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ORIGINAL RESEARCH Pharmacoeconomics 2006; 24 Suppl. 2: 59-68 1170-7690/06/0002-0059/$39.95/0 © 2006 Adis Data Information BV.All rights reserved. Background: At least in Germany, it is widely assumed that healthcare-relat- ed labour costs weaken the competitiveness of national industries. However, there is a lack of knowledge about the amount of employers’ financial burden in Germany and in other competing countries, as well as the impact on market prices of German goods. Objective: To quantify the health-related labour costs for employers in seven countries and different industries, and identify the effects of current reforms in Germany on the financial burden of employers. Methods: We calculated the spending on health in Germany and the burden on German employers (by branch of production). We then compared the total bur- den with that of six other countries. A univariate analysis was then conducted to examine the connection between health-related labour costs and employment. Results: In 2000, employers paid 41.2% of the total of 283.3 billion spent on health matters in Germany. These total costs account for 3.2% of the gross out- put (UK: 1.8%, Switzerland: 1.9%, Poland: 2.1%, US: 3.2%, France: 3.6%, The Netherlands: 3.7%). Health-related labour costs account for 10.6% of the total labour costs. The health-related labour costs per employee are on average 3013 (from 2752 to 4793 in healthcare and the chemical industry, respectively). In the UK and the US there are corresponding labour costs of 1836 and 4256 per employee, respectively. The current health reform (2003) would reduce the labour costs by only 0.7% after 4 years (based on 2000, with all factors remaining constant). Employment increased by 3.7% from 1995 to 2000 (textile industry: –26.8%, vehicle manu- facture: +18.3%). There is no empirical connection between employment and health-related labour costs. Labour costs increased by a higher amount than the health-related labour costs. Conclusions: The burden on German employers is moderate when compared internationally. The current reform of the German health system is not expect- ed to improve companies’ financial situation or German competitiveness. Restrictions on the range of medical services would provide a relatively small amount of relief for employers. Abstract Do Health-Related Labour Costs Weaken the Competitiveness of the Economy? Bertram Häussler, 1 Thomas Ecker 1 and Markus Schneider 2 1 IGES Institut für Gesundheits- und Sozialforschung, Berlin, Germany 2 BASYS Beratungsgesellschaft für angewandte Systemforschung mbH, Augsburg, Germany

Do Health-Related Labour Costs Weaken the Competitiveness of the Economy?

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ORIGINAL RESEARCH Pharmacoeconomics 2006; 24 Suppl. 2: 59-681170-7690/06/0002-0059/$39.95/0

© 2006 Adis Data Information BV. All rights reserved.

Background: At least in Germany, it is widely assumed that healthcare-relat-ed labour costs weaken the competitiveness of national industries. However,there is a lack of knowledge about the amount of employers’ financial burdenin Germany and in other competing countries, as well as the impact on marketprices of German goods.Objective: To quantify the health-related labour costs for employers in sevencountries and different industries, and identify the effects of current reforms inGermany on the financial burden of employers.Methods: We calculated the spending on health in Germany and the burden onGerman employers (by branch of production). We then compared the total bur-den with that of six other countries. A univariate analysis was then conducted toexamine the connection between health-related labour costs and employment.Results: In 2000, employers paid 41.2% of the total of €283.3 billion spent onhealth matters in Germany. These total costs account for 3.2% of the gross out-put (UK: 1.8%, Switzerland: 1.9%, Poland: 2.1%, US: 3.2%, France: 3.6%, TheNetherlands: 3.7%). Health-related labour costs account for 10.6% of the totallabour costs. The health-related labour costs per employee are on average €3013(from €2752 to €4793 in healthcare and the chemical industry, respectively). Inthe UK and the US there are corresponding labour costs of €1836 and €4256 peremployee, respectively.

The current health reform (2003) would reduce the labour costs by only 0.7%after 4 years (based on 2000, with all factors remaining constant). Employmentincreased by 3.7% from 1995 to 2000 (textile industry: –26.8%, vehicle manu-facture: +18.3%). There is no empirical connection between employment andhealth-related labour costs. Labour costs increased by a higher amount than thehealth-related labour costs.Conclusions: The burden on German employers is moderate when comparedinternationally. The current reform of the German health system is not expect-ed to improve companies’ financial situation or German competitiveness.Restrictions on the range of medical services would provide a relatively smallamount of relief for employers.

