Health Insurance Crisis: Deficit Leads to Higher Contributions for Policyholders
Insurance providers are issuing warnings: There's a growing need for more individuals to contribute higher premiums.
As we head into 2025, Germany's statutory health insurers are struggling to stay afloat. Financial reserves have hit their limit, and the outlook for the year is grim. With the new government in place, an increase in additional contributions seems like an all-but-inevitable reality for policyholders.
Sommerfeld - The ** contributions spiral** continues to tighten its grip on statutory health insurance policyholders. The heads of the Federal Association of Statutory Health Insurers (GKV-Spitzenverband), led by Doris Pfeiffer, have sounded the alarm and made clear demands of Chancellor Friedrich Merz. "We aim to break the contribution spiral, but we need immediate action," Pfeiffer stated.
Contributions on the Rise - Health Insurers Pull the Plug Early
For months, statutory health insurers have been raising alarm bells over anticipated premium increases. Urgent reforms are needed to improve the financing situation and stabilize premiums. Association figures show that the deficit for statutory health insurers in 2024 totaled 6.2 billion euros. "This loss wasn't foreseeable," stated Pfeiffer.
Due to the financial situation, statutory health insurers significantly increased their additional contributions at the beginning of 2025. The average additional contribution rate for statutory health insurance was bumped up to 2.5 percent in 2025. However, Pfeiffer indicates that this rate isn't enough, with a minimum of 2.6 percent being necessary for 2026.
By May 2025, there had already been eight additional contribution rate increases. "As of July 1, there are six more applications from health insurers who want to raise their contributions," Pfeiffer revealed. 2024 saw 40 increases in additional contributions, according to the association's figures.
Reserves Running Out - Spending Moratorium Demanded
According to Pfeiffer, insurers have run out of room to maneuver due to decreasing reserves and provisions. The statutory minimum reserve for statutory health insurers, which should amount to 20 percent of a monthly expenditure, was only at seven percent at the end of 2024.
The heads of the GKV association are pushing for a spending moratorium, or cost-cutting measures, to help bridge the gap between income and expenditure.
Long-term Care Insurance in Danger
The outlook for long-term care insurance remains bleak. Without additional funding, care funds could become dependent on liquidity assistance. One fund already applied for this assistance in 2025, with more likely to follow in the second half of the year.
To stabilize long-term care insurance, the federal government would need to offset the 5.2 billion euro COVID-19 measure funded by the care funds. In addition, the pension insurance contributions for caring relatives would need to be permanently covered.
Stay tuned for more updates on the health insurance crisis in Germany.
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- The struggle for Germany's statutory health insurers to remain solvent has also cast a shadows on the financial sector, as the increased contributions have started to affect the science and health-and-wellness budgets, causing concerns about the long-term sustainability of these essential services.
- In the midst of the ongoing health insurance crisis, the desperate search for solutions has expanded beyond healthcare, with policymakers considering drastic measures such as dipping into the reserves of pension and long-term care insurance, or even implementing temporary austerity measures in areas like science, health, and finance, to help bridge the gap in funding.
