, adversely impacting health system
resilience. While pharmacies are required by law to keep small stockpiles, Germany did not have a national
reserve of medicines, medical technologies and consumables as of 2019. This may have contributed to some
of Germany’s shortages of PPE, especially masks, during the first wave of the COVID-19 pandemic. While
some medication shortages have been reported in recent months (Sonnenholzner, 2020), replacement
therapies can be swapped for many of these medications.
In a positive sign for health system resilience, Germany is relatively independent of non-European countries
for pharmaceutical imports, with a diversified procurement portfolio in addition to Germany’s domestic
manufacturing capabilities (Braml, Teti, & Aichele, 2020). However, this applies mainly to finished
pharmaceutical products: Germany is significantly less independent when it comes to basic pharmaceutical
production materials. In addition, Germany participates in the Joint Procurement Agreement for medical
countermeasures (JPA). Approved by the European Commission in 2014, the JPA now includes all EU and
EEA member states, the UK, Kosovo, and a number of EU membership candidates and potential candidates.
16
In response to the COVID-19 pandemic, the JPA enabled the signing of procurement frameworks and
agreements for treatments and vaccines.
4.4 Medicines and Technology Recommendations

Recommendation 4A: Although Germany has a strong adoption process for new medications in the form of
AMNOG, balancing rapid market access with later HTA procedures, the lack of regular and systematic
economic cost-benefit evaluations denies decision-makers critical information and represents a threat to health
system sustainability with regards to medicines and technology. Rather than giving negotiating parties the
option to request a self-financed economic evaluation only after negotiation failures, adoption procedures
should be reworked to include a systematic economic evaluation of new medications as a standard element
of the process. Additionally, expanding cost-benefit evaluations to include medical infrastructure and other
aspects of care provision could be considered.
Recommendation 4B: Supply bottlenecks in Germany could be addressed through a three-pronged set of
measures. First, Germany’s voluntary bottleneck reporting system could be expanded, with emerging
medication bottlenecks being rapidly reported to the appropriate authorities. At the same time, manufacturers
or wholesalers could be required to keep reserves of critical medications in order to avoid short-term
bottlenecks. Finally, financial incentives (such as long-term purchase guarantees) should be put in place to
keep pharmaceutical production in Europe, lessening dependence on other countries and global
developments.
Recommendation 4C: In order to strengthen health system resilience with regards to medicines and
technology, it is critical that Germany drastically increase its stockpiling capacity for essential medicines,
devices, and consumables. However, there is disagreement over the optimal form for such stockpiles. While
policymakers have suggested a central national stockpile under control of the federal government
(afp/aerzteblatt.de, 2020), this may lead to inefficiency in distribution and waste. Instead, it may be more
prudent to choose a combined approach, in which sufficiently strong stockpiling requirements for pharmacies,
physicians, and hospitals are adopted and supplemented through state-level stockpiles and a federal reserve
of high-priority medicines and consumables, stored at a number of decentralised locations (similarly to the US
Strategic National Stockpile). Such an approach may strike the right balance between preparedness and
flexibility, enhancing resilience.
Recommendation 4D: Finally, expanding European pharmaceutical production capacities may represent a
partial alternative to stockpiling. These production capacities should focus on important medications that are
no longer highly profitable for pharmaceutical companies to produce and should include not only the
medications themselves, but also relevant raw materials. Such an expansion could take the multiple forms,
such as expanded production subsidies or state-administered production facilities.
5. Service Delivery
5.1 Service Delivery Sustainability
Control and supervision of physicians and care providers in the German health system are predominantly
finance-based, not quality-based. The majority of such controls focus on economic analyses of physicians’
prescribing behavior, rather than on evaluations of the quality of care (Busse, Blümel, & Spranger, 2017, p.
220), although provisions exist for the inspection of individual physicians due to “other damages”, such as the
violation of medical regulations. There are no widespread financial incentives for individual physicians to
provide higher-quality care, although private initiatives such as the Bertelsmann Foundation’s Weisse Liste
offer patients quality-focused assessments of potential care providers. However, the degree to which patients
base care decision on third-party quality ratings is debated in the literature (Lako & Rosenau, 2009).
17
Although the German health system includes an agency dedicated to monitoring care quality in the form of the
Institute for Quality Assurance and Transparency in Healthcare (Institut für Qualitätssicherung und
Transparenz im Gesundheitswesen, IQTIG), the agency does not possess enforcement powers. IQTIG
monitors the quality of care across the German health system, with a special focus on hospitals. Beyond IQTIG,
local public health authorities play a role in supervising hygiene conditions for hospitals and other care
providers in their jurisdictions, while the BZgA monitors the quality of disease prevention efforts (Busse,
Blümel, & Spranger, 2017, pp. 186-189). Large data sets concerning healthcare quality are collected by these
and other actors throughout the German health system but are not actively utilised for quality supervision and
control.
Regarding service delivery efficiency, the average length of hospital stays in Germany has been slowly but
steadily declining in recent years, falling from 9.7 days in 2000 to 8.1 days in 2008 and further to 7.3 days in
2018 (RKI; Destatis, 2020). For patients suffering from acute myocardial infarction, the average length of