Abstract

Do Health-Related Labour Costs Weakenthe Competitiveness of the Economy?Bertram Häussler,1 Thomas Ecker1 and Markus Schneider2

1 IGES Institut für Gesundheits- und Sozialforschung, Berlin, Germany

2 BASYS Beratungsgesellschaft für angewandte Systemforschung mbH, Augsburg, Germany

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Background

Unemployment has been increasing continu-ously in Germany for years and greatly exceedsthe level in other countries. Thus, in 2003, 9.5% ofthe civilian population capable of gainful employ-ment were registered as unemployed, comparedwith 5.5% in the US and 4.7% in the UK – twocountries with very differently organised healthsystems.

The reason given for the unemployment, incalculations of microeconomic demand, is thelevel of labour costs. Particular attention is paid inpolitical discussions to those labour costs that canbe influenced by politicians, and not by employersand employees. Among the politically influencedancillary labour costs, most attention is paid tohealth spending. It is a widely held political viewin the health field that reorganising the insurancearrangements for covering the cost of sickness canreduce unemployment.

However, the debate on the costs of the healthsystem and the resultant spending throughout theeconomy is not restricted to Germany. This is whythe American automobile industry regards healthspending as one of the central causes of its crisis.The debate on healthcare rationing conducted incountries with a state-run health system (such asthe UK) also focuses on economics and the coststhat have to be borne by the economy.

Status of Research

According to economic theory, the demandfor work depends on a large number of factors, notjust the price of labour.[1] If just the volume ofdemand and the price are considered, an inverseconnection is seen: if the price of labour falls andall other factors remain constant (‘ceterisparibus’), additional employment is expected. Thereason for this is the profit maximisation calcula-tion, according to which labour costs cannotexceed the marginal revenue product for the lastlabour unit. If the threshold yield falls withincreasing deployment of labour (Wicksel CobbDouglas production function[2]), there is a volume

of labour that offers maximum profit. This increas-es with reduced labour costs and decreases withhigher labour costs. If employees do not consideremployers’ health-related benefits to be part oftheir remuneration, even though they representadditional labour costs for employers, a reducedsupply of work must be expected as a result.

If an employer’s contribution is introducedinto the health insurance, the demand for workonly stays constant if these additional costs can becompensated by the employer through a lowergross pay. But if employees do not regard theemployer’s contribution as a part of the overallremuneration, although it creates additional labourcosts, the appeal for labour supply for them is min-imised by this reduction in pay. In this case,health-related burdens on employers have theeffect of reducing employment.

This theoretical interrelation is confirmed byempirical studies.[3,4] Much the same applies to theconnection between the supply of work and thelevel of pay.[5] However, when assessing the over-all economic effects on employment, account mustbe taken not only of the microeconomic relief oflabour costs but also of possible effects in the otherdirection produced by less demand in the healthsystem.

The level of welfare contributions internation-ally[6,7] and its connection with employment hasfrequently been studied, especially by Germanauthors (for an overview see Scharpt andSchmidt[8] and Kemmerling[9]). Because of thedouble role of the health service as a source ofcharges and as an economic sector, the results ofgeneral charges studies must not be applied uncrit-ically to the health service. However, to date, therehave been no studies of the specific role of health-related burdens on employers, despite the rele-vance of the subject to health policy.

Objective and Methods

Three questions are examined in this study:1. What is the level of health-related financial burden

on employers in Germany and internationally?2. What are the effects on health-related labour

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costs of current reforms within the Germanhealth system?

3. Is there a discernible connection betweenhealth-related labour costs and employment?

The method follows the structure of the ques-tions raised. Subsequent sections describe themethod used to quantify the financial burden, theburden on German employers and a comparisonwith other countries, a calculation of the relief foremployers that can be expected from the latesthealth reforms in Germany, and the connectionbetween the health-related burden on employersand employment. Conclusions are given in thefinal section.

Short Description of the GermanHealthcare System

Contributions to the statutory health insurancesystem GKV (Gesetzliche Krankenversicherung)form the largest contribution to the funding of theGerman health system. The GKV also determinesthe manner in which all healthcare is provided.

At present, about 88% of the population areinsured in the GKV. Of these, 74% are compulso-ry members or their relatives; voluntary membersand their relatives account for the remaining 14%.About 9% of the population are covered by privatehealth insurance.

