Medical Device Daily Contributing Writer
And MDDs

Healthcare reform is on the way in Germany following last month's "breakthrough" agreement, as cited by Health Minister Ulla Schmidt. The agreement ends months of bitter disputes within the government's multiparty coalition. Originally scheduled to start Jan. 1, the reform now will take effect on April 1.

The amended reform proposal will be put to a vote in the Bundestag, the lower house of the German Parliament, this month. The compromise is considered a victory for the government of German Chancellor Angela Merkel, which saw its popularity plummet in the fall as the reform ran into heavy resistance.

A core element of the Merkel plan for reducing costs and making the system more transparent is the creation of a central fund to consolidate the 250 separate health funds to which 90% of the population — 70 million people — contributes about 14% of annual salary.

Under the compromise, creation of the fund will be delayed until 2009.

The final dispute concerned what many saw as a disproportionate shift of the financial burden for the healthcare system to wealthier states in the German Federation in order to offset contributions from struggling states, such as those in the former East Germany.

Bavarian conservatives led the battle against the Merkel proposal and won the delay for the Bundestag vote.

Germany's ailing healthcare system is ranked as the world's third-most-expensive, behind Switzerland and the U.S., according to the Organization for Economic Cooperation and Development.

The system is expected to report a shortfall of 1 7 billion ($9 billion) this year, creating a sense of urgency and a pressure on legislators "to stop tinkering and take decisive action," according to an analyst at Global Insights.

The Merkel cabinet scored a victory in maintaining extension of the healthcare system to all German citizens with universal coverage. Today up to 300,000 Germans are uninsured, while at the opposite end of the social ladder some 8 million of the wealthiest subscribe to a private health plan.

The left-wing government's intentions toward the nation's private insurers was hotly debated by conservatives. Under the reformed system the newly created central fund would pay a flat fee to insurers for each citizen enrolled. Currently each insurer manages the costs for care based on a fund that receives contributions from employees and employers participating in the plan.

Under the reform, the private fund will be allowed to increase contributions from employees to a maximum of 1% of salary to help pay off debt ahead of the 2009 creation of the central fund. There also are incentives for insurers to take on elderly and high-risk patients. To address the uninsured, the Merkel cabinet proposed that private insurers open plans to all, but without the ability to screen applicants for prior health conditions. Dropping this last term led to the announcement of a compromise.

Meanwhile doctors in Germany took to the streets again to protest the reforms, saying in a joint statement issued in December: "This reform will simply lead the healthcare system into the cul-de-sac of centralized bureaucracy." A protest strike last April won participation of the nation's doctors, dentists, pharmacies and hospitals.

Medicsight corporate name now MGT

Medical imaging software company Medicsight (London) has changed its corporate name to MGT Capital Investments (MGT).

The company said the new name reflects its position as the parent company to Medicsight plc, a developer of computer-aided detection (CAD) technologies and software, and Medicexchange plc, an online multi-vendor sales channel for diagnostic, treatment and surgery planning solutions.

Tim Paterson-Brown, company CEO, said the re-branding "more accurately represents our position as an investment company creating shareholder value by supporting the growth of our healthcare information technology subsidiaries. This initiative should eliminate any confusion between the American Stock Exchange-listed parent company and our CAD-company subsidiary."

MGT said it now has cash and cash equivalents of $40 million and is "well positioned to accelerate the commercialization of the business solutions developed by its subsidiaries," as well as seeking additional opportunities complementary to its business strategy.

Paterson-Brown said, "We have made tremendous progress in the development of Medicsight's CAD products and continue to gain traction and see strong demand in the market for this advanced detection software. We have also received positive initial feedback following the U.S. and China launches of Medicexchange.com, our radiologists' portal that we believe will enhance the sales opportunity for medical imaging software solutions."

NHS to recoup injury treatment costs

New rules allowing the UK's National Health Service to claim back money for treating people who have been paid personal injury compensation could see more than 150 million being put back into patient care.

The Injury Costs Recovery plan means that for the first time, the NHS will be able to recover costs from insurance companies for treating patients in all cases where personal injury compensation is paid. Hospitals already are able to recover the costs of treating people injured in traffic accidents where they have successfully claimed compensation for their injuries.

NHS costs are payable by the insurer that pays the compensation. Since the traffic-accident payment program came into operation, it has recovered about 115 million a year for the NHS.

Health Commissioner Andy Burnham said, "It is unacceptable that taxpayers have to pay for the medical treatment of someone injured at work simply because employers fail to take adequate steps to protect their workforce. Individual hospitals will now be able to recover the costs and decide where they want to reinvest that money to improve services they want."