hospital stays has also decreased, but remained above the average of all patients. In particular, average length
of stay for these patients fell from 10 days in 2000 to 9.0 days in 2008 and to 7.7 days in 2018. The German
health system financially incentivises hospitals to reduce readmission rates: The treatment of patients returning
to a hospital for the same condition within 30 days is reimbursed as part of the initial DRG – hospitals do not
receive additional payment for the treatment of these patients.
Patients covered by statutory health insurance enjoy free choice of care provider in the German health system.
In particular, patients are not required to see a primary physician before accessing specialist care. However,
several measures are in place to incentivise patients treating their general practitioner as a de facto – if not de
jure – gatekeeper to specialist care. For example, statutory insurance funds do not pay for direct access to
some care providers, such as physical therapists or speech therapists, without a referral. Additionally, statutory
insurance providers are required by law to offer their covered population a general practitioner-focused care
model (Hausarztzentrierte Versorgung, HzV); insured individuals who choose to voluntarily participate in their
insurance provider’s HzV commit themselves to visiting their general practitioner and only accessing specialist
care with a referral from this general practitioner (BMG, 2020c). In return, for example, shorter waiting times
are possible in practice. Exceptions to these access limitations include emergency treatment, gynecological
care, pediatricians, and ophthalmologists. Almost 6 million patients in Germany choose their insurance
provider’s HzV option (Deutscher Hausärzteverband, 2020), although regional differences exist in the adoption
of HzV programmes, with the state of Baden-Württemberg emerging as a leader in general practitioner-focused
care models (Universitätsklinikum Heidelberg; Goethe-Universität Frankfurt am Main, 2018).
Cross-sectoral coordination of care and the promotion of new care models represent a problem area in the
German health system, threatening sustainability in the domain of service delivery. The main cause of
problems in this area is the strict separation of care sectors in Germany (Sachverständigenrat, 2018, p. 764).
Inpatient and outpatient care is subject to different financing and provider remuneration systems and different
regulations by various governance actors, complicating integration efforts. In recent years, several efforts to
overcome this separation and establish new cross-sectoral care programmes have met with limited success.
Established in 2012, the outpatient specialist medical care programme (Ambulante Spezialfachärztliche
Versorgung, ASV) is a novel care concept for the diagnosis and treatment of rare or complex diseases. While
ASV has the potential to increase substitution of inpatient by outpatient services, high participation
requirements and bureaucratic hurdles have led to a dearth of significant results (Korzilius & Osterloh, 2017).
Administrative burdens and regulatory rigidity have also hindered the decades-long effort by German health
decision-makers to promote integrated care contracts (Integrierte Versorgung). In integrated care models,
statutory health insurance providers and care providers from different sectors sign contracts allowing for the
provision of cross-sectoral care, such as outpatient care being provided by hospitals. Although changes in
relevant legislation sparked an increased interest in integrated care contracts in the mid-2000s, progress in
this area remains unsatisfactory (Sachverständigenrat, 2018, p. 764). Recent efforts to promote integrated
18
care include the expansion of the programme to new types of contractual partners and the establishment of
the Innovationsfonds, which has funded research into new care models with 225 million Euros annually
between 2016 and 2019 (BMG, 2019b) and 160 million Euros annually starting in 2020.
The coordination of complex care across professional groups (and, for some diseases, across sectors) is the
goal of Germany’s Disease Management Programmes (DMPs). These programmes aim at coordinated care
provision to patients suffering from specific chronic diseases, such as diabetes, breast cancer, or chronic back
pain based on contracts between statutory health insurance providers and regional Associations of Statutory
Health Insurance Physicians. However, the effectiveness of DMPs remains limited by the small number of
indications for which DMPs exist (Sachverständigenrat, 2018, p. 765).
While there exists a national prevention conference, which develops and maintains a national prevention
strategy, chronic disease prevention efforts in Germany are characterised by a wide array of responsible
governmental and non-governmental actors with overlapping areas of responsibility at the federal, state, and
local level. This leads to an uncoordinated patchwork of preventive services provided by hundreds of
organisations and institutions (RKI; Destatis, 2015, pp. 242-243), which adversely affects sustainability in
disease prevention. Due to the large number of actors involved in preventive care, this report will briefly outline
a selection of the most important institutions: local public health authorities, the RKI, statutory health insurance
providers and the BZgA.
A central role in disease prevention is afforded to local public health authorities, which fulfill duties in disease
monitoring, diagnosis, and reporting. These local public health authorities cooperate with the federal RKI,
especially with regards to disease reporting efforts. Statutory health insurance providers have an important
role in financing prevention efforts: Since 2000, preventive care measures included in statutory insurance
benefit schemes have been successively expanded by both legislative action and benefit expansion by
individual insurance providers. Finally, the BZgA is the key creator and disseminator of health education and
public messaging in the German health system, with responsibilities including sexual education, family
planning, addiction prevention and health education for children, youth and the elderly, as well as messaging
campaigns regarding organ, tissue and blood donations.
5.2 Service Delivery Resilience