Contributions to the GKV are calculatedaccording to the income of the insured member,and are shared between employers and employees;relatives are usually insured free of charge. Bycontrast, premiums in the private health insurancesystem PKV (Private Krankenversicherung) arecalculated using actuarial principles.

The benefits of the GKV consist of the provi-sion of preventive care, screening examinations,treatment and medically necessary transportation.Health insurance funds also provide income sup-port in case of illness.

Treatment benefits also include nonmedical,outpatient services such as psychotherapy, physio-therapy, speech therapy and occupational therapy.In one area of benefits, nursing care, there is con-siderable overlap between GKV and statutory

nursing-care insurance, since both of them financebenefits of this kind.

Data and Methods

Identification of Health-Related LabourCosts

The contributions made by employers to thestatutory health insurance scheme are the bestknown part of the health-related labour costs, butthey are by no means the only one. A basic dis-tinction must be made between health benefitsfinanced directly by employers (such as sicknessbenefit or social assistance) and benefits whereemployers make a financial contribution to institu-tions, which in turn pay for health benefits. Thisindirect financing with separation from the financ-ing party (the employer, among others) and thepayer (such as the health insurance scheme) is alsocalled secondary level financing. This includes notonly the health insurance contributions paid byemployers but also the contributions paid to other(social) insurance institutions which in turnfinance health benefits (such as nursing-care insur-ance and accident insurance), plus tax-financedhealth benefits (such as the state health service).

A comprehensive analysis of the health-relat-ed burden on employers must take account of allthe forms of burdens specified here, because dif-ferent sources of financing may dominate, depend-ing on the health system. Therefore, for example,an analysis restricted to health insurance contribu-tions would not adequately reflect the true situa-tion in some countries.

The term health benefits is defined broadly inthis study. Health benefits include, besides med-ical and nursing benefits, the products, cash bene-fits, administrative services, investments, researchand development, and training used in this con-nection.

The calculation of health-related labour costsis based on the Organisation for Economic Co-operation and Development’s health expenditurecalculations[10] and breaks these costs down into(secondary) items of expenditure. Spending by

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institutions financed from taxes or contributionsfrom private households or companies are includ-ed according to their share in the financing, e.g.contribution-financed health spending accordingto the number of private households and employ-ers involved in providing the financing. For thesake of simplicity, when dividing up tax-financedbenefits it is assumed that direct taxes are paid byemployers and indirect taxes by private house-holds.

The burden on employers is shown as anabsolute quantity per employee and in relation tovarious economic indicators. The main focus is onthe value of output. By contrast to value added(GDP), the term gross output refers not just tonewly produced values but also to the total valueof all the goods and services produced. Gross out-put includes all intermediate services. The rela-

tionship to this quantity thus shows the amount bywhich products would fall in price if health-relat-ed labour costs were to fall by a particular amount.The reference year for all calculations is 2000, forwhich international comparisons are available.Changes are also shown by comparison with 1995.

Analysis

The empirical connection between health-related labour costs and employment is describedin terms of a univariate analysis. A broader multi-variate regression calculation is of no value giventhe shortness of the observation period (1995-2000) and the small number of country-specificand sector-specific observations. The multifactori-al assessment is therefore made via a presentationof known model calculations.

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Fig. 1. Financing structure of health spending in Germany in 2000 (€ in billions); deviations between health spending and indi-vidual items are due to rounding. R&D = research and development.

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Results

National

Out of the total of €283.3 billion spent inGermany on health matters in 2000, €116.8 billion(41.2%) is paid by employers (figure 1).

Of the total health-related labour costs inGermany, €45.2 billion (38.7%) is accounted forby contributions paid to the statutory health insur-ance system. The second largest item is continuedpayment of earnings when employees are ill, with€30.6 billion (26.2%); €28.1 billion is paid toother insurance systems. Tax payments andemployers’ direct benefits account for a further€12.9 billion.

Health-related labour costs account for 3.2%of the total value of all the goods and services pro-duced in Germany, i.e. €3650.5 billion (gross out-put). Of that, employers’ contribution payments tothe statutory health insurance system account for1.2% of gross output and continued payment ofearnings when employees are ill 0.8%. These fig-ures indicate the potential amount by whichGerman products would theoretically becomecheaper if employers were completely relieved oftheir obligations.

Health-related labour costs account for 10.6%of labour costs in Germany totalling €1100.0 bil-lion, contributions paid by employers to the GKVaccount for 4.1% and continued payment of earn-ings when employees are ill 2.8%.

