German Public Health Insurance : Higher Co-payments and Everybody Is Better Off - The Case for Differentiated Co-payment Rates

Higher co-payments in health insurance systems may lead to a reduced demand for health care services, but may impose an additional financial burden on persons of low income and/or high health care costs. For the case of the German public health insurance, the article tries to show that a system of - rightly adjusted - differentiated co- payment rates might make every insured financially better off while reducing considerably the contribution rate and, thus, labour costs.