Health insurance obligation Public vs private Suggested private coverage Private costs Is private better? Switching from private to public Key learnings

Summary

Self-employed private health insurance in Germany – your guide

5 mins

March 29, 2022

By Tom Bensley

When you’re a self-employed worker, picking the right private health insurance is crucial, along with learning to do your tax return and creating your own website. The right health insurance could mean the difference between a profitable tax return every year and one you end up owing for. Health insurance, like tax classes and other bureaucratic necessities in Germany, is a complicated structure with lots of jargon to sift through. This is especially challenging for non-German speakers. That’s why we’re here to simplify things for you and reinterpret some of this jargon into plain terms. There are crucial choices you can make with your self-employed private health insurance which will benefit you in important ways, depending on your economic situation.Read on to learn about those choices and help you make this important decision.

Do the self-employed need health insurance in Germany?

Yes. Health insurance is mandatory for people living and working in Germany, whether the insurance is local or from your home EU country. Fortunately for the self-employed, you’ll have more freedom of choice than employees when it comes to the kind of health insurance you select, and what benefits you’ll have.

Public vs private health insurance

Around 90% of Germany’s population is covered by public health insurance, making it vastly more popular than private. The reason for this isn’t because public insurance is superior, but because it is generally better fitted to employees and self-employment rates sit far lower. Trade economics reports that around 9.7% of all Germans are self-employed, or 3.9 million.The pros and cons of private and public health insurance will help to clarify for you which health insurance plan will suit you best. Public health insurance is better fitted for employees and families, with income-dependent fees and coverage for family members.

Public health insurance

Pros	Cons
Family insurance covers spouses depending on earnings and children for free up to a certain age	The majority of special treatments are not covered and waiting times for these kinds of appointments are longer than on a private plan.
Pay an income-dependent monthly fee which covers the majority of visits to the doctor when you present your insurance provider’s card	Regardless of individual needs relating to your health, you cannot adapt your insurance scheme or fees.
The cost of your health insurance is dependent on your earnings. Earn less and pay less, earn more and pay more.	Both high earners and the self-employed pay high fees.

Private insurance on the other hand is favourable for its better service and fixed payment schemes regardless of income.

Private health insurance

Pros	Cons
Doctors and clinics earn more from private insurance companies, meaning the privately insured are offered special treatment: immediate appointments, highly qualified physicians, and private hospital wards	Making the switch to private insurance will make it very difficult to go back to public, and is only possible in exceptional circumstances (see below for how to do this).
Choose from alternative treatments like chinese medicine, osteopathy, homoeopathy, among others.	Because family members are not covered, each member, including children, must be paid for individually.
Private insurance can be much cheaper than public, especially for the young and healthy (i.e. no specific health problems requiring individual treatment). Reimbursements schemes are also possible when these treatments are not needed.	In marriage partnerships where one spouse has public insurance and the other private, the public insurance fee will increase substantially. This happens because both partners’ salaries are calculated into the public fee.
The private fee is fixed regardless of income, meaning high income earners can pay less.	The privately insured pay their medical bills upfront and are reimbursed at a later date.

What should my private health insurance cover?

What you will need your private insurance to cover will ultimately depend on your personal situation. For instance, if you are a young, healthy, unmarried person with no children, your private insurance need only cover the basics:

Patient hospital care
Prescription medical costs
Mental health care
Dental
Pregnancy (if applicable)
Ambulance cover

All of these will be covered by a basic public plan under the major German public health insurance providers like TK and AOK. However, because public healthcare is more expensive for self-employed people and also covers family members, you may be paying much more for the basics than you would under a private plan.Under private, if you have any of the following special circumstances you will need to notify your provider and include them in your coverage:

Special healthcare requirements (chronic illnesses, professional care, certain medications)
Preference for alternative medicines (acupuncture, homeopathy, osteopathy)
Children, ill parents
Priority treatment (specialists, specialist clinics

What does private health insurance cost in Germany?

As explained above, the costs of your private health insurance will depend on your specific situation. It will also depend on your age, occupation, pre-existing conditions, healthcare plan, and voluntary excess.

Selbstbeteiligung

Voluntary excess is called ‘Selbstbeteiligung’ in German and refers to whatever you choose to pay on top of your standard rate. Under a private plan, you can control the amount of voluntary excess you wish to pay—a higher voluntary excess will bring down the cost of your monthly premium.

The average premium for an adult with private health insurance (whether self-employed or employed) is around €400 to €700 per month. It will be significantly less if you’re a student. While employees will receive a 50% rebate by their employer, as a self-employed worker you will have to cover all of the costs. Keep this in mind when considering your specific requirements for a healthcare plan.

Is private health insurance better for the self employed?

In some cases, yes. If you are a high-earning, healthy, and young self-employed person with no family to look after, you may benefit greatly from private health insurance. If you have certain preferences and wish to be given primary treatment when you go to the doctor, private insurance will also be an ideal pick. Knowing whether or not it’s better for you is all about reviewing your personal situation and preferences.

Can I switch from private to public health insurance?

If you wish to remain self-employed full-time, you will not be able to switch from private to public health insurance. You can however switch if you become an employee or reduce your self-employed hours to part-time. If you become part-time self-employed, you are not allowed to have any employees with salaries exceeding €450 per month. Additional required circumstances apply for employees switching from private to public health insurance:

You must be under 55 years old
Your employed income must not exceed €62,350 per year
You must work more than 20 hours a week (you can pair 20 hours of employed work with your self-employed work as a side hustle)
Your monthly income should exceed €1,645 (as of 2021)

The good news is, once you have made the switch to public health insurance while employed, you can return to your full-time self-employed work and keep the public health insurance.

As this blog post likely shows, there are many specificities to choosing your health insurance plan and it is important to consider how they will affect your specific situation. Being self-employed complicates the decision to choose between public and private, because private may be far more beneficial to you, depending on your situation.The important thing above all is to read as much appropriate information as you can and plan and to make sure you have ironed out all of the particulars of your economic and personal situation. Doing this will be of great benefit to your self-employed career.

Key learnings

Health insurance is mandatory for employees and self-employed workers in Germany
Public health insurance is a popular choice for its family coverage and income-dependent fees
Private health insurance is popular for its special treatment options and fixed fees regardless of income
Your private health insurance plan should cover the basics under a public plan and whatever other special circumstances you have
It is possible to switch from private to public health insurance as a self-employed worker, however there is a procedure that must be followed and certain requirements
Choosing the right insurance plan for you is all about getting informed and making decisions that fit your personal situation

ABOUT THE AUTHOR

Tom Bensley

Tom has worked in Melbourne as a film critic and freelance writer. In Berlin, he was a content creator for German fintech Penta and is now at Qonto. His goal is to demystify technical jargon.