8.71 million people in 2023, voluntarily or at the time had no other choice, but to be privately insured by a German health insurer, the so-called "Private Krankenversicherung (PKV)".
With just 36 the number of providers in 2024 has slightly shrunk and therefore remains manageable. However, finding the most suitable product amongst the vast range of different and non-transparent plans, and then acceptance because of one's personal circumstances, is like taking a walk through the jungle - without the right tools you will get stuck, and with inadequate advice & guidance private health insurance pitfalls are costly! Yet, once on the right path, being in possessing of private health insurance is the most comforting feeling when seeking medical treatment, especially it situations when it really matters.
What German private health plans cover
German private insurers operate according to the equivalency principle, meaning premiums are calcualted in such a way that they cover the costs of the insured services. In other words, those who are willing to pay higher premiums for their private health insurance will also receive more benefits and better service in return.
Both tariffs Medical” (inpatient, outpatient & dental treatment) along with “Mandatory Long-term Care” make up the main construct of a German private health policy, referred to as “Krankheitskostenvollversicherung”. There is no one-to-one English translation but it should be understood as "comprehensive health insurance".
Although cover is generally extensive, this however does not imply that all costs are reimburseable, as treatment of a symptom ...
- must be medically necessary,
- with the purpose to cure' or
- carried out due to illness/ accident.
Optional benefits
In addition to the above, the policy can be extended with the following optional benefits, which are considered as separate contracts, hence can be added or removed without affecting the main insurance construct.
Cures
The insurer pays a fixed amount for every day the insured person is required to go on cure (e.g. asthma patients).
This is an inpatient and outpatient benefit.
Hospital "per diem" Allowance
The insurer pays a pre-arranged amount for every night the insured person is admitted to hospital.
Precautionary medical examinations
The insurer pays a fix agreed amount for medical check-ups that correlate with the German statutory ("public") health system.
Premium Stability Scheme
A tariff that can be added allowing the insured-person to save up necessary funds - a buffer- that will help assure affordable premiums at old-age. Not only are these additional payments tax-deductible but are also not subject to German Settlement Tax (Abgeltungssteuer).
The 2 most common credit forms - constant and dynamic
- Constant
The insured-person determines a fixed amount by which the premium increases month for month - Dynamic
The insured-person determines the intervals in which the premium should be increased
Sickness "per diem" Allowance
The insured person sets up a payment scheme in which the insurer pays a pre-arranged amount for each day of sickness.
Different insurers have different intervals but generally the insured person can define an amount to be paid as from the second week and/ or for any of the other subsequent weeks.
In the following example the insurer would pay 200€ per day should the insured person be written-off sick for longer than 6 months.
- As of week 7 => 50€ per day
+ - As of week 14 => 50€ per day
+ - As of week 27 => 100€ per day
Worldwide medical insurance
Not all providers offer worldwide coverage as a standard, therefore it is advisable to include such a benefit as the costs are very little.
Tip: Even if a policy includes worldwide cover, adding this tariff is a way to bypass the annual excess.
One other benefit, which German health insurers call "Optionstarif", allows a switch on renewal to a different plan without having to undergo a new medical examination. This is highly recommendable to a person who has been accepted with a more serious pre-existing condition and needs the possibility to switch to better coverage, should future medical enhancements make curing treatment possible.
Restricted and Unrestricted Remedy- & Medical Aid catalogues
When it comes to reimbursements for remedies or medical aids, most German health plans pay such costs based on whether or not the specific product is listed in their catalogue and when it is, they proceed by implementing additional terms.
These can be: a deductible, reimbursement ceiling, if just the very basic version is insured, or even whether or not the same item has already be reimbursed for that calendar year.
