Statutory health insurance vs. private health insurance

Patients in Germany have access to a two-tier or dual insurance system. Depending on your circumstances, group membership and profession, you can choose between statutory and private health insurance. However, the choice can be difficult: Many factors influence the question of which form of insurance is best for you. Below you will find a comparison of the most important information on statutory and private health insurance.

SHI and private health insurance: two pillars of healthcare

The German healthcare system is made up of various players and institutions. These include the statutory health insurance funds and private health insurers. Their task is to protect insured persons from financial risks by reimbursing health care costs.

In general, health insurance is compulsory in Germany for both inpatient and outpatient treatment, which means that all residents must have health insurance.

Who can choose between statutory and private health insurance?

The fact that there are two types of health insurance in Germany does not mean that everyone is allowed to choose between them.
Only certain groups of people have the option of taking out private health insurance (or being voluntarily registered with a statutory health insurance fund). Everyone else is automatically insured under the statutory health insurance system.
The groups of people who can choose between voluntary membership of a statutory health insurance fund and private health insurance are

1. Self-employed persons and freelancers: If you work as a freelancer or self-employed person, you can take out private health insurance
2. Civil servants entitled to benefits
3. Employees with an income above the annual income limit (JAEG) or compulsory insurance limit (69,300 euros per year, as of 2024)
4. Students who are exempt from compulsory insurance
5. Househusbands and housewives with an income of less than 485 euros per month (as at 2024)

For all other groups of people, membership of a statutory health insurance fund is automatic.

The most important differences between statutory health insurance and private health insurance

Both statutory health insurers and private health insurers are responsible for covering all or part of the costs of health care so that the insured person does not have to pay out of their own pocket.
However, there are important differences in terms of both the insurance costs and the scope of services that are covered.

The costs

The cost of membership in a statutory health insurance fund is determined by law and depends on your gross income.
Every person with statutory health insurance pays between 15 and 17 percent of their gross income each month. The contribution is calculated as follows: The general contribution rate (with sickness benefit) is 14.6 percent. The reduced contribution rate (without sickness benefit) is 14.0%. In addition, there is the supplementary contribution, which is between 0.8 and 1.9 percent depending on the health insurance fund.

However, there is a limit for calculating your GKV contributions. Above the income threshold - 62,100 euros per year (as of 2024) - your gross income is not used to calculate your statutory health insurance costs. The maximum contribution for statutory health insurance (calculated with regard to the average additional contribution) is therefore €1,019.48 per month (as of 2024).

Private health insurance companies calculate their costs according to private-sector principles. This means that prices are proportional to the scope of benefits of the tariff, your age and your state of health when you join private health insurance. A health check is therefore necessary to join a private health insurance company. This is how the price is determined when you join private health insurance.

Subsidies, allowances and co.

Depending on your profession or group of people, you may be entitled to a subsidy or allowance for your statutory or private health insurance - for example from your employer or employer.
It is important to inform yourself about this in order to find out which form of insurance suits your circumstances.

Health questions

If you want to take out private health insurance, you must answer health questions and, if necessary, undergo a health check.
All questions must be answered carefully and completely - because it depends on whether the insurer has to provide benefits later. If the risk of illness is too high, your application for private health insurance may be rejected. In this case, however, you have the option of insuring yourself with statutory health insurance and taking out supplementary health insurance. The health questions vary depending on the insurance company. However, you can expect questions on the following topics

• General state of health, as well as age, height, weight
• Past contract refusals, terminations or terminations
• Use of medication
• Ability to work
• Examinations, treatments and operations
• Psychotherapeutic treatments
• Cancer, HIV infection
• Disabilities or physical ailments

It is important to know that the costs of private health insurance increase proportionally with increasing age. As a result, the cost of private health insurance increases in the retirement years. However, there are at least two solutions to this problem. The most sensible solution is to choose a private health insurance plan with old-age provisions at an early stage. If you take out private health insurance when you are young and healthy, the costs are relatively low. A plan with old-age provisions allows you to invest a little more in the first few years of your private health insurance so that the plan doesn't become too expensive later on.

Another option for saving on your private health insurance tariff is private health insurance with a deductible. In this case, you agree with the insurer that you will pay a certain proportion of the health care costs incurred.

The services

As in the case of costs, the scope of benefits of the two types of insurance is similar. SHI benefits are regulated by law. The variations between the health insurance companies are minimal and are limited to minor additional benefits. The mandatory benefits of a statutory health insurance fund include, for example

• Inpatient treatment in hospital
• Home care during illness
• Medical and dental services
• Psychotherapeutic treatment
• Supply of remedies and medicines
• Rehabilitation services

Depending on the statutory health insurance company, you may find additional benefits on offer, such as cover for some early diagnostic examinations or savings rates.

