In Germany, there are two ways you can obtain health insurance: statutory or private. While statutory health insurance is accessible to everyone, there are certain requirements you must meet to join a private health insurance plan. This article explains the differences in tariffs and services and generally which option is the best.
The two health insurance options operate under different systems. Statutory health insurance (GKV) is the state variant. Private health insurance (PKV) is non-state and is offered by private insurance corporations.
The GKV is a solidarity system in which every insured person pays the same percentage of their income. The services of the different health insurance funds hardly differ. 95% of the offerings are the same due to legal requirements. The PKV, on the other hand, allows more individual leeway. It depends on which insurer you choose and what services you want. For example, you could get a private doctor’s visit—if you’re willing to pay for it. Therefore, service costs. Conversely, this also means: A cheaper PKV tariff automatically leads to fewer services.
One advantage of the PKV is the contract binding. This means that the agreed services cannot be easily canceled after the contract is signed. In statutory health insurance, the insurer can essentially do this, especially if the legal situation changes.
Here you will find an overview of the key differences between statutory and private health insurance, which we will discuss in detail next.
Since there is a mandatory health insurance requirement in Germany, the GKV cannot reject anyone. In other words: Everyone is accepted into the statutory variant. Age, pre-existing conditions, income – none of this matters for this mandatory insurance.
For the PKV, however, there are some hurdles. Typically, only civil servants, (full-time) self-employed people, and freelancers, as well as students under certain circumstances, are accepted—if they wish. Children and non-working spouses of these groups can also insure themselves privately.
Employees must exceed a certain income limit. In 2021, this annual earnings threshold is €64,350, equivalent to €5,362.50 monthly. Those who earned more than this sum in the previous year are allowed to insure themselves privately. However, this is not mandatory.
Private insurance can also reject potential policyholders, for example, if they have certain pre-existing conditions that must be declared in the application. You have no right to a PKV, even if you exceed the income limit. The only exception is the standard tariff with the most necessary services, into which every private health insurance must accept you, provided you are not legally insured or have
been privately insured before.
The services of both types of insurance are hard to compare, as the PKV offers numerous individual options, while the GKV provides the majority of standard services equally to all.
Depending on your own priorities and financial leeway, you can use the following amenities in the PKV, which are only possible in the GKV with additional insurance. A selection:
Free choice of doctor instead of only insurance-approved doctors, shorter waiting times at doctor appointments, as doctors can bill higher fees with the PKV, No co-payment for prescription drugs
Free hospital choice, Free doctor choice: private doctor visit instead of the duty doctor, Single room instead of multi-bed room
In addition to the basic offer, private supplementary insurances for more individuality are possible in the GKV. Hereby, you simply book additional services via a private contract in addition to your GKV. This allows you to achieve the status of a privately insured person in certain areas, such as with the single-bed option.
The contribution to statutory health insurance is 14.6%. Here, employees and employers share the costs 50/50. Thus, an employee pays 7.3% of their gross wages. Additionally, there are supplementary contributions from the respective health insurance fund, which have also been split equally between employer and employee since 2019 and total 1.6% on average in 2023.
The GKV umbrella organization lists in its overview which health insurance fund charges how much for the additional contribution. If you are not satisfied with the payment, you can switch to another GKV at any time. With our gross-net calculator, you can find out exactly how much you pay for your health insurance.
This does not affect any payments for personal supplementary insurances, such as the single room in the hospital.
The contribution for private health insurance is not calculated as a percentage of income, but depends on various factors. First, the individually chosen scope of services is crucial. More service incurs higher contributions. Age – the younger, the cheaper – and possible pre-existing conditions and surgeries also play a role. These can either lead to the rejection of the insurance application (severe pre-existing conditions) or to an additional contribution (minor surgeries and non-costly pre-existing conditions, such as visual impairment).
For the contribution of the PKV, there is a subsidy from the employer for employees, which is capped at the maximum amount for the GKV. Thus, in 2021 you receive a maximum of €353 from your employer.
Here, the GKV scores a plus point. Children and spouses without their own income, in parental leave, during unemployment, or with a €450 job, are insured without additional contributions. In the PKV, however, each person must always be insured themselves. For a family of four with one breadwinner and two children, 4 insurance policies must be concluded and paid for.
