The biggest increase in health insurance premiums is imminent! What you need to know now

The average additional contribution for statutory health insurance (GKV) will probably increase in the coming year from 1.7 to 2.45 percent, predicts the umbrella organization of health insurance companies (BKK). Although an increase in this amount is not certain, statements from health insurance companies indicate a significant increase.

What does the additional contribution mean?

Health insurance companies receive allocations from the statutory health fund. All costs not covered by these allowances are paid by insurance companies from additional premium income. The health insurance companies themselves determine the amount of their additional contributions.

Currently, all people with compulsory health insurance pay 14.6 percent of their gross income as a basic contribution to health insurance companies. Additional contributions average 1.7 percent.

The employer usually pays half of the contribution and the additional contribution, the employee pays the rest. The self-employed pay the full contribution and pensioners also pay half.

Do health insurance companies have to increase their additional contributions from 2025?

No. Health insurance companies continue to freely determine their additional contributions.

With an average additional contribution of 1.7 percent, there is already a large gap between the lowest additional contribution of 0.9 percent and the maximum value of 2.7 percent. In principle, no law obliges an individual health insurance company to increase its contribution during the next year.

However, insurers face rising costs. Therefore, many health insurance companies are practically forced to increase contributions.

Does my health insurance company also increase its contributions?

Most likely. According to the umbrella organization BKK, all cash registers are missing money. It will be increasingly difficult for health insurance companies to close this gap in the face of rising costs without increasing contributions.

BKK data shows that the entire contribution range is expected to increase by 0.7 to 0.8 percentage points from next year. Current cash registers, which are relatively expensive, will also continue to become more expensive. However, it seems very possible that the distribution of funds will change within this range. Health insurance that is cheap today will not necessarily be cheap in twelve months. Therefore, consumers should carefully consider their options in the event of an increase.

What can I do if my fund increases the contribution?

In the event of a premium increase, policyholders have a special right of termination with two months' notice. The cancellation must be received by the health insurance company no later than the end of the month in which the contribution increase is first charged.

The easiest way to find a cheaper supplier is to compare prices like FOCUS online. Select the cheapest cash register, fill in the details and that's it. The new fund even takes charge of the extinction of the old one.

Could the increase be even more significant?

Yes. The BKK umbrella organization foresees an increase in the additional contribution based on the current legal situation. This is likely to change in the coming years: The federal government is discussing measures and reforms that will increase costs, at least in the short term. Insurers expressly point out the risk of even greater cost increases.

Why are additional contributions increasing?

The cash registers are short of money. The aging of society makes healthcare more expensive: older people need more treatment than young people. Additionally, there are cost increases due to wage increases and inflation.

For this reason, additional contributions have been increasing for years. But apparently it's not strong enough so far. According to calculations by the central organization BKK, the average additional contribution this year should be 1.81 percent instead of 1.7 percent in order to cover all costs, reports Handelsblatt. However, with very little money currently flowing into the coffers, health insurance companies have to dip into their reserves.

This won't last forever. Hence the threat of increased premiums.

What do health insurance companies require?

Politicians must reduce health care costs. “Without countermeasures, there is a risk of massive increases in contributions in 2024 and 2025,” the president of the BKK umbrella organization, Anne-Kathrin Klemm, tells Handelsblatt. “There are no financial reserves left in the system.”

Klemm is upset that, in his opinion, the official sickness funds pay for politicians' mistakes: “We have said it before and we mean it. If necessary, the courts will clarify the inadmissible transfer of costs to statutory health insurance.”

Klemm calls for a general rethinking of the health system: more prevention that preserves health instead of treating preventable diseases: “This prevents suffering and saves resources.”

Can politics save money?

Yes, but many times it is not that easy. An example: the hospital reform planned by Health Minister Karl Lauterbach (SPD) aims to reduce healthcare costs in the long term. However, in the short term the changes require a multibillion-dollar transformation fund, which health insurance companies should help finance. This is the case, for example, that many hospitals have to completely reorganize. That drives contributions. A health system is not reformed overnight.

On the other hand, the traffic light coalition could cancel some of its cost-increasing projects. The Medical Research Law, for example, aims to reduce bureaucracy in the approval of medications and treatments. Health insurance companies are bothered by a point that allows pharmaceutical companies to set secret prices for drugs.

“Physicians must choose an affordable therapy for their patients. How can they do this if the price of medicines is not disclosed?” writes the umbrella organization BKK. Politicians have to decide: more incentives or fewer costs?

Can the “traffic light” bring more money to the health system without increasing contributions?

That would be conceivable. In the coalition, the FDP in particular wants to save money. The Greens and the SPD plan to impose a greater burden on people with higher incomes: one possibility would be to increase the contribution limit. Currently it is 5175 euros per month. Income above this is no longer taken into account. Even if you earn one million euros a month, on these 5,175 euros you only pay the basic contribution and the additional contribution. If the basic contribution increases, the GKV's income increases.

The traffic light could raise the salary limit to switch to private health insurance. The annual salary limit determines the salary above which employees can switch to private health insurance. If the government increases the limit, more high-income earners who would otherwise switch will remain in the GKV. That also brings in more money.

Will contributions continue to increase in the long term?

If politicians do nothing, health insurance companies believe the contribution spiral will continue to rise after 2025. But that doesn't have to be the case: for people with low and normal incomes, politicians generally have room to maneuver to stop the increase.