Insurers offering cheaper plans use so-called restricted Remedy- & Medical Aid catalogues and most people never realise this until they have to use the insurance! Here a few cost examples:
Remedy Catalogue
| Device | Matter of Expense |
|---|---|
| Ergotherapy |
|
| Speech Therapy | up to 2,600€ 45 min. sessions, averaging at 40 sessions per treatment |
Medical Aid Catalogue
| Device | Matter of Expense |
|---|---|
| Sleep apnoea device | up to 2.500€ |
| Infusion pump | up to 4.000€ |
| Epithesis | up to 5.000€ |
| Oxygen unit | up to 5.000€ |
| Enteral nutrition | up to 5.000€ |
| Feeding pump | up to 5.000€ |
| Stoma supply unit | up to 6.000€ |
| Parenteral feeding | up to 6.500€ |
| Defibrillator vest | up to 15,000€ (approx. 2,500€ per month for 6 months) |
| Guide dog | 15,000€ - 25,000€ (depending on the dog's skills) |
| Orthoses | up to 25,000€ |
| Wheelchairs | Basic - fm 150€ Standard - fm 750€ Motorised - 2,500€ - 30,000€ |
| Home dialysis unit | up to 50,000€ |
| Prostheses | up to 100,000€ |
The consquences of a restricted catalogue
An extreme demonstration of what happens when a health plan has reimbursement-ceilings, is when people lose a limb. Instead of receiving a myoelectrical controlled prosthesis that can cost up to 50,000€, people have to settle with basic versions, the ones classed "medical necessary", ranging between 500€ to 6,000€.
Luckily, more common are the cases in which a person requires a wheelchair, however nowadays there are big differences.
The costs for a basic wheelchair start at 150€, a standard one can be obtained as of 750€, yet should you prefer to use mechanical assistance to e.g. comfortably move in either direction, brake and overcome slopes of 18% and more, then 4,000€ is not unrealistic.
Solution: Health plans with unrestricted Remedy- & Medical Aid catalogues, because saving at the wrong end is always costly.
Understanding the private medical billing method system - 'Scale of Fees'
Whereas members of the Germany statutory ("public") system simply show their membership card and from then on need not worry about charges, private patients are legally the receipient of invoices, consequently generally the responsible party to settle these. An exception is when admitted to hospital, as then the accounting department will ask the patient to sign a declaration in which they waive their right to receive reimbursement from the insurer. Also, some German private health insurers offer direct billing for outpatient treatment, yet this handling is in its infancy.
This raises the question what happens should there ever be a discrepancy between the physician's invoice and insurer's reimbursement. Apart from that reimbursements depend on contractual terms - insured benefits - an often sensitive topic is the 'Scale of Fees' for doctors and dentists, which all physicians must abide by and are passed by the Federal Government.
Practically physicians bill private patients on a catalogue-based listing of all treatments.
Every position in this catalogue is given a base value and multiplied by a factor a physicians are free to decide on.
There are two factor-zones with the 'Scale of Fees'
- Zone A – Standard
- Factors range between 1 to 2,3
- Factors range between 1 to 2,3
- Zone B – Extended
- Factors range between 2,4 to 3,5 with latter being the maximal permitted
- Using these factors requires specific justification of increased treatment/ efforts to be recognised as conform within the ‘Scale of Fees’
Besides the 'Scale of Fees', should physicians see it medical necessary and justifiable, they can charge above the ‘Scale of Fees’ and usually without asking for reassurance that the patient's insurer will reimburse. A rare scenario when receiving outpatient treatment yet quite common when admitted to hospital, and only after submitting the invoice to the insurer people become aware that their head physician ‘top notch’ care is not covered by their German private health plan.
Additionally to the above, health insurers do consider decisions made by the 'Central Consultation Committee for Fees', which is part of the German Medical Association.
ERICON broker recommend - Axa ActiveMe
Product Overview:
Axa's ActiveMe plan is a very new and innovative product, offering 24/7/365 online support that includes medical consultations and they reimburse expenses for various means that help maintain/ improve one’s health and fitness level.
Consulting Axa’s medical team per video conference for all kinds of matters, examinations included, clients will not only receive immediate attention, online sick-notes, prescriptions or referrals to visit specialised doctors, but will also not have to worry about having to consider the common annual excess, which with ActiveMe is set at 20% per claim, max. 500€ per insurance year. Latter is namely due when consulting external physicians of one’s free choice and an instrument all insurances implement to make the premiums more attractive to the customer and to save costs at their end.
ActiveMe is not the common German “sickness insurance” (Krankenversicherung) that companies advertise with, but the first serious concept a German insurer has introduced that focuses on peoples health and rewards those who take care of their body and soul.
Like with all, premiums can be declared in the annual tax-return to reduce the taxable income, so clients will partially receive their invested money back this way and making use of the health & fitness related benefits, neither of which are subject to the before-mentioned excess, hence fully refundable, further monies are returned to the client though yet another channel. And if all of this wasn’t enough, for all those who do not file a sickness related invoice from an external doctor or dentist, the ActiveMe Cash Back Scheme pays 700€ per full insurance for the intial 4 years, which is increased to 1,000€ for each subsequent year thereupon.