Service delivery resilience in the German health system was affected by many of the same factors affecting
resilience in other domains. As described in the financing section of this report, Germany’s COVID-19 response
efforts included the rapid expansion of hospital and ICU capacity. A key policy instrument in this expansion
was the use of reserve funds to finance hospital bed space and intensive care capacities (BMG, 2020a).
Elective procedures were delayed due to COVID-19, although surprisingly effective cross-sectoral coordination
allowed outpatient services to reduce the strain on inpatient care by handling many non-severe COVID-19
cases (Arentz & Wild, 2020, p. 21). Analysis of claims data from Germany’s first lockdown in March and April
2020 has shown a 39% reduction in hospital cases compared to 2019 (WIdO, 2020). Although these reductions
were stronger among elective treatments (79% reduction in arthrosis-related hip replacement surgery),
emergency treatments also saw a significant reduction (31%, 18% and 37% reduction in the treatment of heart
attacks, strokes and transient ischemic attacks, respectively).
5.3 Service Delivery Recommendations

Recommendation 5A: In order to strengthen the sustainability of service delivery in the German health system,
decision-makers should consider structural reforms of the German hospital sector. In particular, hospital
planning should be quality-oriented, with specialised treatment facilities focused on the delivery of high-quality
care in their field replacing the current system of overwhelmingly general-purpose hospitals. Establishing
procedures for the regional planning of cross-sectoral care using both fixed-capacity and activity-based criteria,
19
as opposed to planning strictly segregated by sector, could also contribute to a more sustainable planning
landscape.
Recommendation 5B: Furthermore, integrated care models should be expanded in order to promote cross-
sectoral care, a critical aspect of service delivery sustainability. As a first step in this direction, the
Sachverständigenrat recommends the “authorisation of pharmacists as equivalent contractors in the context
of integrated care models” (Sachverständigenrat, 2018, p. 765). The Innovationsfonds plays an important role
in researching and promoting new care models. For this reason, it is critical that funding for the programme is
sustained at sufficient levels beyond the current 2020-2024 funding period.
Recommendation 5C: Throughout the German health system, relevant actors and institutions should be
empowered to use available quality data to monitor and control quality of care. This would require granting the
IQTIG or another agency at least some enforcement powers. This strengthening of quality control mechanisms
would represent an increase in service delivery sustainability.
Recommendation 5D: With regards to service delivery resilience, health decision-makers must aim for a
reduction in non-emergency treatment while simultaneously guaranteeing the continued provision of sufficient
levels of emergency care. While financial incentives to hold hospital capacity in reserve are important policy
tools for a resilient pandemic response, policymakers must ensure that these incentives do not lead hospitals
to reduce their care capacity for purely financial reasons; public health must be the primary motivator. Public
messaging campaigns are another important tool for informing patients of both the risks of elective, non-urgent
treatment during a pandemic and the importance of not neglecting their emergency care needs.
20
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Gerlof, H. (2020, November 12). Videosprechstunde: Gekommen, um zu bleiben. ÄrzteZeitung.
Jedro, C., Holmberg, C., Tille, F., Widmann, J., Schneider, A., Stumm, J., . . . Schnitzer, S. (2020).
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Ärzteblatt, 35-36, pp. 583-590.
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Deutsches Ärzteblatt, 45, pp. A-2060 / B-1690 / C-1654.
Korzilius, H., & Osterloh, F. (2017). Ambulante Spezialfachärztliche Versorgung (ASV): „Gut gemeint,
schlecht gemacht“. Deutsches Ärzteblatt, 18, pp. A-878 / B-738 / C-724.
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Perception of the 2020 SARS-Cov-2 pandemic among medical professionals in Germany: results from a
nationwide online survey. Emerging microbes and infections, 1, pp. 1590-1599.
doi:10.1080/22221751.2020.1785951
Pfizer & BioNTech. (2020, November 09). Pfizer and BioNTech Announce Vaccine Candidate Against
COVID-19 Achieved Success in First Interim Analysis from Phase 3 Study. Retrieved from biontech.de:
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vaccine-candidate-against-covid-19/
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strong enabling environment. Retrieved November 5, 2020, from Our World in Data:
https://ourworldindata.org/covid-exemplar-germany
24
Annex I. Case Study – Digitalisation

