In Germany, healthcare isn't exactly a right; it's a tradition.
German guilds have been insuring their members since the middle ages. The German chancellor Otto von Bismarck -- the architect of the modern welfare state -- took it upon himself to institutionalize this cultural value. He understood that the way to manage risk is to pool your assets, and the bigger the pool the better. The biggest pool of all is "everyone," and the way to get everyone involved is to bring government to bear. I find his logic to be unassailable. But it's worth asking, how's all that working out?
The German system runs on insurance63549-0/fulltext). Everybody has to have it. It's paid for by a system of "contributions," some of which come from the individual, and some from his or her employer. Those contributions are pooled, and sent out to bid to any number (more than 100) of "insurance companies." They contract with providers; or more specifically, provider associations.
Unlike some insurance based systems -- most notably, the US -- coverage is universal and compulsory. Unlike some public systems -- for example, Canada or Great Britain -- the system is more or less decentralized. The government holds the money, but does not dictate terms of production or consumption. The patient can see any doctor he or she wants, and pretty much has access to any needed treatment (facilitated by an innovative prescription-medication regime). For this reason, the German system is said to be "market based."
If so, it's like no market I've ever seen.
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There is no underwriting. Meaning, insurance companies can't set their own rates. Rates are dictated by the government in the form of a capitation scheme, constrained by the fees people pay into the system.
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Providers, meaning doctors and hospitals, likewise aren't able to set their rates. The government is, and always has been promulgating a price-fixing scheme, to control costs.
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German medical training is rigorous and, by all accounts, among the best in the world. But this system imposes entry barriers, limiting the supply of physicians. Likewise, the supply of hospital beds is strictly regulated (albeit by local government)
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And on top of that, the entire system has a corporatist bent.
So we have the monopsony power of the government, dictating terms to insurers and providers. And doctor monopolies, doing what they can with the insurance companies and the government. We could call that a corporatist approach -- where the survival of the government, and its approved vendors is more or less guaranteed. But that's not anything close to a free market system.
That said, patients seem to like it. People who have lived in both the US and Germany often prefer the German system. But there's trouble in paradise. As with all healthcare systems world wide, the cost of care is burdensome, and the government, it seems, isn't quite sure how to fix it.
Way I look at it, the key flaw in this system is the price fixing scheme, which exists at every level, from top to bottom. The government has no idea what things cost, nor is it able to determine what things "should" cost.
Price fixing can only result in one of three outcomes:
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You guess right, balancing supply with organic demand.
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You guess high, misallocating resources that would be better spent elsewhere.
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You guess low, resulting in a shortage.
German doctors currently hold that the government has guessed low, as far as their salaries are concerned. They complain that their salaries are lower than their peers' elsewhere. Which could be a red herring; I imagine living and practicing in Stuttgart would be pretty awesome; you couldn't pay me enough to practice in Philadelphia. Still, German doctors complain that they are being exploited. They do tremendous amounts of overtime without compensation. And a convoluted "points" based reimbursement scheme puts the patient last (the average German doctor spends about 8 minutes with each patient, substantially less than in the US, Australia or other European countries). They are predicting a shortage of physicians, and are pointing to Great Britain -- which is presently dealing with a dire shortage of doctors and nurses -- as the likely endpoint of the price-fixing game. Since they are unionized, enjoy monopoly power, and know how to strike, I expect they will prevail.
Germany has a fine healthcare system, with some innovative features, especially when it comes to negotiating prescription drug prices, where it has set the benchmark. The problem with tradition-based systems, as we see in Germany and the US, is that their traditions date back to a time when demand for healthcare was low. Mainly because, prior to the 20th century, doctors couldn't do much of anything. It's an open question how such systems will survive the modern era.
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