The scope of benefits offered by private health insurance companies is completely different. Their benefits are not defined by the German Social Code, but are agreed in the contract between the policyholder and the insurance company. Important benefits that a private health insurance plan should include in order to guarantee better insurance cover than statutory health insurance are, for example

• Free choice of doctor: Private health insurance plans can allow you to freely choose your doctor in the event of illness. If you want to be treated by a particular specialist, choose a private health insurance plan with free choice of doctor
• Doctors' fees: Doctors charge according to the scale of fees for dentists (GOZ) or doctors (GOÄ), which prescribe standard and maximum rates. Some private health insurance plans also reimburse the costs of specialists and private clinics that charge according to standard rates
• Dental services: Good tariffs cover 100 percent of the costs of dental treatment and 80 to 90 percent of the costs of dentures, as well as orthodontics
• Alternative practitioners: There are private health insurance plans that cover the costs of services provided by alternative practitioners

You can also add other modules to your plan, which may not be essential, but are very useful for complete insurance cover:

• Inpatient treatment: You can choose a private health insurance plan that also reimburses the costs of inpatient treatment above and beyond the provisions of the Hospital Remuneration Act, the Federal Nursing Rate Ordinance and the so-called case flat rate agreement
• Rehabilitation and follow-up treatment: If you do not receive benefits from pension or statutory accident insurance, private health insurance can cover rehabilitation and follow-up treatment costs

The benefits provided by statutory health insurance depend on the legislator. This means that there may be changes to the scope of benefits covered by your health insurance. In contrast, the insured benefits of private health insurance are contractually agreed and may not be changed as long as the contract is not amended. This offers you more security when it comes to your health insurance cover.

Further differences

The differences between statutory health insurance and private health insurance are not limited to the tariff costs or the scope of benefits covered. Other important differences are

• Occupation-specific tariffs: Private insurance companies offer tariffs that are specifically tailored to certain occupational groups (such as civil servants, students, doctors)
• Insurance for family members: Your children are insured free of charge with your statutory health insurance company. If you have private health insurance, you will have to pay extra for co-insurance
• Waiting times: People with statutory health insurance usually have to wait longer for an appointment than private patients. This is not directly related to private health insurance, but is a consequence of it
• Billing: If you are insured with a statutory health insurance provider, the treatment costs are covered directly by them. Private health insurance companies, on the other hand, reimburse the costs after you have already paid the bill

Change insurance or change tariff?

If you know the differences between private health insurance and statutory health insurance, you may have considered switching to one or the other, or even to your private insurance provider. However, you need to consider a few things and check whether you meet all the necessary requirements. Three cases in particular are tricky:

• Switching from statutory health insurance to private health insurance: To do this, you need to make sure that you belong to the group of people who are allowed to take out private health insurance in the first place. Certain time limits are also important - for example, how long your income as an employee is above the compulsory insurance limit
• Switching from private health insurance to statutory health insurance: It is not always easy to switch back to the statutory health insurance system. In principle, you are no longer declared exempt from insurance due to your living or professional circumstances. However, if you are over 55 years old, switching back will be difficult
• Changing private health insurer: Changing private insurer is usually associated with financial losses. This is particularly critical if you have chosen a tariff with age-related deferrals. In this case, you cannot always take the money you have invested with you to your new insurer and, even if this is possible, you will always lose some of it. Therefore, it often makes more sense to stay with the same insurer and switch tariffs

The differences at a glance: A comparison of advantages and disadvantages

If you would like to get a general overview of the advantages and disadvantages of statutory and private health insurance in comparison, we have put together a table of the most important differences for you here:

Statutory health insurance

• Open to everyone in principle. Only the return to statutory health insurance becomes difficult from the age of 55
• No health check
• The costs depend on income. SHI contributions are calculated up to the contribution assessment ceiling
• Benefits are prescribed by law and are variable
• Healthcare costs are covered directly by health insurance
• Family members are insured free of charge
• No profession-specific tariffs
• Only doctors licensed by health insurance companies
• Treatment by doctors on duty
• Admission to the nearest suitable clinic
• Mostly multi-bed rooms

Private health insurance

• Only certain groups of people are allowed to take out private health insurance: self-employed and freelancers, civil servants entitled to benefits, employees with an income of over €69,300 per year (as of 2024), students, househusbands and housewives
• Admission after health check, there is a possibility of rejection
• The costs depend on the benefits booked, age and state of health of the person to be insured
• Benefits are contractually agreed. They are therefore customized and can only be changed through new contracts
• Broad scope of benefits: alternative practitioners, dental benefits
• The PKV reimburses costs incurred for which the insured person must first pay out of their own pocket
• No free family insurance
• Occupation-specific tariffs
• Free choice of doctor
• Free choice of clinic, in some tariffs also private clinics
• Treatment by head physician
• Mostly single or twin rooms

Not for everyone, but private health insurance usually makes more sense

If you compare the insurance products offered by statutory health insurers and private health insurers, it becomes clear: The scope of benefits offered by private health insurance is generally more attractive. However, this comes with the disadvantage that private health insurance is only a sensible option from a cost perspective under certain circumstances. SHI contributions are income-dependent, while private health insurance costs depend on various factors: benefits booked, age, health status and occupation at the time of taking out private health insurance.

If you take out private health insurance at a young age or secure it in advance with an optional tariff or qualifying insurance, you can get cheaper rates. However, you must be aware that membership of a private health insurance scheme is only available to certain groups of people. However, if the requirements are met, private health insurance is usually a sensible health insurance option.