Context and Case Study Goals
Digitalisation in health systems has become a major focus for policymakers, industry and researchers in recent
years. Moreover, the cost-effective use of digital health services and digital health infrastructure is a key
property of sustainable health systems. Two types of digitalisation in particular are highly relevant to health
system sustainability and resilience. These are the digitalisation of health system processes, such as the use
of electronic patient records systems, and the digitalisation of healthcare provision.
This case study examines how the digitalisation of processes and care provision can contribute to health
system sustainability and resilience, using as examples the German health system’s upcoming introduction of
an electronic patient record (Elektronische Patientenakte, ePA) as well as its use of remote patient
consultations as a form of digital care. This question cuts across the five domains of sustainability and
resilience used in the PHSSR pilot phase. As this case study considers the use of digital technology in
organising and providing healthcare, its largest implications are for the domains of medicines & technology as
well as service delivery. Increased efficiency and other potential savings strongly impact the financing domain.
However, the governance domain significantly influences whether and how digital health programmes are
adopted and implemented. Finally, digital health initiatives also have an impact on the duties of the health
workforce.
Case Analysis
While the German health system has shown its willingness and ability to embrace the benefits of digitalisation
with regards to billing, past progress on digital information systems has been limited. In particular,
implementation of an electronic insurance card stalled prior to its planned introduction in 2006, with many of
the card’s features remaining unusable more than a decade later. However, recent legislative action has
mandated the introduction of the ePA by statutory insurance providers starting in 2021 (BMG, 2019a), which
will allow primary and secondary care providers to access important health and treatment information. The
implementation of the ePA was delayed by German governance priorities. In particular, strict German data
protection regulations have proven to be a significant obstacle to programmes such as the ePA, with debates
between federal officials and statutory insurance providers about the ePA’s conformity with federal and
European data protection law (DAZ.online, 2020). Use of the ePA will remain optional to patients, who must
choose to opt in to the programme.
Beyond enhancing sustainability in the medicines & technology domain, the ePA may also contribute to
increased service delivery sustainability in several ways. In particular, this information exchange could improve
coordination between different sectors and providers and lead to quality improvements through a reduction of
therapeutic errors, drug-drug interactions and superfluous treatment (Bertram, Püschner, Gonçalves, Binder,
& Amelung, 2019, pp. 4-6). Improved access to patients’ treatment information may also allow primary care
providers to take a more active role in care management for patients with multiple providers. Streamlining
patient access to their own medical data and strengthening information transparency may also improve
treatment adherence and trust in their treatment specifically and the health system in general.
Recent years have also seen new efforts by German health decision-makers to further digital care provision.
Remote consultations were added to Germany’s statutory insurance benefit scheme in 2017, allowing
physicians to remotely examine, diagnose and treat patients with a variety of indications. While new digital
healthcare tools have the potential to increase health system sustainability across domains by improving
access and timeliness of care and creating additional treatment flexibility for patients and providers, they also
bring important benefits for service delivery resilience. Remote consultations do not require physical contact
between patients and providers, allowing care providers to maintain healthcare services during a pandemic.
In fact, utilisation of remote consultations, which were rarely chosen by patients before the onset of the COVID-
25
19 pandemic (Gensorowsky, Surmann, Schmidt, & Greiner, in press), has risen dramatically in 2020, with
many patients willing to continue using remote consultations after the pandemic has ended (Gerlof, 2020).
Furthermore, digitalisation of health system processes and healthcare provision are expected to bring
significant economic benefits. In particular, the transition to unified electronic health records – digitally
accessible to providers – and the use of online interaction between patients and providers, such as remote
consultations, patient monitoring and E-triage are estimated to deliver up to 6.4 billion and 8.9 billion Euro in
savings for the German health system (McKinsey, 2018), respectively, with a corresponding effect on the
system’s financing sustainability.
Germany is falling behind the curve in digital health (Thiel, et al., 2018). In response, the country has recently
implemented a number of new health system digitalisation initiatives. The success of these initiatives depends
on a number of factors. With regard to electronic patient records, German health system decision-makers must
carefully balance the importance of data protection with the utility of the newly introduced ePA. For example,
the ePA has enormous potential to not only streamline patient care across the health system, but also provide
medical researchers with an unprecedented data set. Beyond data protection concerns, the ePA’s effect on
health system sustainability and resilience will depend on its utilisation level: if an insufficient number of
patients choose to opt in to the programme, its benefits will not be fully realised. With regard to remote
consultation, the question of utilisation levels also looms large. While many patients indicate they are open to
using remote consultations, it is unclear whether utilisation of this option will remain sufficiently high after the
conclusion of the COVID-19 pandemic.
Key Findings, Recommendations and Limitations

