To discourage excessive prescriptions and visits to the doctor you have to pay a small part of every prescription yourself, have to pay 10 euros for every day in hospital and pay 10 euros every quarter year to your doctor if you visit him. Though those additional payments are limited to I believe 2% of your annual income.
Insurance is organized over a number of non-profit insurance companies that are supposed to compete with each other, so their rates are slightly different and they are driven to develop efficient administrations.
Additionally private insurance companies are regulated in ways I dont fully know about, regulation mostly serves the purpose to ensure that the private companies do not just pick the young and healthy but have to insure everyone.
Of course corruption is high, but I dont think you can develop a system that involves money without having corruption.