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Merkel seeks to resolve dispute over German health reform

Merkel seeks to resolve dispute over German health reform

German leaders head into a crucial meeting late Wednesday to resolve a dispute over health reform that threatens to sink Chancellor Angela Merkel's government, which is nearly a year old.
Merkel's conservatives and their Social Democrat coalition partners outlined plans in July to reform the country's creaking health service.
There is agreement that the burden on employers of spiraling health care costs should be eased in an attempt to revive the economy, Europe's largest.
However, the parties are feuding openly about how to finance the shift, triggering speculation that the coalition might break apart over its most high-profile reform plan.
"There is nothing worse than this debate," Health Minister Ulla Schmidt said before the crunch meeting. "It is undermining the faith of the population."
Merkel and about a dozen other top officials for her conservatives and the Social Democrats meet in Berlin late Wednesday and announce the results at a news conference.
Merkel's spokesman insisted that both sides wanted to end the deadlock.
"There is a willingness to agree," Ulrich Wilhelm said. "I assume that there will be a result that we can present." Merkel's Cabinet hopes to pass the law before the end of October.
Merkel became Germany's first female chancellor in November after forging a left-right coalition between her Christian Democratic Union and its Bavaria-only sister party and the center-left Social Democrats.
After a flying start, her popularity and that of both parties has sagged during a summer of squabbling as they tackled what was always expected to be its most difficult reform.
The health plans, which are to take effect in 2008, foresee injecting federal government funds into the health system to slow the steady rise in insurance premiums paid by employers and employees.
The main sticking point to be tackled Wednesday is whether to put a cap on the premiums paid by employees.
Social Democrats argue that a cap is vital to protect poorer Germans from excessive charges. Conservatives say a tight limit will stifle badly needed competition between some 150 health insurance firms in Germany.
Reducing payroll taxes is central to the government's plans to help German firms compete in a globalized economy. It also hopes they will hire more staff and rein in the country's high unemployment.
The plans have been dogged by criticism that they will do little to counter the fast-rising price of caring for the country's aging population.
Merkel also faces persistent media speculation that regional leaders in her own party are dissatisfied with her leadership.
Bavarian governor Edmund Stoiber, the leader of the Bavaria-only Christian Social Union, has already signaled that Wednesday's talks might not be the last.
The governments of wealthy western states such as Bavaria complain that health insurers located there will end up subsidizing those in poorer states too heavily under the current plans.
CSU general secretary Markus Soeder blamed Health Minister Schmidt, a Social Democrat, for any further delay.
"There are no clear documents, no clean calculations, so it is hard to take decisions," Soeder said on Bayerische Rundfunk radio.


Updated : 2021-06-14 04:27 GMT+08:00