German term (edited): B�rgerversicherung vs. Kopfpauschale

That's one reason Seehofer is pleading for a citizen-insurance ("Buergerversicherung"), which some experts expect to reduce insurance premiums by 2 percent.
However, the question is whether an income-based financing system will be a lasting solution to the current problem? Late last year Chancellor Gerhard Schröder called for a commission of experts to present ideas for a reform. The highly controversial work of that commission under economic scientist Bert Ruerup presented two paths into the future which couldn't be more different. One was Seehofer's "Buergerversicherung", which would take into account all citizens and all forms of income. The other plan is a flat-rate-system, in which every person pays a certain amount no matter how much they earn. People with low incomes would be compensated through tax relief. A similar system is working very well in Switzerland, which is the main argument for this reform.

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