Referred to gross operating surpluses (includ-ing depreciation) in Germany amounting to €775.0billion, all health-related labour costs amount to15.1% of this figure, contributions paid byemployers to the GKV 5.8% and continued pay-ment of earnings when employees are ill 4.0%.

Five sectors were selected for the assessmentof health-related labour costs at individual sectorlevel, each of which differs as regards branch ofproduction, dependence on exports, economic rel-evance and growth: the chemical industry, vehiclemanufacturing, the textile and garment industry,financial services and healthcare. The sectors cho-sen account for between 15% and 20% of the

German economy, depending on whether theassessment is based on gross output, added valueor employment.

The sector-specific assessment shows that thehealth-related labour costs per employee in theyear 2000 in the sectors examined fluctuatebetween €2752 (health system) and €4793 (chem-ical industry). The average for the German econo-my as a whole is €3013. Since contribution calcu-lations are made on the basis of income, the dif-ferences are also a consequence of the differentsalary structures in the individual sectors. The dif-ferences mean, among other things, that employ-ers in the different sectors in some cases makewidely differing contributions to financing thestatutory health insurance system. This gives riseto considerable transfer payments between thesectors.

The average share of health-related labourcosts in gross output of most of the sectors exam-ined is between 2.1% and 2.7% and is much high-er only in the health service (6.0%). The manufac-turing industries, i.e. the chemical industry, vehi-cle manufacturing and the textile industry, havethe smallest share in gross output, which is bene-ficial as regards their position in internationalcompetition. The health service, on the other hand,where the burden is greatest, is hardly exposed tointernational competition.

International

Six countries were selected as examples forthe international comparison. They either competewith Germany as business locations or have cleardifferences in the way they finance their healthexpenditure: Switzerland, France, TheNetherlands, Poland, the UK and the US. Selectedresults of the international comparison are report-ed below.

Compared with health-related labour costsper employee in Germany of €3013, the burden onBritish employers is much smaller, at €1836. Thecorresponding labour costs in Poland are onlyabout one-tenth of the figure for Germany becauseof the much lower wage levels. The greatest bur-den, on the other hand, is borne by US employers,

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with €4256 per employee.A rather different picture emerges if the share

of health-related labour costs in gross output iscompared for the year 2000: three countries(Poland, Switzerland and the UK) have smallershares (2.1%, 1.9% and 1.8%, respectively) thanGermany (3.2%). The shares for the other coun-tries are larger (France 3.6% and The Netherlands3.7%) or the same (US 3.2%). The burden onemployers can thus be described as moderatewhen compared internationally.

The reason for the differences in burden liesin deviations in the individual level of spendingand in the distribution of the burden. If one takesthe absolute health spending for these countries,assumes the contribution made to primary financ-ing by German employers and then refers this tothe particular gross output, the result is the amountof health-related labour costs for the particularcountry using the German distribution of the bur-den. The difference between this figure and theactual burden can then be used to obtain the par-ticular national level of spending.

The result of this model calculation is shownin figure 2. According to this model, the differ-ences in burden compared to the UK with 1.8%instead of 3.2% of the output value can be ascribed

by 0.5% to the lower level of spending and to 0.9%to the differently bedded allocation of burdenbetween the employers and private households. Incomparison to the US, no differences exist regard-ing the employer’s burden; the slightly higher levelof spending is compensated by a US employer’slower share of burden (measured by the share ofthe whole spending on health at the output value).

Effects of the Health Reform

In discussions of reforms in the health servicein recent years, the primary aim was to reduce theburden on employers and to improve the positionof Germany as a business location.

For the reform decided on in 2003 by the Lawon the Modernization of the Statutory HealthInsurance System GMG (GKV-Modernisierungsgesetz), this study ascertainedthat, when completely effective (i.e. after 4 years),the full relief for employers which was the inten-tion of the law would be a total of €8.0 billion peryear (referred to the situation in 2000). With allother factors constant, this would equate to areduction of 0.7% in labour costs. The total costsborne by a company (expressed as the gross out-put) would be reduced by a maximum of 0.22% asa result. Companies could either pass on this sav-ing to the purchasers of German goods and servic-es or improve their operating surpluses.

Depending on the industry, there are potentialsavings to be made of between €0.37 for an insur-ance policy worth €200 per year and €28.88 for acar costing €20 000.

On the basis of the ratio between the relief foremployers and gross output, this law is not expect-ed to produce any crucial improvements on thecost side for German companies.

