Compulsory Insurance for All: Health Care Reform as an Entry into the Totalitarian Welfare State?

The renewed compromise on health reform again raises serious doubts about the feasibility of the result: Compulsory health insurance for all (as an introduction to general citizens’ insurance) is now intended to allay the concerns of private health insurance (PKV) that the basic tariff will only be selectively taken out by the uninsured only when they become ill. Above all, compulsory insurance for all seems constitutionally questionable. Finally, the private autonomy of the citizen is curtailed more than necessary. What does “for all” mean: all Germans, all employed persons and their relatives, all those living here and all those entering Germany, or at least all those whom the German justice system can apprehend? For foreign aupairs, compulsory health insurance has been a reality for decades – according to the level of benefits, premiums start at 22 euros per month. The basic tariff, however, at a high benefit level of the statutory health insurance for all would be allowed to cost up to 530 euros per month.

It is unclear whether alternative hedges that exist today will still be permissible in the future.

Will you be denied a work permit or business registration or receive a fine if you do not adequately comply with your insurance obligation? May a health insurance policy no longer be cancelled by either party, even if one does not pay the premiums? In private compulsory long-term care insurance, for example, late payment alone already does not lead to termination – the deficits are then compensated within the private health insurance. There are, for example, police or firefighters who are entitled to so-called “Heilfürsorgeberechtigte”, which means that they are fully covered in the event of illness – today they have no health insurance at all.

The Krankenversorgung der Bundesbahnbeamten (KVB) and the Postbeamtenkrankenkasse are neither social health insurance funds nor private insurance companies – those insured against illness there require neither statutory nor private health insurance. Also the “Werk gegenseitiger Hilfe im Verein Pfälzi- scher Pfarrerinnen und Pfarrer e.V.”, the professional association of pastors of the Protestant Church of the Palatinate and many others comparable are as social self-help institutions neither statutory nor private health insurance. The Insurance Supervision Act explicitly exempts them from insurance supervision. Will these alternative insurances remain permissible in the future or will those concerned be forced under the newly introduced general health insurance obligation, possibly in private health insurance?


“Politics for 82 Million People” also offers remarkable potential for going all the way to the Constitutional Court.”

The question then arises as to whether the scope of compulsory health insurance cover is also prescribed. An obligation without any prescribed minimum scope would practically run into the void – therefore, for example, in the motor vehicle liability insurance, a statutory minimum scope is also mandatory, without which a motor vehicle is even compulsorily immobilised. If in the future one has to take out health insurance only to the extent that it does not correspond to the amount but only to the type of statutory health insurance (as is sufficient for the employer’s allowance), then, for example, only outpatient services with a 20,000 euro deductible and possibly with further exclusions will suffice. If, however, the minimum level is prescribed, then further constitutional concerns arise – just as they have already been expressed against the basic tariff going beyond an absolute minimum level. The constitutional lawyer will look at every compulsory service component, and for each of them the question of the prohibition of excess will arise, from the point of view of the citizen: “Politics for 82 million people” also means a remarkable potential for going all the way to the Constitutional Court. Even a complaint in only one instance is sufficient to suspend the proceedings and to appeal to the Constitutional Court if the judge considers the statutory provision to be unconstitutional.

If a comprehensive minimum scope becomes obligatory, many people with private health insurance today would have to top up their insurance at great expense.

If a comprehensive minimum scope becomes obligatory, many people with private health insurance today would have to increase their insurance at high cost, for whom a lower level of protection has been sufficient up to now. But is dental prosthesis really an existential life risk that cannot be financed by anyone and against which everyone would have to take out compulsory insurance? Even the statutory health insurance only pays a percentage subsidy here, which is also based on the most economical health insurance version. Doctors do not necessarily need protection against outpatient doctors’ fees and pharmacists do not need protection against pharmaceutical costs, dentists do not need protection against dental treatment costs or dental prostheses – as can be seen from corresponding private health insurance offers. And for glasses, the legislature has already determined that everyone can well pay for them themselves, and has therefore largely removed them from the benefits catalogue of the GKV. Civil servants receive an allowance from their employer in the event of illness: up to now, the general legal opinion has been that civil servants are free to take out additional insurance cover, e.g. through their own assets instead of additional private insurance.

Should he now be required to take out 100 percent private insurance to cover the entire difference? This can also be a constitutionally intolerable special sacrifice on the part of the private health insurers, because the obligation to accept customers who are no longer insurable in private health insurance today often means certain losses for the insurer – the limit of the social obligation of property may thus have been exceeded. Civil servants who are willing to sue will also oppose such disenfranchisement, possibly all the way to the Federal Constitutional Court. Those insured by the KVB (Krankenversorgung der Bundesbahnbeamten) receive 90 to 100 percent reimbursement from there. Most people insured there do not have and do not need any additional private cover – should this no longer be sufficient in future?

Aid is not only available in the public sector, but also from other employers. It is – as an alternative to compulsory social insurance – expressly provided for under SGB V, for example for teachers at private schools, is also practised to a large extent and is even promoted by the state within the framework of the constitutionally required financing of private schools. The abolition of this possibility to allow teachers at increasingly sought-after private schools comparable conditions as for teachers at public schools would perhaps even interfere with the constitutionally explicitly prescribed right to exist of these school forms, because it would become more difficult for them to recruit suitable teachers – at conditions comparable to the public service. Should such possibilities of more liberal voluntary provision for illness be abolished?


The suspicion arises that new sinecures are to be secured for private health insurance as a substitute for lost market opportunities.
The suspicion arises that, as a substitute for lost market opportunities, new sinecures are to be secured for private health insurance by forcing additional groups of people who had previously been insured elsewhere to take out private health insurance with an extensive minimum scope that was not required – at the expense of previously widespread liberal other forms of cover. Perhaps this will mean that even today privately insured persons will be forced to increase their insurance to the new minimum level. Nevertheless, experts expect that some private health insurance providers will be forced to withdraw from the market for economic reasons. This raises far-reaching practical implementation questions and constitutional concerns. For example, the questions of equal treatment and the limits of permissible expropriation are affected. Compulsory insurance “for all” – and this only in statutory or private health insurance – now also affects wide areas of currently existing models outside these two forms of insurance, the abolition of which raises new constitutional concerns. If the state presses all citizens indiscriminately into a new compulsory system of collective compulsory insurance, no matter how well-meaning the reasons, this is a further step on the road to a totalitarian welfare state.


by Dr. Johannes Fiala and Dipl.-Math. Peter A. Schramm

by courtesy of (published in CHAZ 1/2007, page 1; CHAZ 2/2007, page 53)

and (published in Landpost 4/2007, page 25)

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Dr. Johannes Fiala Dr. Johannes Fiala

Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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