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2018 Report – Funding of ground and air rescue transport services

Aug 20, 2018

0 Executive Summary

The German SAI audited the funding of ground and air rescue transport services provided to statutory health insurance enrolees. We have confirmed the following findings as final.

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The federal states and the municipalities are responsible for providing rescue services. They decide about establishing ambulance stations and air rescue stations. In its financial provisions, the German Constitution generally imposes funding responsibility for rescue services on the federal states. However, the statutory health insurers have the statutory duty to pay the transport costs where such transport is needed to provide urgent health-related services for compelling medical reasons. There are no detailed legal provisions in place to determine the amount of those transport costs. The federal states and municipalities apportion the costs to the statutory health insurers by way of fees and user charges. In recent decades, they have continuously reduced funding of rescue services. As a result, statutory health insurers do not only bear transport costs but also provide almost all funding needed to maintain and deploy ambulance cars and rescue helicopters. Still, health insurers have practically no say on procurements and locations of ambulance or air rescue stations. Their expenditures on ground and air rescue transports have risen considerably in the last 25 years. They totalled €3.5 billion in 2017.

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Divergent responsibilities for providing and funding rescue services are likely to encourage inefficient decisions. We recommend that the costs to be borne by the statutory health insurers are clearly separated from the costs to be borne by the federal states. At the same time, the statutory health insurers should be given participation rights commensurate with their funding share. In order to ensure that the statutory health insurance enrolees are not imposed the costs for setting up and maintaining the rescue services, the federal states should be involved at an early stage in any initiatives designed to revise cost sharing arrangements.

Rescue services: Costs frequently passed on to statutory health insurers

Rescue services are jointly funded by the federal states, the municipalities and the statutory health insurers. However, the statutory health insurers are increasingly burdened with these costs. This is the result of work the German SAI did on the funding of ground and air rescue transport services.

“Each year, statutory health insurers pay €3.5 billion from enrolees’ funds and federal funds for rescue services, while the federal states and municipalities have more and more withdrawn from funding. This practice neither complies with applicable legislation nor does it promote efficient management. It burdens the community of the insured” said Kay Scheller, President of the German SAI when issuing the report to the Budget Committee of the German Parliament.

In the last 25 years, the expenditures of the statutory health insurers for transport by ambulance cars and rescue helicopters have increased from € 700 million to € 3.5 billion. Although the federal states also need to fund part of this, several states have for years stopped  funding ground rescue services and now apportion all costs to the statutory health insurers. Other federal states have reduced their funding significantly.

The German constitution stipulates that the federal states shall provide rescue services. In line with legislation in each respective federal state, municipalities fund ground rescue services and the states fund airborne rescue services. This also includes capital expenditure on establishing and operating ambulance stations or air rescue stations and staff expenditure.

Statutory health insurers shall fund the transport costs where such transport is needed to provide urgent health-related services for compelling medical reasons. However, transport costs are not precisely defined. Charging practices differ widely among federal states.

These disincentives especially arise because the federal states and municipalities decide about the infrastructure of rescue services, but the costs are primarily borne by the statutory health insurers. For instance, new air rescue stations have been set up in recent years. It is doubtful whether the decisions for setting them up were always driven by demand and capacity utilisation needs.

The Federal Government and the federal states should establish clear rules on the funding of rescue services, especially what the term transport costs comprises. Where statutory health insurers share in the funding of rescue services, they should in future be adequately involved in key organisational management decisions.

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