Health-Related Labour Costs andEmployment

Employment has shown extremely variedtrends in the industries examined: whereasemployment throughout the German economyincreased by 3.7% between 1995 and 2000 (corre-

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Fig. 2. Identification of determinants for differences in burden(measured by the share of the whole spending on health at theoutput value). CH = Switzerland; D = Germany; F = France;NL = The Netherlands; PL = Poland; UK = United Kingdom;US = United States.

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© 2006 Adis Data Information BV. All rights reserved. Pharmacoeconomics 2006; 24 Suppl. 2

Table I. Comparison of the effects on employment of health policy measures in different simulation models (different reference years)

Study, year(model)

Change examined Effect on employment(selected results)

Special features of model

SVRKAiG,[11]

1996Increase in the level ofcontribution to the GKVof 1% point (given thespecifics of the model, acorresponding reductionin contributions of aboutthe same amount underdifferent circumstances)

+95 773 (closed economy); -25 000 or+35 000 (open economy; financing oftransfers and materialexpenses)

DIW econometric cycle model; health spending goes intothe model as state consumption, i.e. no direct overspend-ing on health benefits; unchanged real exchange rate andstandard wages; no data on period until entry into effect

IAB,[12] 1997 Reduction in contributions to theGKV of 1% point

-90 000 or +50 000 (tax transfers with waiver of other material expenses orincrease in oil tax)a

SYSIFO model[15] medium term (8 years); example usedis unemployment insurance, but in the authors’ viewtransferable to the GKV; however, sector-specific spend-ing effects in the health system (benefits in kind andtransfers) not included for this reason

SVR,[14] 2003(flat-rate premium)

Switch to flat-rate premium

+1.5% or +5.6%(closed economy withpercentage burden limit and financed viasolidarity surcharge orunlimited); -0.5% (open economy,financed via solidaritysurcharge with percentage burdenlimit)

Macroeconomic, intertemporal equilibrium model withoverlapping generations (life-cycle model; 95 years);[16]

not clear which sector-specific spending effects in thehealth system are included (benefits in kind vs transfers)

SVR,[14] 2003(civic insurance)

Broadening of the basison which GKV contributions are calculated

-0.9% or -3.0% (closed economy,includes civil servantsand self-employed)

Macroeconomic, intertemporal equilibrium model withoverlapping generations (life-cycle model; 95 years);[16]

not clear which sector-specific spending effects in thehealth system are included (benefits in kind vs transfers)

Walwei andZinka,[13] 2005(IAB INFORGE)

Reduction in socialsecurity contribution of1%, refinancing via savingsc or rise in VAT

-92 000 or +85 000(savings); +129 000 or+88 000 (increase inVAT)

Sectorally structured macroeconomic model[17] based ontime series (1991-2000); for medium- to long-term esti-mates; values are, however, for exogenous or endoge-nousb wage setting; not clear which sector-specificspending effects in the health system are included (bene-fits in kind vs transfers)

Walwei andZinka,[13] 2005(IAB RWI)

Reduction in socialsecurity contribution of1%, refinancing via savingsc or rise in VAT

-17 000 or +48 000(increase in VAT)

Macroeconomic model without sector specifics,[18] basedon time series (III/1992 to II/2002); for short-term esti-mates (interest exogenous); values in each case forexogenous or endogenous wage setting; not clear whichsector-specific spending effects in the health system areincluded (benefits in kind vs transfers)

Walwei andZinka,[13] 2005(PACE-L)

Reduction in socialsecurity contribution of1%, refinancing via sav-ingsc or rise in VAT

-24 000 or +146 000(savings); -8000 or +65 000 (increase inVAT)

Static equilibrium model, i.e. no time data can begiven;[19] based on microeconomic effect chains; values ineach case for exogenous or endogenous wage setting;not clear which sector-specific spending effects in thehealth system are included (benefits in kind vs transfers)

a Values taken from figure.b Wage trends follow price trends.c Only in the IAB INFORGE model.IAB = Institut für Arbeitsmarkt- und Berufsforschung; DIW = Deutsches Institut für Wirtschaftsforschung; PACE-L = Policy Analysisbased on Computable Equilibrium, Labour market module; RWI = Rheinisch-Westfälisches Institut für Wirtschaftsforschung; SVR= Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung; SVRKAiG = Sachverständigenrat für dieKonzertierte Aktion im Gesundheitswesen; SYSIFO = System for Simulation and forecasting; VAT = value added tax.

