How to pay less for german health insurance

German health insurance can be pretty expensive, especially the PUBLIC health insurance. Good news: Everyone in Germany can lower their health insurance costs (in public & in private) by switching to a health insurance plan with a deductible.

Key Takeaways

  • You can pay less for German health insurance by choosing a deductible or receiving a cashback.
  • A deductible describes the medical costs you have to pay before your health insurance will cover the payments.
  • Cashback is a payment you can receive from your health insurance company for occurring very little (or no) medical costs.
  • The right health insurance (public or private) & the right health insurance plan depends on the individual case.

Introduction: Health insurance costs in Germany

Health insurance premiums in Germany can be quite expensive. As a publicly insured person, you pay 14.6% plus an additional contribution of on average 1.6% of your monthly gross income just for public health insurance alone (read about the contributions to the other social security insurances here). In contrast, as a privately insured person, you pay an individual monthly contribution mostly based on your entry age, coverage, and health status when you apply for private health insurance. Read more about private health insurance here.

Even though both health insurance systems are fundamentally different (public health insurance is based on solidarity), you can reduce your contributions by using the same tools. The following two things are available for both:

  • Deductible: By adding a deductible to your health insurance (public or private), you pay for medical bills yourself first before your health insurance starts covering. As you share the risk for costs with your insurance, you get rewarded with lower monthly health insurance contributions.
  • Cashback: Some public health insurance and almost all private health insurances offer a cashback if you are a good customer and don’t occur any costs to your health insurance company. When paying for medical bills yourself instead of sending them to your insurance company, you will receive a cashback.

Although you can pay less for German health insurance contributions by the same means, both systems work differently. How exactly you can reduce your contributions to public or private health insurance, will be explained in this article.

How to Pay less for German PUBLIC health insurance

Since public health insurance in Germany is very closely tied to the state, it is highly regulated. Hence, you have little flexibility to reduce your public health insurance costs. Nevertheless, most public health insurance companies offer different plans. Thus, to reduce your costs, you need to switch to a public health insurance plan (e.g. within TK) that either includes a deductible or a cashback. But what does that mean exactly?

  • Deductible for public health insurance: A deductible describes the medical costs you have to pay before your health insurance will cover the payments. So if you choose a deductible, it means that you have to pay part of your medical bills yourself. Accordingly, a deductible only makes sense if you have few, if any, annual medical bills. In other words, if you are healthy. Thus, if you have a deductible of 400€, you will have to pay 400€ annually before your health insurance will pay. This type of premium reduction will directly affect your monthly premium. The second option won’t affect it directly.
  • Cashback from public health insurance: Unlike the deductible, cashback does not directly affect health insurance premiums. In fact, cashback is a payment that you can receive from your health insurance company as a lump sum if you are eligible (usually paid in the Summer after an insurance year). You will only receive this if you use your health insurance on a limited basis. This means concretely, only for treatments that are excluded from the cashback. You can read more about public health insurance cashback here.

Some insurance companies also offer combination plans. These include both a deductible and a cashback. With such a plan, you can reduce your monthly costs while receiving cashback after the insurance year. However, combination plans in the public health insurance usually get an intermediate value, between the highest possible deductible and the highest possible cashback. The maximum cashback you can receive is 600€ (regulated by the government) while the maximum deductible you can choose is 1.000€

It is important to note that these plans are not suitable for everyone. Thus, if you have to pay your entire deductible, it will not have any added value. The same applies to cashback if you have too many medical bills during the year. Additionally, it should be mentioned that these add-ons will not make a significant difference. This is only the case for privately insured people, but more on that below.

How to Pay less for German PRIVATE health insurance

Private health insurance works a little differently than public health insurance. Here, the state is not involved, which leads to much more flexibility. In private health insurance, you can choose your own coverage, deductible, cashback, and sick leave money. This enables you to change your insurance premium and also reduce it.

But beware, it is not recommended to lower your premium by decreasing your coverage or sick leave money, as well as increasing your deductible. Especially for employees it is generally speaking better to have a low deductible, as the employer pays half of their health insurance contributions (deductible amount has to be paid by the insured person alone).

However, let’s first look at the points that you can change to pay less for your health insurance:

  • Deductible for private health insurance: In private health insurance, you can also opt for a deductible. This can be up to 5.000€. You can choose between two models. The deductible, where you pay the costs up to the selected amount, or a deductible, where you pay a part of all upcoming costs yourself. In the first model, you pay all medical bills yourself until you reach the threshold of your deductible. The partial deductible works differently. For example, if you need medication, you would have to pay 10€ of the bill. If you go to the doctor 20€ deductible each. This would add up to a maximum amount of the chosen deductible. The third deductible model is that you pay a percentage of the total medical bills up to a certain amount (e.g. 10% of bills up to 500€).
  • Cashback from private health insurance: You can also get cashback in private health insurance if you use your health insurance only conditionally. However, in contrast to public health insurance, the cashback can be much higher. With the right private health insurance, you can easily get several hundred euros, up to a few thousand euros back. How exactly this works and how much to get can you read here.

These two methods are very suitable if you want to pay less for your German health insurance. Especially with the cashback, you can easily get a lot of your health insurance costs back. It is very important, to select the right private health insurance company (and plan) with the deductible and cashback model that suits your individual needs the best (depending on how you plan to use your private health insurance).

How much money can you save with a deductible, cashback, or by switching from public health insurance to private health insurance? Let’s find out together.

Conclusion: How Can you reduce your health insurance Costs?

For health insurance in Germany, deductible and cashback are the two essential parts to reduce your costs in a clever way. A health insurance (public or private) with a high deductible and even higher cashback will give you the best coverage while costing the lowest money. It is much better to reduce your health insurance costs that way than lowering your coverage or daily sick leave money. This can have unpleasant consequences on your life if the worst happens and you suffer a serious health impairment.

As with any other insurance, health insurance depends on the individual needs. This implies that different rates may be considered for each individual. For example, a high deductible makes more sense for self-employed than for employees. This is because as a self-employed person, you pay the entire cost of health insurance, while employees only pay 50%. The deductible, in turn, must be paid in full by the insurance holder (you).

If you are not sure about which public health insurance to choose, the calculator on that page will help you to find the best solution. The different options are explained to you on the website. If you need help choosing a private health insurance plan and want to know what is best for your individual situation, then feel free to book a free meeting with us here.

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