If successful, the German health system’s recent efforts to digitalise health system processes and care
provision through the creation of an electronic patient records system and the use of remote consultations will
bring significant benefits for health system sustainability and resilience. Their success will depend on their
ongoing implementation.
In order for the ePA to achieve sufficient utilisation, use of the system should be organised on an opt-out,
rather than an opt-in basis, with patients automatically enrolled by their insurance provider unless they explicitly
object. Furthermore, the ePA should be implemented in such a way as to allow researchers access to de-
identified medical data. Looking beyond electronic medical records, the German health system cannot rely on
ongoing pandemic shocks to drive patient demand for digital care. After the COVID-19 pandemic, decision-
makers should therefore implement measures to incentivise and simplify the continued use of remote
consultations.
This case study is, by nature of its brevity, limited in scope. The German health system is complex, as are the
ongoing efforts to increase its level of digitalisation. Many of the efforts discussed here are extremely recent
or not yet fully implemented. The purpose of this case study was therefore to provide a brief overview of new
health system digitalisation initiatives in Germany and their potential to affect sustainability and resilience
across various domains; further research will be needed in order to judge the extent to which the ePA and
remote consultations have fulfilled this potential.
Future research will also be required into the effect of digital health applications (Digitale
Gesundheitsanwendungen, DiGAs), which were added to Germany’s statutory insurance benefit scheme in
2019. For example, web-based apps to treat anxiety or depression can be prescribed to patients and are
financed directly by the sickness funds. While lower regulatory restrictions for reimbursement of DiGAs than
for other therapies (like drugs) have been criticized, DiGAs represent an innovative digital care model whose
efficacy should be continually evaluated.
26
References
Bertram, N., Püschner, F., Gonçalves, A. S., Binder, S., & Amelung, V. E. (2019). Einführung einer
elektronischen Patientenakte in Deutschland vor dem Hintergrund der internationalen Erfahrung. In J.
Klauber, M. Geraedts, J. Friedrich, & J. Wasem, Krankenhaus-Report 2019 (pp. 3-16). Berlin, Essen
and Marburg: Springer Open.
BMG. (2019a, October 10). Die elektronische Patientenakte (ePA). Retrieved from Bundesministerium für
Gesundheit - Service: https://www.bundesgesundheitsministerium.de/service/begriffe-von-a-
z/e/elektronische-patientenakte.html
DAZ.online. (2020, October 06). AOK-Experten: Datenschutzkritik an ePA ist unbegründet. Deutsche
Apotheker Zeitung. Retrieved December 1, 2020, from https://www.deutsche-apotheker-
zeitung.de/news/artikel/2020/10/06/aok-experten-datenschutzkritik-an-epa-ist-unbegruendet
Gensorowsky, D., Surmann, B., Schmidt, J., & Greiner, W. (in press). Nutzungsgrad und Nutzergruppen der
Online-Videosprechstunde in der ambulanten ärztlichen Versorgung. Das Gesundheitswesen.
Gerlof, H. (2020, November 12). Videosprechstunde: Gekommen, um zu bleiben. ÄrzteZeitung.
McKinsey. (2018). Digitizing healthcare - opportunities for Germany.
Thiel, R., Deimel, L., Schmidtmann, D., Piesche, K., Hüsing, T., Rennoch, J., . . . Kostera, T. (2018).
#SmartHealthSystems: Digitalisierungsstrategien im internationalen Vergleich. Bertelsmann Stiftung.
27
Annex II. Case Study – Rural Healthcare

