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Healthcare Expenditure in Germany
Germany’s expenditure on its health system has been increasing consistently for more than a decade now. It was 497.7 billion euros in 2022.
Germany’s healthcare expenditure has been increasing on average by 4.5% annually since 2009. It was 281.6 billion euros in 2009 and increased to 497.7 billion euros in 2022, a 76.7% increase.
| Year | Germany’s Health Expenditure (in billion euros) | Percentage increase in the health expenditure from the previous year |
|---|---|---|
| 2009 | 281.6 | |
| 2010 | 291.1 | 3.37% |
| 2011 | 296.6 | 1.89% |
| 2012 | 304.4 | 2.63% |
| 2013 | 315.4 | 3.61% |
| 2014 | 329 | 4.31% |
| 2015 | 345 | 4.86% |
| 2016 | 359.4 | 4.17% |
| 2017 | 376.7 | 4.81% |
| 2018 | 393.4 | 4.43% |
| 2019 | 414.6 | 5.39% |
| 2020 | 440.8 | 6.32% |
| 2021 | 475 | 7.76% |
| 2022 | 497.7 | 4.78% |
Why is Germany’s healthcare expenditure increasing so fast?
Here are the main reasons for the increase in Germany’s healthcare expenses.
- Aging population: Germany has an aging population. As of 2024, 25.7 million Germans are 60 or above, accounting for 31% of the country’s population. The situation will worsen even further. By 2050, 27.9 million people will be 60 or above. This accounts for one-third of the German population. Old people require more medical services than young ones. So, the increasing older population directly contributes to the increasing healthcare expenses.
- Inflation: We all know inflation and its impact on the cost of goods and services. The medical field is no different and is affected by inflation.
- Medical progress: Innovation and medical progress are opening up more treatment options for patients. This leads to increased spending and healthcare expenditures.
- Longer life expectancy: Life expectancy in Germany is around 81 years [5]. Statistically, each year costs the health system about twice as much as the previous one.
As you can observe, health expenditures are rising faster than the aging population. For every 1% increase in the aging population, there is an approximate 4% increase in health expenditures.
How does the increasing healthcare expenditure affect you?
There are limited ways for German health insurance companies to cover the increased medical costs. It’s either to
- decrease the medical coverage,
- increase the monthly insurance premium, or
- create aging provision
Public health insurance is decreasing the medical coverage and increasing the premium to cover the increased medical costs.
On the other hand, private health insurance providers are increasing the premiums and creating an aging reserve to compensate for the increasing medical costs.
In short, you have to pay higher health insurance premiums. In the past decade (2004 to 2024), insurance premiums have increased at a rate of 3.2% (private) and 3.3% (public).
Experts predict that public health insurance premiums will increase rapidly in the coming future. They forecast that you’ll pay between 25% and 32% of your gross salary in public health insurance premiums.
Private health insurance premiums will also continue to rise at a rate of 3.2% or above. Private health insurance providers are better prepared for increased medical expenses in the future as they have 336 billion euros of aging reserve.
You can read our guide on the development of health insurance costs in Germany to learn more.
Which health insurance is best for you?
The German health system is one of the best in the world. Both public and private health insurance offer good medical coverage.
However, good private health insurance plans offer better coverage than public insurance. Moreover, private insurance is cheaper than public for high-earners.
Several factors must be considered before deciding between private and public health insurance. To make it simple for you, we developed a “Health Insurance Finder” tool.
You can use this tool to check which health insurance is best for you and why. We also recommend getting advice from an insurance broker or fee-based advisor before deciding.
Insurance brokers and advisors are liable for their advice. This means that if the insurance plan they recommended doesn’t fulfill your wishes, they are liable to pay the damages.
Insurance brokers offer free advice. The insurance company pays them upon the successful conclusion of the contract.
An insurance broker can also help you file a claim with the provider. The broker we recommend has been offering services to expats for more than a decade.
You can use this form to contact the insurance brokers we recommend.
