Common Myths About Private Health Insurance in Germany Debunked

Choosing health insurance in Germany can be a mine field. Deciding on whether to select private health insurance or public health insurance is the first difficult decision. There’s a lot of information out there which can be misleading. We speak to hundreds of expat clients each week as independent health insurance advisors and we’re always left amused by some of the assumptions people make about German private health insurance.

Isn’t private medical insurance more expensive? Surely private health insurers provide higher quality care? These are some of the assumptions we hear all the time. But, we’re here to tell you that all those assumptions and many more are actually completely untrue.

We’re here to demystify everything you thought you knew about German private medical insurance and provide you with the facts. The facts that you need to know in order to be informed about selecting the right health insurance for you whilst living in Germany.

MYTH #1: Once you have private health insurance you can never go back to the public scheme

Not necessarily. Yes it's true that in many instances it is difficult to join the public health scheme if you’ve initially opted to be privately insured . But it’s not impossible. In fact, there are exceptions to this rule that often force people to move from the private health insurance scheme to the public health system.

For example, you cannot change to the public health system if you’re self-employed and choose to stay self-employed. If you decide to cease self-employment status however, and you earn less than the compulsory insurance threshold as an employee, it is mandatory for you to join the public scheme. Similarly, receiving unemployment compensation (Arbeitslosengeld I) from the German Agency of Labour makes you a mandatory member of the public health scheme. So if you are an employed person enjoying private medical insurance, but then your job is terminated or you are made redundant from your role, receiving unemployment compensation – even if it is only for a few days – changes your status and you will be madatorily insured in the statutory scheme whether that's your preference or not. The above exemptions do not apply to those 55 or older, however. It’s near impossible for you to move from a private health insurance plan to the public system once you’ve hit this age.

MYTH #2: If I become severely ill or injured, my private health contributions will increase

FALSE. Your private health insurance contributions are fixed at the time you apply and sign your contract. Your contributions may increase over time but this is largely related to inflation rates. It can also be impacted by advances in medical technology, innovation and growing life expectancy. It in no way is related to you and your changing individual health requirements. Your private health insurance provider absorbs the risk of whether you fall ill or not when you sign your contract. That is how insurance works!

MYTH #3: I have to pay my invoices in upfront when privately insured

There is a common misconception that those who have public health insurance don't have to pay a thing for a doctor's visit or when receiving treatment. Whilst those who have private health insurance have to pay in advance or on the spot. This is not true.

If you have German private health insurance, you will always receive an invoice for your medical bill. In most cases, your payment terms will be 30 days. This means that you will not have to pay on the spot. Every private health insurance provider also offers a mobile app designed for processing claims easily. Reimbursements are quickly and painlessly carried out. The exception is the purchase of prescription medications which you are required to pay at the counter. A different process also applies if you have extensive hospital costs that need to be covered. This is arranged directly through your hospital and your insurance provider.

MYTH #4: As you get older, your monthly private health insurance premiums will increase

As previously mentioned, the price of your monthly premiums is fixed to when you first sign your private health insurance contract.

Yes, your contributions will increase due to inflation and progress in medical innovation by 3 – 5 % on average in every year, but these factors are independent of you. That means your age or level of health will not impact your premiums. If you’re privately insured and under the age of 60, you will also pay a mandatory 10% surcharge of your health insurance premium in addition of the ageing provisions which are a part of your contributions in the private scheme anyway. This is part of an extra age reserves scheme since 2002 which dictates that you pay higher premiums when you are young, to offset the likelihood of your medical expenses being higher when you are older. This is why your contributions will not increase any more after you have turned 65. Your private health insurance provider has already accounted for this increase by charging you a surcharge since the time you first signed your contract.

MYTH #5: Private health insurance in Germany is always better than statutory public health insurance

There are many benefits to choosing private health insurance, but one system isn’t necessarily better than the other.

Germany has a world-class public health system that provides quality care to its citizens. That said, in the private system, you’ll enjoy advantages such as faster appointment times, selecting the benefits you want included in your coverage, and being able to choose private doctors. You’ll also enjoy many additional services and benefits like subsidies for vision aids, eye laser surgery, better reimbursement of dentures, access to natural medicine and more.

But keep in mind that if you’ve picked a cheap or very basic private health insurance plan, your benefits compared to what you may have received in the public health scheme may very well be limited in comparison. The devil is in the details, that’s why it’s important to read the fine print carefully or work with an advisor to help you understand the terms of your coverage.

