Health Insurance in Germany

Health Insurance in Germany

Health Insurance in Germany

About 87 percent of the  residents of Germany have statutory health insurance, i.e. GKV. As of May 2005,  the GKV relied on 321 non-profit sickness funds to collect premiums from their  members and pay health care providers according to negotiated agreements. Those  who are not insured this way, mainly civil servants and the self-employed,  receive health care through private for-profit insurance.

An estimate of 0,3 percent of  the German population (around 250,000 people) has no health insurance at all.  Some of them are so rich that they do not need it  but most of them are poor and receive health  care through social assistance.

Statutory health insurance

There are three different  categories of sickness funds: primary funds, substitute funds and “special”  funds. Some workers are required to be members of the primary funds, e.g. if  they earn less than the than the income ceiling (2006: EUR 3,937.50 per month /  EUR 47,250.00 per year). Those earning more than that ceiling may be members on  a voluntary basis, or they may have a choice of funds. Some of them  automatically become members of a particular fund for example because of their  occupation (company-based funds) or place of residence (local sickness funds).  Some occupations have their own “special” funds, e.g. farmers or sailors.

Substitute funds are divided  into two kinds: they provide health insurance to both white collar workers and  blue collar workers earning more than the income ceiling. Membership is  voluntary.

Both, employers and employees  pay half of a member’s premiums, which in 2006 averaged between 13 and 14  percent of a worker’s gross earnings up to the contribution assessment ceiling  (2006: EUR 3,562.50 monthly / EUR  42,750.00 p.a.). Premiums are fixed according to earnings rather than risk and  are unaffected by the respective member’s marital status, family size, or  health. Premiums are the same for all members within a particular fund with the  same earnings.

Private health insurance
About eleven percent of Germany’s  residents pay for private health insurance provided by some 40 for-profit  insurance carriers. Many of those  choosing private insurance are civil servants who want to secure percentage of  their medical bills not covered by the government. Some sickness-fund members  buy additional private insurance to cover such extras as a private room or a  choice of physicians while in a hospital. Otherwise, the medical care provided  to the publicly and privately insured is identical. In both cases the same  medical facilities are used. Self-employed persons earning above the income  ceiling must have private insurance. Members of a sickness fund who leave it  for a private insurance carrier are not allowed to return to public insurance.

As opposed to the statutory heath insurance,  contributions to the private insurance depend on the member’s age, gender,  occupation and health status, that is, the individual risk. Although private  insurance companies pay health care providers about twice the amount paid by  the primary sickness funds, private insurance is often cheaper than statutory  health insurance, especially for younger policyholders without dependents. As  is the case for members of sickness funds, employees who have private insurance  have half their premiums paid by their employers.
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