Context and Case Study Goals
Regional disparities in access to healthcare and the existence of underserved, often rural, regions represent
a serious threat to health system sustainability and resilience, with patients in underserved regions often
unable to access quality care in a timely fashion. For example, rural patients may be at increased risk of
cardiovascular disease if they are afforded insufficient access to screenings and preventive care due to a lack
of general practitioners or cardiologists in their area. Consequently, optimising the location of health services
delivery can make an important contribution to sustainability and resilience. While Germany currently does not
suffer from a lack of physicians or general practitioners, demographic changes in both population of physicians
and the general population threaten to create new issues in the upcoming years.
The purpose of this case study is to evaluate recent efforts by the German health system to improve access
to timely, high-quality medical care in rural areas. The evaluated efforts include legislative and regulatory
changes to the needs planning process and to instruments designed to address the over- or underprovision of
care. The focus will be placed on outpatient care, and on general practitioners in particular. Several domains
of sustainability and resilience are relevant to this line of inquiry. Specifically, the German health system’s
complex governance structure impacts the needs planning process and the implementation of other
instruments, while the geographic distribution of outpatient physicians directly impacts sustainability and
resilience in the domains of workforce and service delivery.
Case Analysis
Increasing the availability of timely, high-quality medical care in rural areas is a complex undertaking.
Interlocking trends have caused increased movement toward urban centres by both the general population
and physicians in particular: As more young people move away from rural communities and into larger cities,
these areas become increasingly less attractive, including for (young) physicians. At the same time, the
population remaining in these communities is older and more morbid, increasing demand for medical care
while supply diminishes. Addressing these complex issues calls for a multi-pronged approach. This case study
will focus on three important elements of such a strategy. These are: a needs planning process for physicians
which sufficiently reflects rural care needs, instruments to incentivise the movement of physicians into
underserved areas as well as instruments designed to disincentivise the movement of physicians to overserved
areas.
Effective needs planning represents a key component of strategies to provide better care to rural regions.
Outpatient planning in the German health system is mainly the responsibility of the regional Associations of
Statutory Health Insurance Physicians (Kassenärztliche Vereinigungen, KV). The process is regulated by the
Federal Joint Committee’s Needs Planning Directive (Bedarfsplanungsrichtlinie), which creates a nationwide
framework for regional planning efforts. Since 2012, significant changes have been made to the needs
planning process in Germany, with the potential to increase health system sustainability and resilience.
Whereas in the 1990s, needs planning was a mechanism designed to keep the rising number of doctors under
control (Sundmacher, et al., 2018, p. 199), it is now a mechanism designed to distribute physicians to where
they are most needed. To this effect, a 2013 revision of the Needs Planning Directive created four care levels,
each with separate planning regions. These planning regions increase in size and decrease in number as care
becomes more specialised. For general practitioners, this reform represented a significant increase in the
number of planning regions and a move to smaller geographical subdivisions, which “far better matches actual
health care needs” (Sachverständigenrat, 2014, p. 99).
Overall, changes to the Needs Planning Directive since 2012 have significantly reformed the needs planning
process in Germany, with uniform federal planning standards supplemented by mechanisms to strengthen
regional flexibility, such as adjustments for regional morbidity or demographics (G-BA, 2017). These post-2012
28
reforms represent steps toward reducing regional inequality in access to healthcare, potentially increasing
health system sustainability.
The needs planning process is supplemented by instruments designed to reduce the number of under- and
overserved regions. For underserved regions, these include financial incentives (Sundmacher, et al., 2018,
pp. 193-194) such as service guarantee fees or revenue guarantees. Additionally, hospitals in underserved
regions can be empowered to take up outpatient care responsibilities on a case-by-case basis. Alternatively,
statutory insurance providers and local governments can operate their own care facilities. Finally, a new
structural fund (Strukturfonds), which is jointly financed by the regional Associations of Statutory Health
Insurance Providers and Physicians, aims to provide financial support for the establishment of new physicians’
practices in regions that are underserved or at risk of becoming so.
Beyond these efforts to motivate existing physicians to establish practices in underserved regions, new
measures have been implemented to increase the number of medical students who will become general
practitioners in these regions after their medical education is complete. One such measure is the
Landarztquote, which would allow privileged access to medical education for students who agree to provide
care in a rural area for a certain duration (Martini & Ziekow, 2015, p. 18). North Rhine-Westphalia became the
first state to use a Landarztquote in 2019 (Ministerium für Arbeit, Gesundheit und Soziales des Landes
Nordrhein-Westfalen, 2019), and several other German states have decided to implement or are considering
implementing the programme. While there are legal and constitutional questions about the feasibility of such
a scheme, a 2015 report commissioned by the Federal Ministry of Health found that it could be implemented
in permissible ways (Martini & Ziekow, 2015, pp. 209-214). Furthermore, general medicine has become a
stronger focus of both academic and practical components of medical education in Germany (BMBF, 2017),
including expanded internships for medical students in rural general practitioners’ practices. These educational
reforms aim to contribute to the movement of new physicians to underserved rural areas.
However, a focus only on underserved regions is insufficient. In order to minimise regional disparities,
providers must also be incentivised to leave or avoid moving to overserved regions. Several instruments are
available to achieve this. In particular, the process of replacing retiring outpatient physicians has been
reformed, with replacements limited to case-by-case exceptions in overserved regions (Busse, Blümel, &
Spranger, 2017, pp. 249, 254). Additionally, financial incentives and regulatory instruments are available in
order to close existing practices in overserved regions. In general, physicians may not settle in overserved
regions without being granted case-by-case exemptions.
For a number of reasons, there has been little improvement in the number of general practitioner planning
regions with inadequate provision levels since despite these reforms to the needs planning process and to
instruments combatting under-and overprovision. First, the revised Needs Planning Directive did not have the
anticipated effect of increasing the number of physician practices and accreditations nationwide. Instead, “the
total number of practices decreased under the new Directive across all four care levels” (Sachverständigenrat,
2014, p. 100).
Furthermore, instruments to combat over- and underprovision have seen insufficient use. With regard to
overserved regions, financial incentives for the voluntary relinquishment of practices proved mostly ineffective,
while revised rules establishing that newly vacant practices in severely overserved regions shall be bought
back by the responsible KV have rarely been used in practice. In underserved regions, financial incentives
played “only a marginal role” (Sachverständigenrat, 2014, p. 104) as of 2014. At the same time, practices
owned by regional associations or local governments remained rare. The insufficient use of these instruments
was compounded by non-uniform definitions and determinations of which regions were at risk of becoming
underserved.
However, a more fundamental deficit adversely affected needs planning in the German health system. In
particular, the target values that form the basis of the Needs Planning Directive were not based on objective
29
analyses or estimations of medical need, but rather on historical data at certain dates (mostly from the 1990s),
insufficiently adjusted to actual population morbidity (Sundmacher, et al., 2018, p. 138). This leads to a
planning process that is not sufficiently aligned with actual population medical need.
Key Findings, Recommendations and Limitations