So which system is “better” depends on the plan you chose. There are poor plans available on the private market and being a bargain hunter might mean that your quality of coverage might be weaker than what would have been provided by the statutory scheme. So always seek expert advice, take the time to dig into the terms or let your broker do the research for you, so that you don’t miss anything in the fine print!

MYTH #6: Being privately insured means more paperwork

No, it does not. Many believe that having private medical insurance in Germany means that making a claim is a painful and lengthy process. This is simply not the case with most private health insurance providers being on their way to being completely digitised these days. To make a claim for medical treatments, prescriptions or consultations, often all you need to do is upload your invoice or receipt via your insurer’s mobile app. Most doctors provide you with an invoice at your visit with 30-day payment terms. You are usually swiftly refunded your money via your bank account once you’ve uploaded a photo of your documents to the designated app.

MYTH #7: German private health insurance contributions increase much more than in the public scheme

Not true. Again, this is completely unfounded and is totally dependent on your unique situation. When it comes to your health insurance, always look at the details! Premiums for health insurance are likely to increase on average between 3-5% each year. However, this is true for both the private and public health scheme, particularly if you’re a high earner.

Let us explain this in detail. Privately insured persons usually get a letter in November or December which announces the next increase for the following year. You can’t ignore it or overlook it. It’s not ideal (nor fair), but it’s something we have to live with.

Voluntarily insured employees who have public health insurance do not get such a letter every year. This gives those people the impression that they are not affected by the price increase. Meanwhile, their privately insured colleagues moan about premium increases. But this is a misconception. Those earning more than €66.600 gross per calendar year (that´s the number for 2023) who stayed voluntarily in the statutory health insurance scheme, end up paying the maximum amount of statutory health insurance. That’s known, okay. But what they often do not realize is that this maximum possible contribution is linked to the contribution Assessment Ceiling and this is increased by law every year.

So high earners insured in the public scheme also experience increasing contributions. But for employees, it is can be hidden in all the confusing numbers and tax-deductions on payslips. It’s not as obvious as a clear letter from a private health insurance company.

Learn more about the yearly increase of private medical insurance premiums.

MYTH #8: When applying for German private health insurance, you only have to reveal serious, pre-existing injuries or medical conditions

This is not the case. You will need to complete a questionnaire issued by your private health insurance provider before you sign your policy contract. Whilst it’s tempting to omit any minor medical concerns or issues you’ve had in the past that no longer impact your current health, it’s important to be honest in your application and reveal your entire medical history. If you don’t, this could come back to bite you later down the track. You will also have to undertake a medical assessment in order to be privately insured in most cases. Even something as simple as having an allergy can actually cause you a lot of unwanted costs when it comes to making a serious claim. It’s recommended that you thoroughly submit all details of your medical history for the time period specified to be safe. Usually this is the last 5 years. Alternatively, seek your medical records from your family doctor or GP.

MYTH #9: Everything that my doctor prescribes will be covered by my private health insurance

Your doctor maintains a duty of care to administer a treatment or prescribe medications needed to address your medical concerns properly. But this does not mean that you are automatically covered by your German private health insurance provider. This especially applies if you’ve opted for a cheap plan with very basic coverage. For example, treatments such as speech therapy or anything involving natural medicines may not be covered. There may also be circumstances that your private medical insurance provider deems cosmetic rather than medical. Conditions related to hair loss or skin ailments fall within this category. Our best advice to ensure you are properly covered? Opt for a robust plan with detailed coverage. We also recommend seeking the advice of an expert (get in touch with us today!) to help ensure the plan you select is sufficient.

MYTH #10: Opting for private health insurance is disloyal or ‘Un-German’

This is a very old-world view that is inherently wrong. Some hold the belief that those who opt out of the public health scheme in favour of German private health insurance aren’t being loyal to the country and the social security system it offers. This notion is very unfair. And in fact, you’ll realise that without the private medical insurance system, the German healthcare system wouldn’t be what it is today. German healthcare is widely regarded for its quality. But the reality is, the private health system subsidises a lot. This is because doctors get paid significantly higher by privately insured patients which greatly offsets the financial loss they encounter from treating someone publicly insured. The whole ecosystem of healthcare in Germany benefits from those who pump money into the private system. Without it, the public system would suffer.

So, there you have it!

11 common myths about private health insurance in Germany debunked

Did any of the above surprise you? Did it impact on your decision to opt for private health insurance over statutory insurance? Tell us in the comments below or get in contact to discuss your options with us further. We’d love to hear from you!

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