Proposals have been put forward by the Commission regarding the specified matter.
Chill, folks. Let's break down what's happening with health and long-term care insurance contributions in Germany.
The DAK, a major health insurance provider, has issued a dire warning about significant contribution increases. They're not happy about the future loans planned by the federal government in 2025 and 2026 to stabilize the social security funds. DAK CEO Andreas Storm spoke out in Berlin, urging for a stability pact with permanently higher federal subsidies for health and long-term care, and an "income-oriented spending policy."
The reason behind the warning comes from a new study by the Berlin Iges Institute commissioned by the DAK. According to this study, contributions for statutory health and long-term care insurance are expected to rise by 0.2 percentage points each at the start of 2026. In 2027, a further increase of 0.3 percentage points in health insurance and 0.2 percentage points in long-term care insurance is expected. This means the contributions for insured individuals and companies will continue to escalate.
You might be wondering why. Well, if no measures are taken, the contribution rate in statutory health insurance is expected to reach around 20 percent by 2035. Right now, the current general contribution rate is 14.6 percent with an additional 2.9 percent from the funds, totalling 17.5 percent. Storm referred to this figure, stating, "The Iges projection shows that the federal government’s budget planning for the healthcare sector is a disaster."
The funds with a repayment obligation, as planned by the government, are seen as a short-term solution by the DAK. They warn that these loans may cause a "yo-yo effect," threatening the functionality of the German social security system.
Time to Embrace Reforms
The Iges study suggests permanent federal subsidies of ten billion euros per year for statutory health insurance starting from 2026. This is to cover costs associated with insuring recipients of unemployment benefits. Additionally, reforms should ensure that spending growth does not exceed income growth from 2027 onwards. Long-term care insurance is recommended to receive a one-time subsidy of 5.2 billion euros in 2026 to counteract the burden from the COVID-19 pandemic, potentially permanently stabilizing contribution rates.
The DAK and Iges Institute propose a range of measures to prevent continuous contribution increases, including revising the long-term care financing model, boosting efficiency and cost control in healthcare, encouraging supplementary insurance, and implementing demographic-related policy reforms to tackle the challenges posed by Germany's aging population.
So, brace yourselves for some changes. Health and long-term care insurance contributions in Germany are about to see some shakeups, but with the DAK's proposed measures, we might just steer clear of the steep contribution hikes on the horizon. Stay tuned for more updates on this issue!
[Sources: ntv.de, rog/AFP]
- Health Insurance Funds
- Long-term Care Insurance
- Health Insurance
- The DAK, a significant health insurance provider, has issued a warning about an imminent increase in health and long-term care insurance contributions.
- Andreas Storm, CEO of the DAK, urged for a stability pact with permanently higher federal subsidies and an "income-oriented spending policy" in Berlin.
- The reason behind the warning is a new study by the Berlin Iges Institute predicting a 0.2 percentage point increase at the start of 2026, and further increases in 2027.
- By 2035, the contribution rate in statutory health insurance is expected to reach around 20 percent, compared to the current 17.5 percent.
- The DAK sees the federal government's planned funds with a repayment obligation as a short-term solution, warning of a "yo-yo effect" that may threaten the functionality of the German social security system.
- The Iges study suggests a need for permanent federal subsidies of ten billion euros per year for statutory health insurance starting from 2026.
- Reforms are proposed to ensure spending growth does not exceed income growth and to provide a one-time subsidy of 5.2 billion euros to long-term care insurance in 2026.
- Measures to prevent continuous contribution increases include revising the long-term care financing model, boosting efficiency, encouraging supplementary insurance, and demographic-related policy reforms.
- In light of these predictions, it's time to brace for changes in health and long-term care insurance contributions in Germany.
- With the proposed measures, we might just avoid the steep contribution hikes on the horizon.
- The study also suggests permanent federal subsidies for long-term care insurance to counteract the burden from the COVID-19 pandemic.
- Health Insurance Funds are expected to undergo significant changes due to the impending contribution increases.
- Long-term Care Insurance is also set to experience adjustments to cope with the predicted increases.
- The proposed measures aim to tackle the challenges posed by Germany's aging population.
- Efficiency and cost control in healthcare are key aspects of the proposed measures to stabilize insurance contributions.
- Encouraging supplementary insurance is part of the proposal to prevent continuous contribution increases.
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