December 4, 2022

Floridian of the Year

Pat Geraghty, Florida Blue CEO, is Floridian of the Year

| 1/2/2014

A Path Not Taken

The usual suspects in making contrasts to health insurance in the U.S. are the single-payer, government-run systems in Canada and the United Kingdom. In 2010, Pat Geraghty traveled with a delegation to Germany to look at its system. It intrigued him, as did the response he received when he went to Washington on his return.

Health insurance is mandatory in Germany. All employees are required to contribute 8.2% of their gross income (up to about $58,000 in 2011) to health insurance. Employers pay a sort of match of 7.3% for a combined max of about $759 per month in 2011. Employees and their dependents in return receive coverage through “sickness funds,” privately run, competing, non-profit, non-government health insurance. That takes care of about 85% of the population. Government workers, the self-employed and high-earners can buy private health insurance from for-profit or non-profit firms. The unemployed and retired contribute out of their unemployment pay or pensions; the government kicks in for the long-term unemployed.

Most care, including dental, vision and sick leave compensation, is covered, though there’s a small co-pay for many services. Germans can pay up for enhanced services.

“We were in a meeting with the chief advocate for the German system, and I point blank asked him, just to be devil’s Advocate, would you be better if you had a single payer?” Geraghty says. “And he looked at me and said, ‘Why would we take choice away from our people, and why would we stifle innovation? Because the minute you go to one, innovation gets squelched and choice goes away.’

“I asked all kinds of people in Washington about their knowledge of the German system after our return from Germany. They said, ‘I don’t know anything about it, and I can’t really be focused on that. I’m working on U.S. health system reform.’ It was interesting to me that we bury our head and say, ‘That’s not on my radar. I’m fixing this thing.’ ”

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