German court voids CON-type regulations

October 23, 1991

The highest court in the German state of Baden-WÕurttembergdeclared unconstitutional a government procedure similar to U.S.certificates of need. The decision, made this summer, will beappealed to the German Supreme Court, where it is likely to

The highest court in the German state of Baden-WÕurttembergdeclared unconstitutional a government procedure similar to U.S.certificates of need. The decision, made this summer, will beappealed to the German Supreme Court, where it is likely to besustained, according to Peter H. Grassmann, group executive forSiemens Medical.

If the state court ruling is upheld, restrictions on the acquisitionof medical imaging equipment throughout Germany could be eased,he said. The decision could invigorate an already healthy systemof private clinics.

About 90% of all German citizens are publicly insured, butfees are paid to private as well as public practitioners, he said.

"A socialized health system does not forbid private medicine,but free-market rules cannot be automatically applied to healthcare," Grassmann said. "Health is, first of all, toovaluable. Second, it is difficult for a patient to distinguishwhat route to choose in spending money. Doctors' offices don'thave price tags and windows to see what they are offering."

However, government rules for determining which hospital needsa CT scanner might be better handled by the forces of supply anddemand, he said.

"These (government purchasing rules) lead to the funnydistortions you always get in planned systems. Therefore, I amin principle against planning processes of that kind for normalequipment," Grassmann said.

Even if equipment purchase restrictions are relaxed, a numberof German regulations will continue to restrict medical entrepreneurs.While the U.S. government is attempting to control referring-physicianinvestment in medical joint ventures, Germany forbids nonmedicalinvestors in clinics. Doctors are also prohibited from advertising.

Such rules have not dampened overall utilization of medicalimaging equipment, however. The per-capita density of scannersin the old West German states is the highest in Europe, he said.