Redefining German Health Care: Moving to a Value-Based System


The German health care system is on a collision course with budget realities. Costs are high and rising, and quality problems are becoming ever more apparent. Decades of reforms have produced little change to these troubling trends.

Why has Germany failed to solve these cost and quality problems? The reason is that Germany has not set value for patients as the overarching goal, defined as the patient health outcomes achieved per euro expended.

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The German health care system is on a collision course with budget realities. Costs are high and rising, and quality problems are becoming ever more apparent. Decades of reforms have produced little change to these troubling trends.

Why has Germany failed to solve these cost and quality problems? The reason is that Germany has not set value for patients as the overarching goal, defined as the patient health outcomes achieved per euro expended.

This book lays out an action agenda to move Germany to a high value system: care must be reorganized around patients and their medical conditions, providers must compete around the outcomes they achieve, health plans must take an active role in improving subscriber health, and payment must shift to models that reward excellent providers. Also, private insurance must be integrated in the risk-pooling system.

These steps are practical and achievable, as numerous examples in the book demonstrate. Moving to a value-based health care system is the only way for Germany to continue to ensure access to excellent health care for everyone.

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Editorial Reviews

From the Publisher
We must thank the authors of Redefining German Health Care for changing the language of the current health care debate. Their book makes a passionate argument for moving the health care discussion beyond cost control, health insurance premiums and risk pooling. It is health outcomes that matter to patients, not insurance premiums per se.

Prof. Dr. Dr. Dr. Eckhard Nagel, Institute for Medical Management and Health Sciences University of Bayreuth and Chief Medical Officer University Hospital Essen, Germany

The introduction of competition among health insurances in Germany was successful. However, it is long overdue to instil value-adding competition to the provider side. This is convincingly demonstrated by Michael Porter and Clemens Guth in their excellent adaption of the original Redefining Health Care book.

Prof. Dr. Norbert Klusen, Chief Executive Officer Techniker Krankenkasse, Hamburg, Germany

In the book Redefining German Health Care, Michael Porter and Clemens Guth establish clear, actionable steps which providers and health plans should take to maximize patient value. They argue that every provider should focus their service lines, measure outcomes and organise integrated care around medical conditions. This book is inspiring and a must read for health care managers.”

Prof. Dr. Karl Max Einhäupl, Chief Executive Officer Charité – Universitätsmedizin, Berlin, Germany

Physicians and provider organizations must make outcome measurement core to their activities. Outcome measurement demonstrates that not the volume but the results of care matter. Superior providers will benefit from transparency of results, either through pay-for-performance or simply through more patients. Redefining German Health Care shows us convincingly how we can embark on this course.

Professor Dr. Dr. h.c. Peter C. Scriba, Chairman of the Research Board of the German Medical Association, former Vice-President of Health Care Advisory Council and Chief Medical Officer of Ludwig-Maximilians-University Hospital, Munich, Germany

The book “Redefining German Health Care” by Michael Porter and Clemens Guth provides a fact-based analysis of the development of the German health care system. On the one hand, the analysis and assessment demonstrates the system’s substantial achievements (also with respect to other countries), while, on the other hand, it speaks clearly about the system’s shortcomings, which are highlighted by concrete examples. The reader is presented with logical arguments for structurally changing the health care system, building on the already achieved benefits. Both authors rightly assume that better quality in conjunction with appropriate financing and incentive schemes will lead to higher cost efficiency, as shown in other industries. The system will not improve without an honest debate over the current system’s challenges. This book makes a significant contribution to that process.

Prof. Dr. Jürgen Wettke, Director Healthcare Practice McKinsey & Company, Duesseldorf, Germany

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Product Details

  • ISBN-13: 9783642430848
  • Publisher: Springer Berlin Heidelberg
  • Publication date: 8/11/2014
  • Edition description: 2012
  • Pages: 308
  • Product dimensions: 6.14 (w) x 9.21 (h) x 0.68 (d)

Meet the Author

Michael E. Porter is a leading authority on competitive strategy and the competitiveness of countries, regions, and cities, and the application of strategic principles to societal problems. Based at Harvard Business School, his ideas and personal leadership have influenced countless governments, companies, and scholars across the globe. Professor Porter’s thinking on strategy is taught in virtually every business school in the world, and his work on competitiveness is an integral part of modern economic development theory and practice.

Professor Porter’s work on health care dates back more than a decade. His seminal book, Redefining Health Care, has shaped the new field of value-based health care delivery. The book, together with a series of additional publications, is successfully inspiring change in health care providers and governments across the globe.

An aerospace engineering graduate of Princeton, Professor Porter has an M.B.A. from the Harvard Business School, where he was a George F. Baker Scholar, and a Ph.D. in business economics from Harvard University. He has received numerous awards and honors, including six McKinsey Awards for the best Harvard Business Review article of the year, national honors in a number of countries, and the highest award of the Academy of Management for scholarly contributions to management.

Clemens B. Guth is the CEO of two private hospitals owned by Artemed Kliniken, a German national hospital provider. In addition to hospital operations, he is responsible for M&A and quality management across Artemed. Previously Dr. Guth worked as a health care consultant for McKinsey & Company. His client work included studies for German hospital groups, statutory and private health plans as well as regional outpatient associations. Before joining McKinsey & Company, he started his professional career as a Junior Doctor at the Chelsea & Westminster Hospital in London.

Dr. Guth earned an M.B.B.S. from the Imperial College Medical School, London, and an M.B.A. from Harvard Business School. He was awarded honors and prizes for both degrees. He is a scholar of the German National Academic Foundation and the German Academic Exchange Service program. For several years, Dr. Guth has published scholarly contributions on health care subjects.

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Table of Contents

Introduction.- Defining the Problem.- Guiding Principles of a Value-Based Health Care System.- The German Health Care System: Overview and Historical Development.- Health Insurance in Germany.- Health Care Providers.- Overall Assessment of German Health Care Providers.- The Role of Health Plans, Employers and Patients in Health Care Delivery.- Measuring the Results of Care.- Creating a High-Value German Health Care System: Overall Assessment and Recommendations.- Taxonomy of BQS Quality Indicators.

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