What Is Private Health Insurance - Persons eligible for private health insurance in Germany include freelancers, self-employed persons, students, civil servants and employees who earn more than €62,500 per calendar year. Employees who earn this income are required to participate in a statutory health plan.
However, there is an additional requirement for private health insurance providers that employees earning above the income threshold complete a medical assessment. Provided the individual passes the above assessment, then private health insurance can be tailored to the individual's specific needs. This is one of the biggest advantages of choosing private health insurance over public health insurance.
What Is Private Health Insurance
Unlike the public system, private health insurance providers have the power to deny an individual's application for coverage if the individual's medical condition is too serious. This could mean problems for people who are not compulsory in the public system and do not meet the rules of voluntary membership. To prevent this, German law requires all private health insurance companies to offer a Basistarif, a "basic plan." This type of insurance must provide a range of benefits comparable to public health insurance, and its contributions do not depend on a person's health assessment, but on their age. The price of this insurance cannot by law be higher than the maximum contribution paid by the highest earners involved in the public system.
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Private health insurance companies offer two types of health insurance: full comprehensive health insurance or supplementary health insurance. Comprehensive health insurance plans are all inclusive and can be fully customized for an individual to meet all their healthcare requirements. On the other hand, supplemental health insurance is available for those who are enrolled in public insurance and want to bridge the gap between the benefits offered by public and private plans.
This does not mean that public programs cannot provide quality care in terms of choice of doctor, accommodation during hospitalization, sick benefits and broader dental care options.
Private health insurance is based on the principle of equivalence, which means that the value of an individual's insurance depends on his contribution and the level of risk taken by the private health insurance company. The main factors taken into account are the person's entry age, medical history, medical condition, benefit coverage and any agreed deductibles. This is the key to why private health insurance plans offer so much flexibility and are easy to customize.
All private policyholders pay more premiums than needed to cover medical expenses when they are young. This higher premium, also known as the old age reserve, is designed to offset the often rising costs of health care in old age and is unique to private schemes. This ensures that premiums do not increase dramatically in later life.
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It is also a common misconception that private health insurance is more expensive than public health insurance. This may not necessarily be the case depending on the individual's personal circumstances and factors such as age and number of dependents. Unlike public health plans, when privately insured, individuals pay per capita, which can mean higher premiums for those who have or hope to start families. In such cases, it may be beneficial for households to opt for public insurance and purchase supplementary private health insurance.
Individuals with private insurance can switch providers provided they have been with the same company for at least two years. However, this of course depends on the conditions of the provider itself. As an added bonus, when a person switches from one private provider to another, the savings that went into their funds to offset the higher premiums they will have to pay during retirement (retirement reserve) are partially transferred to their new In. plan, not completely lost.
Privately insured individuals also have a great deal of freedom to increase or decrease their benefits, provided they are willing to undergo a medical examination at the start of a new health insurance plan. However, in order to avoid medical treatment, some people choose to "clown" into their policy, which means that you can insert a clause in the clause that allows you to increase the coverage after 3, 5 or 10 years without the added hassle of a medical assessment .
Private health insurance works on a reimbursement basis, which means that private health insurance companies have no payment obligations to doctors, hospitals or health care providers. Instead, there is a contractual partnership between the person being treated and the healthcare provider. In simple terms, this means that private insured persons will cover the medical costs themselves and will subsequently claim partial or full reimbursement from their private health insurance company. There is an exception to this rule for hospitalized patients, in which case the bill is billed directly between the hospital and the private health insurance company.
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A private health insurance plan recognized as a full comprehensive health insurance plan must cover at least the reimbursement of the costs of inpatient and outpatient treatment, while the deductible does not exceed 5,000 euros per calendar year. This means that you do not need to have dental care as part of your health insurance to meet the legal requirements in Germany regarding health insurance (e.g. for immigration authorities).
Would you like to discuss whether private comprehensive health insurance or supplementary health insurance is right for you? Contact our leading expert Mirja today and ask for free advice.
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No Claims Bonus Explained Like many expats, the sight of an official letter in your letterbox can strike fear faster than you can say "red tape". perfect! Another powerful letter wrapped in jargon that will be hard to understand if you think your German is rusty.
Switching From Private To Public Health Insurance In Germany
The increase in the compulsory insurance limit in 2023 and how it will affect you The compulsory insurance limit or in other words the income limit for private health insurance increases every year. In Germany this is called "Versicherungspflichtgrenze" or "Jahresarbeitsentgeltgrenze" (JAEG).
Sickness Benefit Insurance: Why You Need Cover In Case Of Serious Accidents Or Unexpected Illnesses... We all think it will never happen to us, right? It is this rationalization that leads many of us to think that we don't need health insurance to protect our income when we can't work. As a new expat, one of the first administrative hurdles you will face will be figuring out whether to sign up for public or private health insurance.
The situation is different for self-employed people than for employees. You automatically have a choice of public or private insurance. We separately offer insurance options for self-employed people.
But the good news is that as an employee, maybe not
Private Health Insurance In Germany
If you are an employee and your income is less than 62,550 euros (2020), you are automatically obliged to take out public insurance. In fact, more than 90% of Germany's population is in the public system.
Although they are generally similar in terms of legal cover, there are some nuances in non-essential cover that can cause additional charges. We will cover this later in this article.
If you've just moved and you're not yet confident in handling letters in German, it may be more important that you know how to register and handle them in English.
Now let's go deeper
Private And Statutory Health Insurance Compared
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