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sponding to an extra 1.4 million jobs), the extentof this change differed greatly in individual sec-tors, varying between -26.8% (textile industry)and +18.3% (vehicle manufacture).

Starting from the assumption that health-relat-ed labour costs influence future employment deci-sions, a univariate analysis was made of health-related labour costs in 1995 and the trend inemployment from 1995 to 2000. There is no obvi-ous empirical connection between these two quan-tities for the period under consideration (figure 3).Any increase or decrease in employment in thesectors examined in a particular country evidentlydepends more on other factors than on the burdenborne by employers in the form of health-relatedspending.

An indication of important causes is providedby a comparison with the total labour costs (figure4). It shows that labour costs in all the sectorsexamined and in the economy as a whole

increased by a much larger amount than thehealth-related labour costs. Any potential relief foremployers from the health system can thereforetake effect only if it is not eclipsed by other effects(such as wage policy). Employment is thusdependent on various factors.

To confirm the suspicion that there are multi-ple causes for changes in employment, publishedmodel calculations of the effects on employmentof changes in the German health system wereinvestigated. Three model calculations investigatethe effect on employment of a change in the gen-eral level of contributions to social security,[11-13]

whereas one study[14] examines the effects ofchanges in the basis on which contributions arecalculated (table I).

Comparison of the results from the modelsshows that the results differ considerably accord-ing to the specific features of the model and theeffect chains examined. The particular factors

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Fig. 3. Connection between the percentage change in employment 1995-2000 and health-related labour costs per employee ineuros for 1995

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important for employment seem to be the methodof refinancing selected (altered basis for calculat-ing contributions, tax increase, saving on othergovernment expenditure, waiver of transfer bene-fits or benefits in kind) and the behaviour ofemployers and employees on the labour market.This makes it clear that the effect on employmentthat could really be expected from a smallerhealth-related burden on employers may beeclipsed by other factors.

Conclusion

The study shows that the influence of health-related labour costs on companies’ overall costs issmaller than it is generally assumed to be. This isall the more true if the discussion of financial bur-dens is limited to employers’ contributions to thestatutory health insurance system. Even whencompared internationally, health-related labourcosts in Germany are by no means higher thanthose of comparable countries.

Since health-related labour costs account foronly a small proportion of gross output, reducingthem also has hardly any potential for increasingcompetitiveness. Consequently, the univariate

analysis is unable to show any empirical connec-tion between differing burdens on employers fromhealth costs and employment trends in sectors thatcompete internationally.

Our study did not include the craft professionsor personal services. As with the relatively highlevel of health-related burdens in healthcare, heretoo it must be assumed that the burden is muchhigher. These sectors of the economy are at pres-ent competing mainly with the black market,where no contributions to health insurance arepaid. The implementation of the European servic-es directive will also bring a potential for interna-tional competitors with low labour costs. Labourcosts and thus ancillary labour costs are thereforeentirely relevant quantities for employment trendsin these sectors. The option currently under dis-cussion, of offsetting such expenditure against taxliability, is therefore an interesting option.

Even if politically motivated restrictions onthe range of medical services available can be jus-tified by the hoped-for relief of the burden onemployers, that relief would be relatively small,even if employers were completely relieved oftheir burden. This applies to the situation both inGermany and in other countries. Against this back-

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Fig. 4. Comparison of the change in health-related labour costs and total labour costs, in percentage points, 1995-2000.

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ground, it is recommended that, if there are anyplans to curtail the benefits provided under thestatutory health insurance system, the potentiallyadverse effects for the health and social status ofthe insured need to be carefully weighed againstthe potential advantages for the ability to compete.

Despite its limited actual importance for thecompetitiveness of large parts of the economy,calls for a reduction in the health-related burdenon employers has a psychological dimension.Breaking the link between the resources providedfor health insurance and companies’ performancecould be seen as a positive sign to the economyand improve the climate for employment.

Finally, it is noticeable that, although employ-ers in the US are under hardly any statutory obli-gation to pay health costs, the burden on employ-ers in relation to output value is comparable withthe burden on employers in Germany.

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Correspondence and offprints: Bertram Häussler,

IGES - Institut für Gesundheits- und Sozialforschung

GmBH, Wichmannstrasse 5, 10787 Berlin, Germany.

E-mail: [email protected]

68 Häussler

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