Christian Petzold’s Barbara unfolds in East Germany in 1980. The central character, Dr. Barbara Wolff (Nina Hoss), is a physician in her late thirties or early forties who accidentally committed some unspecified medical error in West Berlin and received amnesty from the Stasi police in return for life under Communist rule behind the Iron Curtain. As she tends to patients in the ward of a DDR medical clinic, she also receives none-too-subtle amorous advances from the institution’s male doctor Andre (Ronald Zehrfeld), who has a similar background. Barbara’s heart, however, lies with her lover, a West German man who routinely slips her contraband money and turns up for brief sexual liaisons. Ultimately, he offers to aid Barbara in securing covert passage to Denmark — which will ideally liberate her from the socialist police and government and enable the two of them to marry.

This might sound like the setup for a slick thriller, and Barbara has been promoted in some quarters as exactly that. Nothing could be further from the truth. At heart, it’s the story of one woman’s emotional and psychological metamorphosis. At the outset, Barbara demonstrates Hippocratic compassion toward patients but remains shut down inside — unwilling to even acknowledge Andre’s advances, let alone return them. Despite her inherent nurturing instincts, her long-term focus is wholly self-oriented: escape from the Communist Bloc by any means necessary. Over the course of the drama, we witness her gradually evolving into a much different person — someone emotionally accessible and magnanimous. Her transition culminates with a surprising course of action that she never would have even considered a few weeks prior.

The themes of this story are not particularly profound, but execution is everything. Thanks to expert scripting and direction, and an elegant central performance by Hoss, the shifts that we witness in Barbara Wolff are so delicate and subtle that they fly under our radar — we feel that we’re watching the credible growth of an actual person, not a character. In the background of this tale, Petzold also etches out one of the most compelling love stories in recent memory, one all the more magnificent because the film never calls it out and never goes for a big amorous payoff — it emerges and lingers delicately, sub rosa, beneath the surface of the narrative. In other words: The writer-director trusts the audience’s intelligence enough for us to infer the fundamentals. As such, the movie earns the romantic persuasiveness that it seeks, and then some.

None of this should surprise admirers of Petzold, who has demonstrated the same skill set in many prior films, such as his 2005 masterpiece Ghosts. Yet Barbara also represents a major step forward for the director. Petzold emerged from the Berlin School, a group of German filmmakers dedicated to telling slight, small-scaled stories of everyday men and women who undergo subtle transitions. In Barbara, he takes the same successful formula and posits it against a complex political backdrop without ever losing his humanistic touch — we constantly get telling little details of human nature that force us to see through the politics, as in a masterful shot of a Stasi guard racked with tears and sobs as his wife dies of a terminal illness. In this instance and at other times, Petzold seems to be saying that the Communist police and the confined physicians in this movie are all victims of the same totalitarian regime, bound up in the same emotional struggles as the rest of us, but cruelly dropped onto opposite sides of the political barrier. It’s an observation that has been made before in other pictures, but rarely as gracefully as it is here.

It is difficult to find any serious fault with this film, though it does have one tiny misstep. A substory involving a pregnant female patient treated by Barbara needs slightly greater elucidation in one respect: Petzold and co. could stand to be a little bit clearer about the fate of the child. But that’s a negligible flaw. Barbara emerges as an anomaly — a movie so impeccably crafted that it reminds one of a rare and delicate seashell with hundreds of magnificent nuances and gradations. It easily qualifies as one of the very best films of 2012.