Major legislative and regulatory reforms as well as the introduction of new instruments to combat under- and
overprovision of care since 2012 represent an important step toward health system sustainability and resilience
in Germany by aiming to reduce regional disparities and ensure timely access to quality healthcare for the
entire population. However, these reforms were limited in their overall effectiveness by the sparse use of
available instruments and by fundamental flaws in the needs planning process, such as in the definition of
target values.
In response, 2018 reports by the advisory council (Sachverständigenrat) and the Federal Joint Committee
called for important reforms, including to the needs planning process. These recommendations (Sundmacher,
et al., 2018, pp. 201-203; Sachverständigenrat, 2018, p. 99) include smaller, more homogenous planning
regions and a national monitoring of instrument usage and effects. Perhaps more importantly, the reports call
for a stronger focus on actual morbidity and a reform of the system of target values based on historical data.
This is highly relevant to health system sustainability, as the current target values do not match true population
need. The recommended shift to cross-sectoral planning would also represent an important step towards
sustainability and resilience, especially in the governance domain. Finally, the recommended establishment of
a prospective planning process, including medical education and anticipated physician retirements, would
substantially improve the German needs planning process and allow the better integration of needs planning
and other instruments focused on education.
In 2019, the Federal Joint Committee completed a revision of the Needs Planning Directive called for in the
GKV-VSG. While much remains to be done (such as increased cross-sectoral planning), this revision
implemented many of the above recommendations, changed the way target values are calculated, increased
regional flexibility in needs planning and created new instruments to combat over- and underprovision of care.
Further research will be necessary to evaluate the effect of both these reforms and other recently introduced
instruments discussed in this case study.
30
References
BMBF. (2017). Masterplan Medizinstudium 2020. Berlin. Abgerufen am 15. December 2020 von
https://www.bmbf.de/files/2017-03-31_Masterplan%20Beschlusstext.pdf
Busse, R., Blümel, M., & Spranger, A. (2017). Das deutsche Gesundheitssystem: Akteure, Daten, Analysen.
Berlin: MWV.
G-BA. (2017). Bedarfsplanungsrichtlinie. BAnz AT 31.05.2017 B2 .
Martini, M., & Ziekow, J. (2015). Rechtliche Möglichkeiten und Grenzen der Einführung und Ausgestaltung
einer Quote zur Sicherstellung der Primärärztlichen Versorgung, insbesondere im ländlichen Raum, bei
der Zulassungg zum Medizinstudium. Bundesministerium für Gesundheit.
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bewerbungsverfahren-fuer-medizinstudienplaetze-gestartet
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Selected Health Care Sectors, Abridged Version.
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Sundmacher, L., Flemming, R., Franke, S., Höser, C., Berg, N. v., Becker, U., . . . Kleinke, F. (2018).
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vertragsärztlichen Versorgung. Munich, Leipzig, Bonn, Greifswald and Cologne: Gemeinsamer
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31

