Indicators for Measuring Intergenerational Fairness of Social Security Systems—The Case of the German Social Health Insurance

Fetzer, Stefan; Moog, Stefan

doi:10.3390/su13105743

Cited by 5 publications

(3 citation statements)

References 48 publications

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“…Other studies also show that the amount of cost-increasing innovations strongly varies between different diseases [ 29 , 52 ]. In turn, these are expected to develop very differently within demographic change [ 53 , 54 ]. Thus, future pharmaceutical spending will be influenced by several factors whose interaction should be explored in more detail.…”

Section: Discussionmentioning

confidence: 99%

How to Predict Drug Expenditure: A Markov Model Approach with Risk Classes

2023

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Background Although pharmaceutical expenditures have been rising for decades, the question of their drivers remains unclear, and long-term projections of pharmaceutical spending are still scarce. We use a Markov approach considering different cost-risk groups to show the possible range of future drug spending in Germany and illustrate the influence of various determinants on pharmaceutical expenditure. Methods We compute different medium and long-term projections of pharmaceutical expenditure in Germany up to 2060 and compare extrapolations with constant shares, time-to-death scenarios, and Markov modeling based on transition probabilities. Our modeling is based on data from a large statutory sickness fund covering around four million insureds. We divide the population into six risk groups according to their share of total pharmaceutical expenditures, determine their cost growth rates, survival and transition probabilities, and compute different scenarios related to changes in life expectancy or spending trends in different cost-risk groups. Results If the spending trends in the high-cost groups continue, per-capita expenditure will increase by over 40% until 2040. By 2060, pharmaceutical expenditures could more than double, even if these groups would not benefit from rising life expectancy. By contrast, the isolated effect of demographic change would "only" lead to a long-term increase of around 15%. Conclusion The long-term development of pharmaceutical spending in Germany will depend mainly on future expenditure and life expectancy trends of particularly high-cost patients. Thus, appropriate pricing of new expensive pharmaceuticals is essential for the sustainability of the German healthcare system. Supplementary Information The online version contains supplementary material available at 10.1007/s40273-023-01240-3.

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Section: Discussionmentioning

confidence: 99%

How to Predict Drug Expenditure: A Markov Model Approach with Risk Classes

2023

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“…Although other approaches exist for assessing fiscal sustainability, such as the Organisation for Economic Co-operation and Development (OECD) method by Blanchard et al (1990) or the concept of Settergren and Mikula (2005), we choose the generational accounting framework as it is regularly applied to German LTC insurance. As Fetzer and Moog (2021) highlight, all approaches lead to similar implications. 15.…”

Section: Methodsmentioning

confidence: 98%

Curbing the demographic “drifting dune” in long‐term care insurance financing: The case of Germany

Bahnsen

Wimmesberger

2023

Int Social Security Review

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Long-term care provision and financing are becoming increasingly important matters in all ageing economies. Therefore, a major challenge for policy makers is to strike a balance between adequate care and sustainable financing. In this study, we evaluate the proposal of a so-called sustainability factor in German long-term care insurance. Considering changes in the beneficiary-contributor ratio, it aims for a rule-based consideration of demographic dynamics to alleviate pressure on long-term care financing. Using the framework of generational accounting, we demonstrate that this proposal could have a relieving effect on finances, depending on the share of involvement of current and future generations. It may offer an option for pay-as-you-go long-term care insurance systems worldwide that need to curb the impact of ageing societies. Therefore, this article addresses policy makers tasked with designing a sustainable financing model for long-term care insurance. It demonstrates that the sustainability factor represents a step

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“…), an index used for social security programs 4 and recently to health systems. 5 Solvency ratio is calculated as the present value of future assets and liabilities. If yearly S.R.…”

Section: Introductionmentioning

confidence: 99%

Sustainability of Healthcare Financing in Greece: A Relation Between Public and Social Insurance Contributions and Delivery Expenditures

Mavridoglou

Polyzos

2022

INQUIRY

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The economic crisis in Greece, which began in 2010 and lasted for 10 years, highlighted the serious problems and challenges of the Greek Social Health Insurance system. The reforms that mainly took place during the crisis provided a temporary solution. They focused on establishing a new National Organization for Healthcare Services (named EOPYY) and merging all the old insurance funds. This paper aims to examine whether this social health insurance fund has been sustainable in the long run. An actuarial model was created to project future expenses and revenues. Demographic and economic trends were considered, while it was assumed that medical technology remains unaltered. The assessment of the system solvency was based on the ratio (Revenue/Liabilities) calculated for each year, from 2020 to 2050. The results led to deficits, the amount and the time point in which they appear depends on how optimistic or pessimistic demographic and economic assumptions were. A new financial flow model was proposed to address the deficits. The results show that under the new model, the system remains solvent until 2050. The state subsidy amount on the employees’ health insurance premium was estimated as a percentage of the employees’ wage.

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Indicators for Measuring Intergenerational Fairness of Social Security Systems—The Case of the German Social Health Insurance

Cited by 5 publications

References 48 publications

How to Predict Drug Expenditure: A Markov Model Approach with Risk Classes

How to Predict Drug Expenditure: A Markov Model Approach with Risk Classes

Curbing the demographic “drifting dune” in long‐term care insurance financing: The case of Germany

Sustainability of Healthcare Financing in Greece: A Relation Between Public and Social Insurance Contributions and Delivery Expenditures

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