Private health insurance offers flexible care. So, you can put together insurance coverage that meets your individual needs. If you value special treatments, you can include the supplement for non-insurance-approved doctors.
Another major advantage is the choice of a single room and/or private doctor treatment in the hospital. The free choice of the hospital also offers more freedom of choice. This option is not available in the GKV. Generally, you also fare better with dental treatment in the PKV, as not only the basic care like in the GKV is paid for.
There are also no additional payments for prescription drugs, as long as you have not concluded insurance with a deductible. With the deductible, you reduce your insurance contribution but also bear all health costs up to the agreed amount.
A plus point for some may be the planning security regarding the offer. Once the contract is signed, the insurance cannot reduce the listed services. Moreover, these are usually more comprehensive than in the GKV. However, the insurances demand risk surcharges for health complaints – and the contributions can also increase regardless of performance.
The money you save in younger years with lower contributions – also often a reason for switching – must be spent in old age. Therefore, you should pay attention to age provisions that mitigate the higher contributions.
Why does statutory health insurance make sense?
Statutory health insurance is particularly worthwhile for families and all singles planning a family. Unlike the PKV, where each person must be insured individually, statutory health insurances offer a family tariff. Spouses who are unemployed or on parental leave are automatically insured in it. As are children up to 23 years as long as they are not working or up to 25 years if they are studying. If you want this in the PKV, you must conclude additional policies, then also receiving better services.
Moreover, the contributions in the GKV are always proportional to the income, which may also make it interesting for freelancers as voluntarily insured statutory members. If you earn less, you pay proportionally less. This principle of solidarity also means: If you lose your job and slide into unemployment, the state takes over. If you reduce hours, your payable share decreases proportionally. This also applies to the retirement period when you usually have less income available. In the PKV, you always have to pay the same amount – no matter how high your income is.
Of course, this percentage may change in the future, but only by the legislature and not due to illnesses or a tariff change. By the way: Switching between different statutory health insurance funds is much easier than between PKVs, as each time a new health check is required and the switcher has also aged in the meantime.
However, you should not only consider the costs but also the services of your health insurance. And here, the PKV generally offers the better options. If you do not want to or are not accepted into private health insurance, you can also take out private supplementary insurances for the services that are particularly important to you and your family.
Especially in old age, contributions for the PKV increase so significantly that many wish they were in the GKV, even though with increasing age and more frequent illnesses, one benefits more from the services of the PKV. Switching from private to statutory health insurance is not impossible, but relatively difficult.
The legislature intentionally built certain hurdles for the switch at the beginning of the 2000s. This is to prevent everyone from using the cheap contributions in the PKV in their younger years and the cheaper ones in the GKV in old age – and thus benefiting from the solidarity system into which they had not previously paid.
A switch is therefore only possible:
• For employees up to 55 years, if they fall below the insurance obligation limit (€62,550 in 2020 and €64,350 in 2021), which is accompanied by a loss of income.
• For self-employed people up to 55 years, if they enter into a socially insured employment relationship and stay below the insurance obligation limit.
• For self-employed people over 55 years, if they give up their business and earn less than €415 monthly (this includes rental income).
• For people over 55 years only in the form of family insurance, if the income does not exceed €425 monthly.
By the way, switching between two different private health insurances is not that easy either. Especially after the first cases of illness, those willing to switch have problems finding a suitable PKV. Moreover, such a switch is not always sensible. In this case, the accumulated age provisions of the insurance could partially evaporate, requiring higher sums for health insurance in old age. On the other hand, switching from one statutory health insurance to another is feasible without losses – of course, only as long as the switch does not happen every few weeks.
To find the right health insurance, you should first consider your life planning and needs. Do you want to start a family? How much are you willing to pay for individuality? Would you rather always be covered for all cases? And can you live with the relatively high contributions in old age?
Only then does it make sense to deal with the two options and the individual health insurance funds. With statutory health insurance funds, you can’t go too wrong, as 95% of the services are identical.
For all those who are not accepted by a private health insurance for various reasons, there is the option to take out individual private supplementary insurances with statutory health insurance. In this way, it is possible
to obtain options that would otherwise only be available to private patients. These include:
Offers more performance and reimbursement for high-quality dental prosthetic treatments.