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Sustainability and Resilience in the

German Health System

John Grosser and Wolfgang Greiner,

(T) +44 (0)20 7106 1198

1. Health System Governance 7

2. Health System Financing 9

4. Medicines and Technology 14

Annex I. Case Study – Digitalisation 25

Annex II. Case Study – Rural Healthcare 28

Table 1: Key Findings of the German PHSSR Report

Domain Sustainability Resilience

Governance Key governance sustainability factors in Germany’s response to COVID-19 was

Hospital investments by the Länder are

There are significant legal hurdles to

regular and systematic economic cost- have a national reserve of medicines,

Germany remains an important location Germany is relatively independent of non-

Chronic disease prevention efforts are an

Table 2: Key Recommendations of the German PHSSR Report

Domain Sustainability Resilience

Governance Recommendation 1A: Reform of planning Recommendation 1B: Prioritising local

Recommendation 2B: Reforming the DRG

Workforce Recommendation 3A: Ensuring an Recommendation 3C: Increased

Medicines & Recommendation 4A: Incorporating Recommendation 4C: Increasing

Service Recommendation 5A: Structural reforms Recommendation 5D: Measures aiming

Recommendation 5C: Empowering

1. Health System Governance

1.2 Governance Resilience

1.3 Governance Recommendations

2. Health System Financing

Table 1: Funding indicators of financing sustainability, 2010-2019

Table 2: Spending indicators of financing sustainability, 2010-2019

Table 3: Demographic and government debt indicators of financing sustainability, 2010-2019

2.2 Financing Resilience

2.3 Financing Recommendations

Table 4: Profession size indicators of workforce sustainability, 2008-2017

Table 5: Working condition indicators of workforce sustainability, 2017/2019

Working Condition Indicator

3.2 Workforce Resilience

3.3 Workforce Recommendations

4. Medicines and Technology

4.2 Digital Health and Sustainability in Germany

4.3 Medicines and Technology Resilience

4.4 Medicines and Technology Recommendations

5.2 Service Delivery Resilience

5.3 Service Delivery Recommendations

Arnold, N. (2020). Wissenschaftliche Politikberatung zur gesundheitlichen Bewältigung der Corona-

BMG. (2018, October 18). Gesetze und Verordnungen: GKV-Versichertenentlastungsgesetz (GKV-VEG).

Destatis. (2019). Statisches Jahrbuch 2019. Berlin: Statistisches Bundesamt.

Destatis. (2020b). Gesundheitsausgaben 1992-2018. Retrieved November 5, 2020, from https://www-

Destatis. (2020c). Gesundheitspersonalrechnung. Retrieved November 5, 2020, from https://www-

Deutscher Hausärzteverband. (2020). Hausarztverträge. Retrieved from Deutscher Hausärzteverband:

Gerlof, H. (2020, November 12). Videosprechstunde: Gekommen, um zu bleiben. ÄrzteZeitung.

OECD. (2019). Health at a Glance 2019. OECD.

PKV. (2017). Altersrückstellungen in der PKV.

RKI. (2020a). Ergänzung zum Nationalen Pandemieplan - COVID-19 - neuatige Coronaviruserkrankung.

Schulz, B. (2020). Kramp-Karrenbauer rechnet mit langem Bundeswehreinsatz. Spiegel Politik.

Universitätsklinikum Heidelberg; Goethe-Universität Frankfurt am Main. (2018). Evaluation der

Annex I. Case Study – Digitalisation

Key Findings, Recommendations and Limitations

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