GERMAN HEALTHCARE SYSTEM

Germany’s system for universal health care coverage is the oldest in Europe. It dates back to social legislation passed in the 1880s by Otto von Bismark, and its underlying principles of social solidarity and pay-as-you-go financing remains the valid to this day.

Germany has a highly decentralized health care service, with each of its 16 states sharing responsibility with the central government for the building and upkeep of health care facilities. It also does a good job of mixing private and public cover through a state-regulated health insurance health fund which exerts some control over operating costs while allowing competition to improve health care standards among the different insurance funds and private insurers.

THE GERMAN HEALTHCARE SYSTEM

Principles
Public health insurance funds cover about 90 percent of the population. These funds are managed by independent, nonprofit, and non-governmental organizations regulated by law. Each employee is free to choose among the statutory funds in their region; but as 95 percent of health benefits are predefined, they all basically provide the same level of coverage.

Reimbursements
Recently, German law-makers have introduced ‘co-payment’ to the system so as to better control the ever increasing health care cost. You now have to pay a € 10 co-payment for prescription drugs, doctor’s visits, and hospital stays. The rest of the bill is settled directly by your insurance provider.

1. In-hospital treatment – Most inpatient treatments are fully covered. The definition of cosmetic and non-covered treatments is based on DRGs (diagnosis-related groups) that were introduced in 2004.
2. Out-of-hospital treatment – It is recommended to go through your general practitioner before seeing a specialist as your co-payments may be higher if you do not. Preventive medical checkups are excluded from co-payments, along with children under 18.
3. Medicine – Generic drugs are also reimbursed with a co-payment, the scale of which depends on the cost of the medication. Once again, no co-payment for children under 18.
4. Dentistry – Some dental treatments are covered, and you can expect to pay between 30% and 80% out-of-pocket for dental work if you do not have supplemental dental insurance.

Funding
In 2007, Germany spent about 10.4 percent of its GDP on health care. About 77% of this spending came from statutory funds, with the remaining 23% coming from private insurance or individuals themselves.

Statutory funding is based on salary, and does vary from fund to fund with an average of about 14% per employee. These contributions are deducted from the employee’s pay slip with employer and employee sharing the bill. This is then ‘pooled’ into a national health fund, which allocates resources to each statutory fund based on a risk-adjusted contribution formula.

Private Insurance
24 percent of Germans opt for supplemental coverage, which entitles them to benefits not offered by the public plans. Public officers, self-employed people and employees with a gross income above a minimum income requirement of about € 50,000 (adjusted yearly) may opt out of the statutory fund system and receive full coverage through private health insurance directly.

Abroad
As with all other EU nations, German insurances will provide you with limited cover for travel within the EU. You will have to pay the medical costs directly, before filling out the necessary forms in order to apply for a reimbursement once you return to Germany. You will be reimbursed for the amount that the German system would have paid for the treatment – which can sometimes be lower than the actual cost you paid.

Please note that evacuation is not covered unless you opt for private travel insurance.

Should you travel to a country which is not in the EU, then you need a private travel insurance not only to cover your evacuation or repatriation needs, but also your medical needs.

YOUR INSURANCE OPTIONS

Before leaving, we recommend that you get in touch directly with your insurance provider to ask if it does offer the possibility of health insurance abroad. Should they not, we can suggest some useful providers who offer international health insurance solutions. You should also ask whether you can suspend your supplementary insurance policy upon leaving, as doing such would enable you to resume your insurance cover when you return to Germany on the same conditions as prior to your departure.

If you have questions, or need some guidance, give us a buzz .