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HEALTH INSURANCE

Why more than 20 million people in Germany face higher health insurance costs

Several German health insurance companies have raised their rates this year, pushing up the costs for customers.

Many people are facing higher health insurance contributions this year.
Many people are facing higher health insurance contributions this year. Photo: picture alliance / dpa | Jan Woitas

According to a study by the comparison portal Check24, around 21 million people with statutory health insurance (gesetzliche Krankenversicherung or GKV) have had to pay higher contributions since the beginning of the year after several organisations raised their additional contributions. 

A total of 19 of the 97 statutory health insurance providers in Germany have increased their additional contributions, the comparison portal found.

It means more than a quarter of the 73 million people with statutory health insurance in Germany have to pay higher additional contributions. 

According to Check24, the higher additional contributions can cost an insured person in the most expensive case an extra €261 per year.

Among those to have raised their additional contributions include AOK Baden-Württemberg and AOK Bayern, which have both increased the additional contributions from 1.10 percent to 1.30 percent. Check24 has published the full list of additional contributions here.

Customers affected receive a letter in the post letting them know when their contributions are increasing. Health insurance providers justify raising their rates by pointing out rising costs in the health and care system. The pandemic has also put significant strain on providers. 

READ ALSO: How to make the most of reward schemes on your German health insurance

A total of 67 health insurance providers are keeping their individual additional contribution the same. And as many as 11 health insurance funds lowered their contributions – although most of these already had comparatively high rates.

In 2021, Techniker Krankenkasse (TK), the largest statutory health insurance fund in Germany with around 8.2 million members, raised its additional contribution significantly.

The contribution went up to 1.2 percent from 0.7 percent. Average earners saw additional monthly costs of about €10 extra, while self-employed people had to pay up to €288 more per year. 

TK has not raised its rates this year. 

Can you switch health insurance?

If your health insurance company increases the additional contribution, those insured have a special right of termination until January 31st, 2022.

They can apply for the change up until this date, and they will then become a member of the new health insurance provider from April 1st after the statutory two month change-over period has expired.

Insured people also have the right to change their statutory health insurance fund every 12 months.

The cost of public health insurance in Germany is a fixed salary percentage of 14.6 percent, while the reduced contribution rate for employees without entitlement to sick pay is 14.0 per cent.

Beyond that, however, health insurance providers set an additional contribution, which can currently be up to 2.5 percent.

The contribution assessment ceiling for statutory health insurance (GKV) – up to which contributions are levied – remains unchanged at €58,050 per year in 2022, as in the previous year.

Check24 said that switching providers can save employees up to €624 per year depending on their income.

Self-employed people pay both the employee and employer contribution and can therefore save up to €1,248 euros per year by switching, the analysis found. 

However in a representative YouGov survey only 11 percent of respondents in Germany said they had recently changed their insurance provider or would do so in the foreseeable future.

Most of the benefits provided by statutory health insurance organisations are identical.

READ ALSO: EXPLAINED: The three new services covered by German health insurance

However, there are some differences in the voluntary benefits, including dental health (professional dental cleaning and discounted dentures), vaccinations (flu vaccinations for under 60s and travel vaccinations), various cancer screening examinations and osteopathic treatments.

“In addition to the financial relief, insured people can also secure higher subsidies for professional dental cleaning or other additional benefits by switching,” said Dr Daniel Güssow, Managing Director of statutory health insurers at Check24.

Vocabulary 

Additional contributions (die) Zusatzbeiträge

Right of termination – (das) Kündigungsrecht 

Benefits (die) Leistungen

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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MONEY

Where in Germany do people have the highest disposable income?

An economic study has shown huge regional differences in income throughout Germany. So which parts of the country have the most to spend each month, and which are feeling the squeeze?

Where in Germany do people have the highest disposable income?

A study by the Economic and Social Sciences Institute (WSI) of the Hans-Böckler foundation reveals stark regional differences in disposable income in Germany. In some cases, households had as much as double the spending money of those in other parts of the country. 

Here’s where people have the most – and least – disposable income each month.

What is disposable income?

The WSI calculated disposable income as the sum of income from wealth and employment, minus social contributions, income taxes, property taxes and other direct benefits or taxes.

What’s left is the income which private households can either spend on consumer goods or save.

The study, which was based on the most recent available national accounts data for 2019, looked at the disposable income of all of the 401 counties, districts and cities across Germany.

Which regions have the highest and lowest disposable incomes?

The study found that the regions with the highest disposable incomes were in the southern states.

Heilbronn in Baden-Württemberg had the highest disposable income of all 401 German counties and independent cities – with an average per capita disposable income of €42,275. The district of Starnberg in Bayern followed in second place with €38,509.

READ ALSO: REVEALED: How much do employees really earn across Germany’s states?

By comparison, per capita incomes in the cities of Gelsenkirchen and Duisburg in North Rhine-Westphalia were less than half as high, at €17,015 and €17,741 respectively. These regions had the lowest disposable income in the country. 

The study also found that, more than thirty years since German reunification, the eastern regions continue to lag behind those in the west in terms of wages.

According to the WSI, the Potsdam-Mittelmark district is the only district in the former east where the disposable per capita income of €24,127 exceeds the national average of €23,706.

Do regional price differences balance things out?

The study also showed that regionally different price levels contribute to a certain levelling out of disposable incomes, as regions with high incomes also tend to have higher rents and other living costs.

“People then have more money in their wallets, but they cannot afford more to the same extent,” WSI scientist Toralf Pusch explained.

READ ALSO: EXPLAINED: When will Germany raise the minimum wage?

Therefore, incomes in the eastern states, adjusted for purchasing power, are generally somewhat higher than the per capita amounts would suggest.

That could explain why, even after price adjustment, the cities of Gelsenkirchen and Duisburg in western Germany continue to be at the very bottom of the list.

Saxon-Anhalt’s Halle an der Saale, on the other hand, which has an average disposable income of only €18,527, benefits from the lower prices in the east.

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