127II. El arrendamiento de bienes muebles e inmuebles del Estado, conforme al valor

FUND RAISING

The most important form of fund raising in the LTCI is the contribution premium of the insured people. Different from pension insurance and unemployment insurance in Ger- many, benefits of LTCI are paid directly from current insured person’s contribution, which is also known as Pay-as-you-go (Umlageverfahren). Contribution is paid half by employer and the other half by employee. The contribution rate was 1.7% of employee’s gross in- come as it was first set before June 30, 2008. Since July 1 of 2008, this rate has increased to 1.95% (§ 55 Abs.1 SGB XI). From 2005, people without child have to pay 0.25% more than those who have their own children, which is 2.2% in total (Federal Constitutional Court- Bundesverfassungsgericht ,BVerfG). Currant contribution rate is 3.05% of the employee’s gross income. For those over 23-year-old and childless employees, the contribution rate is 3.3%. An overview of the current contribution policies is given in Table 3.6.

Table 3.6: Overview of current contribution policies in LTCI

LTCI is built in the frame of statutory health insurance. However, benefits that paid for the people with need of care are based on care level assessment in form of the flat rate. In other words, only part of the expense on care services that are demanded will be covered. Secondly, the contribution rate is a fix number which is defined by the law. However, in the system of statutory health insurance, different health insurance companies can decide the proportion of the contribution that will be booked from one’s salary. Although in the con- text of the health reform in Germany, a general uniform contribution rate was introduced for the health insurance system and implemented since 2009, each health insurance com- pany still have the right and space for collecting additional contribution (Zusatzbeitrag).

Besides the contribution to the nursing insurance fund, state governments also have a responsibility to establish an efficient and adequate care structure (§9 SGB XI). The details of the planning and promotion is determined by the state law, whether or to what extent the state law should provide care-oriented financial support. But in fact, state governments started rather late [128, 129].

EXPENDITURE OFLTCI

The most important expenditure of LTCI is the payment of benefits. By the end of 2016, about 2.75 million beneficiaries receive their benefits from statutory LTCI. Among these beneficiaries, a total of 1.97 million received ambulant care services, and about 7.75 mil- lion are living in nursing institutions. The statistics of the number of beneficiaries who are covered by both statutory and private insurance companies is depicted in Table 3.7.

Table 3.7: Total number of benefit recipients of statutory and private LTCI

Table 3.8: Number of benefit recipients of the statutory LTCI categorized by degrees of care on June 30, 2017 [130]. *this includes all those in need of care who were transferred from three care levels to five degrees of care at the turn of the year 2016/2017 and still receive benefits to the deadline.

Total expenditure of statutory LTCI amounted to€ 31 billion in 2016 (Federal Ministry of Health-Bundesministerium für Gesundheit,BMG), of which€ 28.29 billion was the expen- diture for paying benefits. Compared with 1997, when first-time ambulant and inpatient services were financed all year round, total expenditure thus was increased by 15.86 billion euros, more than twice as much. In terms of gross domestic product (GDP), the proportion of expenditure on social LTCI increased only slightly: it was 0.77 percent in 1997, 0.86 per- cent in 2010 and 0.99 percent in 2016 of the GDP (own calculations according to BMG and StBA). In 2016, about 36.1 percent of social nursing care expenses went to inpatient care. In addition, cash benefits in ambulant care were particularly important (22.1%). Together, these two areas accounted for 58.2 percent of all spending. The share of administrative expenses remains in the low level at 3.3 percent.

Since 2015, a new form of expenditure in LTCI system is added, which is the nursing in- surance fund. In order to finance the service improvements under the PSG I, the contribu- tion rate for LTCI was increased by 0.3 percent since January 1, 2015. Annually the income of 0.2 percentage points, which is amounted to be 2.4 billion euros, flow into the additional benefits. The remaining income of 0.1 percentage points, around 1.2 billion euros per year, will be transferred to a newly established nursing insurance fund in the form of a special fund managed by the Bundesbank. The nursing insurance fund should contribute to the reliable financing of LTCI in the future and help to stabilize the contribution rate from 2035 onwards. Thus, the care service remains affordable even if the baby boomers come into an age in which they may need care. Table 1 and 2 in appendix chapter have summarized the financial development of the stattutory LTCI from 1995 to 2006 and from 2007 to 2016, respectively.

After the PSG II, in the first half of 2017, the expenditures of the nursing insurance fund grew by around 5.5 billion euros and reached 20.8 billion euros. To compare with the en- tire past year, the LTCI expenditure was 29.7 billion euros. According to a long-standing estimate, the nursing insurance fund leading association (Kassen-Spitzenverband) expects rising expenditure of over 37 billion euros in 2017, which means the LTCI reform in 2017 has improved the care services for those who concerned. Despite the increase in contribu- tion, this is only the offset by estimated income of around 34 billion euros. The deficit is to be balanced out with the existing reserves of LTCI of around 9.4 billion euros[131].

Compared with statutory long-term care insurance, the benefit of private care insur- ance is basically the same. But contributions in private care insurance is not relative to one’s income, but vary from provider to provider. Privately insured persons are usually civil servants or self-employed persons. There is no employer’s share in this case. For "regular employees", who are privately insured, the employer’s share is usually 1.525%. It does not differ from the contribution for socially insured employees. If the employer’s share is dif- ferent, it does not exceed at least half the total contribution of the privately insured person. The financing system of private care insurance is funded (Kapitaldeckungsverfahren) similarly to private health insurance [132, 133]. Health situation assessment is demanded in contribution planning for the people who join the private care insurance after 1995, but no difference between male and female [134]. It is regulated that, the contribution should

not exceed the highest contribution amount in statutory long-term care insurance after 5 years being insured in private care insurance. Persons should not be refused due to certain pre-existing conditions, and persons already in need of care should not be rejected. As with social care insurance, children of insured persons are also insured by free of charge [135, 136].