Taxes in Europe Database v2
The legal foundations for statutory health insurance are to be found in Book V of the German Social Code (SGB V), in the Farmers Health Insurance Act and in the Reich Insurance Code.
Federal Republic of Germany
In the Federal Republic of Germany around a 90 % of the population is covered under statutory health insurance.
In principle, all employees are compulsorily insured under statutory health insurance if their gross pay exceeds € 400 per month and does not exceed a defined upper limit (2011: € 44,550 per year respectively € 3,712.50 per month). Insured persons are free to choose the health insurance fund they wish to be insured with.
Compulsorily insured are in particular:
- employees, including those undertaking vocational training for value,
- recipients of unemployment benefit or unemployment assistance,
- farmers and certain people connected with the agricultural enterprise,
- artists and those in the publishing professions, in accordance with the Artists Social Welfare Act,
- disabled persons employed at sheltered workshops and at institutions, homes or similar establishments,
- university students,
- trainees, apprentices without remuneration and apprentices in second-chance education,
- old-age pensioners/pension applicants who have been insured for a specified length of time.
Beyond this coverage since April 2007 all persons who are not protected in case of disease and who have been insured under statutory health insurance before the loss of protection are compulsorily insured. In case of disease also persons without protection who have not been insured in Germany at all (under statutory or private health insurance) will be compulsorily insured if they are - systematically - assigned to the statutory health insurance.
In addition, many people carry voluntary health insurance (for example, the self-employed) or are insured as family members. The option to obtain voluntary insurance is in principle open only to those who were previously compulsorily insured or insured as a family member. Provided certain conditions are met, spouses or partners of the insured, as well as children, are covered as family members, with no need to pay contributions.
In general, employers and employees each pay half of the contribution rate. The employees have to pay a 0.9 % additional income linked contribution. Health insurance funds can demand additional contributions from the insured employees/pensioners.
In general, employers have to pay social contributions for pensions, health care, long-term care, unemployment, work-related illnesses and /or accidents.
They also do have to pay their share of the maternity benefit for an employee on maternity leave (in general six weeks before and eight weeks afrt confinement) as payments by statutory health insurance funds are limited to € 13 net average salary per day respectively € 390 per month. Maternity benefit is calculated on the basis of the average take-home pay in the last three calendar months, or thirteen weeks, before the statutory period of maternity leave before the birth.
For more information on maternity benefit see update ‘Social security contribution - Health insurance (Employees)'
Basis of assessment is the employee's assessable income up to a defined contribution assessment limit which is adjusted each year (2011: € 44,550 per year respectively € 3,712.50 per month).
The employer's contribution is capped at a 7.3 % of the defined contribution assessment limit (2011: € 44,550 per year respectively € 3,712.50 per month) if the employee's salary exceeds the limits.
€ 4,800.01 per year respectively € 400.01 per month
€ 44,550 per year respectively € 3,712.50 per month
There are special regulations for employees in private households and industrial or commercial workforce in marginal employment with an income up to € 400.00 per month (€ 4,800.00 per year).
In general, the income is free of any deductions for the employee. But the employer has to deduct flat rate contributions:
Private households: a 14.34 % consisting of
2 % flat wage tax
5 % for health insurance
5 % for pension insurance
1.6 % for accident insurance
0.74 % allocation to compensate employer expenses in case of illness or maternity
Other employers: a 30.74 % consisting of
13 % for health insurance
15 % for pension insurance
Furthermore, there is a framework for employees with an income between € 400.01 and € 800.00 per month (€ 4,800.01 and € 9,600.00 per year; so-called ‘earning within the sliding pay scale’). An employee with an income within this range has to pay standard SSC on a reduced basis so that part of the income is free of SSC deduction whereas the employer has to pay his share on the basis of the regular gross income.
The reduced basis for employee SSC is calculated according to the formula:
F x 400 + (2 - F) x (income - 400).
‘F’ is the so-called ‘factor F’ (in 2011: 0.7435). Federal Ministry of Labour and Social Affairs annually gazettes the ‘factor F’ to be applied.
There is a uniform contribution rate fixed by the federal government amounting to a 15.5 % in 2011. Employers have to pay a contribution rate of a 7.3 % whereas employees pay a share of an 8.2 %. Furthermore, the health insurance funds may be entitled to levy an additional supplement which the insured persons (employees/pensioners) have to pay on their own.
Contributions have to be paid by the end of each month.
The statutory health insurance funds are like all social insurance funds self-administered corporations under public law. This means that they on one hand carry out their legally mandated tasks under government supervision but on the other hand they are organisationally and financially independent.
All contributions are collected by the health insurance funds, forwarded to the national 'health fund' and redistributed from the 'health fund' to the individual insurance funds according to specific criteria set by the federal government.
Sources: www.bmg.bund.de, www.deutsche-sozialversicherung.de
Employees' compulsory contributions to statutory health insurance are displayed in the update 'Social security contribution - Health insurance (Employees).