Provides you with the best possible coverage while traveling.
Allows free choice of the hospital you are admitted to, private doctor treatment, and a single room.
Essentially covers everything not related to the hospital, such as alternative healing methods and visits to non-insurance-approved practices, from hearing aids to preventative examinations and vaccinations.
Particularly interesting for self-employed, freelancers, and employees with income above the contribution assessment ceiling, to protect against loss of income during prolonged illness.
Covers costs for care in case of dependency.
The costs for the individual supplementary insurances vary depending on the scope of services – as in private health insurance. For example, hospital supplementary insurance can cost up to €80 per month. For dental supplementary insurance, as a young person, you can start with about €7 per month, depending on the extent of cost coverage. For the same amount, however, annually, there is already travel health insurance. The cost of outpatient supplementary insurance depends on the bundled package. For a sample combination of naturopath, glasses, and co-payment for prescription drugs, about €20 per month is required. Generally, the contributions for services usually increase with age.
A positive aspect of the private supplementary insurances is that they are generally easy to cancel, and your remaining insurance coverage remains unaffected. This also means that you do not receive a new overall tariff, as can be the case with private health insurances.
If you are a self-employed person, civil servant, or employee with an income above the annual earnings threshold, you meet the requirements for admission to private health insurance, and you have free choice. In this case, private health insurance generally offers more services, better medical care – and thus more protection.
However, caution is advised with low contributions in the PKV, as they often do not offer much more service than statutory health insurance.
On the other hand, statutory health insurance is often the only option for most employees due to the annual earnings threshold. But even for the group of people who could insure themselves privately, entry into the GKV is easily possible in younger years. Additionally, all those insured by law can extend the basic care of the GKV to their individual needs with private supplementary insurances – and thus elevate themselves in certain areas to the status of a private patient. Depending on the desired service, it may make sense for employees above the assessment limit to conclude statutory health insurance with a private supplementary insurance, such as a single room in the hospital or high-quality dental treatment.
Saving money in the long run with the PKV is not possible, as the contributions increase with age. Moreover, switching from the PKV to another PKV or even to the GKV at 55 years, when contributions significantly rise, is very complicated. Also, medical advancements are not always covered as a service in the contract, necessitating a new tariff.
The GKV also offers financial protection. While you must always pay the agreed contribution in the PKV in all life situations, the costs in the GKV always adjust proportionally to your income. This is a plus point, especially in retirement.
Private health insurance is possible for employees if they earn at least €62,500 gross per year in 2020 or €64,350 in 2021, or if they are self-employed, freelancers, or civil servants.
If family insurance is not possible, the health insurance fund demands 14.6% on the fictitious minimum income for the year, which was set at €1,061.67 in 2020. This corresponds to a contribution of €155. For the year 2021, it is calculated at €1,096.67, equivalent to €160.11. If you receive social benefits, this amount is paid by the state. In addition, there is the supplementary contribution of the respective health insurance fund.
The switch from PKV to GKV is only difficult. For people under 55, significant income losses are usually necessary to fall below the insurance obligation limit. People over 55 may only receive €425 monthly from income, self-employed only €415.
Private health insurance is based on the chosen tariff, age, and health status. Therefore, a blanket statement about the monthly due amount, as with the GKV, is not possible.
If you permanently have no income and cannot rely on assets, you are usually entitled to unemployment benefit II. Then the social welfare office or job center pays your health insurance contribution for the statutory insurance.
Whether private health insurance makes sense depends on income, life planning, and age as well as health status. Also important is the decision on which services you personally want. In principle, it is attractive only for high earners with long-term secured income and civil servants.
In statutory health insurance, the employee and employer each share 7.3% of the contribution rate. There is also the individual supplementary contribution of a health insurance fund. In private health insurance, the contribution rate is the same, but there is a maximum amount from the employer, the same as for the GKV.
Contact AIVADO today to discuss your health insurance needs. Let us help you make the best choice for you and your family, ensuring peace of mind no matter what your future holds.
With AIVADO, you gain an advocate in navigating the health insurance landscape. We provide clarity and support, ensuring you choose the best option for your health and financial well-being.
