German government makes health insurance cheaper 

Health Minister Jens Spahn has announced "good news for health insurance clients" starting from 2019: the government will shift the burden of cost to employers and pension funds.

Daria Sukharchuk
Daria Sukharchuk NewsMavens, Central & Eastern Europe
German government makes health insurance cheaper  - NewsMavens
Health card, Pixabay

Why this story matters:

German employees pay a hefty sum for their health insurance: around 350€, with about half of it paid by their employer. For the self-employed, it's even more expensive -- minimum 345€ a month. Under the new law, the self-employed will pay a minimum of 171€, and for employees and pensioners, most of the costs will shift to the employers and pension funds.

Insurance companies will not be allowed to accumulate reserves that exceed one month's worth of their expenses -- and any funds higher than that will have to be given to the Health Care Fund.

While consumers are happy about this change, businesses are not: it will increase their staff expenses and reduce competition. It might also be an incentive to hire fewer people. 

Details from the story:

  • Currently, health insurance costs are high in Germany -- especially for the self-employed, who cannot rely on an employer to pay half of their insurance costs.
  • The new government has promised to lower these costs at the expense of the insurance companies who have accumulated vast monetary reserves.
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