Premium examples:
The most inexpensive version, meaning with the most basic dental plan and without additional benefits such as "Premium Stability for Old Age", Hosptial per diem Allowance, "Sickess per diem Allowance", "Curs" and "Additional Long-Term care", Axa's ActiveMe health insurance can be purchased by e.g. a self-employed artist for the following premiums.
| Age | Monthly Premiums |
|---|---|
| 18 | 387.80€ |
| 25 | 424.27€ |
| 30 | 460.98€ |
| 35 | 494.63€ |
| 40 | 537.74€ |
| 45 | 591.04€ |
| 50 | 659.10€ |
| 55 | 736.86€ |
| 60 | 759.92€ |
Frequently Asked Questions
Insurance - Health - German Private
Which conditions generally lead to an application for German private health insurance to be declined?
The following so-called "red flag conditions", those that insurers know to be uneconomical, especially as insurance is for life are:
Addiction (e.g. drugs)
Aids (incl. HIV infection)
Alcoholism
Alzheimer
Anorexia
Asthma (chronic)
Bulimia
Cancer
Depression
Diabetes (insulin-dependent)
Epilepsy
Haemophilia
Heart Attack
Heart Valve Defect
Hydrocephalus
Kidney Disease (e.g. cirrhosis)
Kidney Failure
Liver Cirrhosis
Leukaemia
Pulmonary Fibrosis
Multiple Sclerosis
Mental Illness/ Break-Down
Nervous Collapse
Neurosis
Parkinsons Disease
Psychosis
Schizophrenia
Stroke
Silicosis
Acceptance of applications in the German private health insurance
To obtain insurance cover, you must first submit an insurance application to the insurer. If approved, a legally binding contract is then concluded. "Legal" means that the applicant has received the acceptance confirmation - usually the policy and other contract-relevant documentation - and the 14-day withdrawal period has expired.
Private health insurance companies can reject applications.
However, since 2009 when in Germany compulsory health insurance was introduced, private insurers must accept every person who is not subject to mandatory insurance, i.e. those who are forced to sign up with a statutory health insurance provider. These people are then placed in the private so-called and "Basistarif" and because any pre-existing medical condition is insured, it is very expensive, yet with very basic insurance coveage.How high can my income be before I have to pay for Long-Term Care insurance?
I am moving abroad, how do I cancel my German private health insurance?
If you have given up your residence or centre of life in Germany you have an extraordinary right of early termination, and providing evidence within two months of departure the insurance contract can be cancelled retrospectively.
Your German insurer will need the following for each insured person:- Official deregistration certificate from the residents' registration office
- Official arrival paperwork at new destination
- Copy of new health insurance
Important to understand is that to comply with German health insurance legislation, the insurers must sustain coverage if prerequisite for early cancellation is not given!
What does substitutive health insurance mean?
For an insurance plan to be substitutive in Germany, legislation defines the following.
- Insurer's ordinary right of termination is waived
- Premium-calculation is based on actuarial principals
- Saving towards the 'Old-Age-Reserve' are implemented
- On changing tariff, 'Old-Age-Reserves' are transferable
When employed, how much does my employer contribute?
On the basis that the employee's health care meets the requirements of the German Social Insurance Act, Book V §257 (2a), employers must contribute towards their staff's private health insurance, namely the medical- and long-term nursing care tariffs. The subsidies are legally regularised and beause the calculations that determinate the maximum payable are not easily comprehensible, we suggest to remember the following: Max. 50%, considering the following caps.
Employer’s monthly contribution ceilings 2024:
Medical Insurance: 421.76€ Long-term Nursing Care: 87.98€ Total: 509.74€ What is the "Übertragungswert" for?
As of 01.01.2009 all German insurers are obliged to certify the so-called “Übertragungswert" that is the saving available for transfer to a different German private health insurer.
To be precise, it is the monetary amount available from the “Old Age Provisions” (German: “Altersrückstellungen”) that insurers must collect up to the customer's 60th life year by adding a statutory 10% surcharge to the premium,The purpose of "Old Age Provisions” is to compensate for increasing health insurance benefits/ costs at old age. Without these provisions private health insurance would be unaffordable for most elderly people.
In 2022 German private health insurers collectively held a total of 315.5 billion Euros in “Old Age Provisions”.
