Medical treatments: What does health insurance pay for and what doesn't?

How health insurance works in Germany

The compulsory health insurance regulates that everyone in Germany must have a statutory or private health insurance. Thus, there are two different systems that coexist and each of the variants brings individual advantages as well as disadvantages. The fact is, however, that not everyone has the free choice, but up to a certain income limit, employees are required to have statutory health insurance. Accordingly, only those who earn more or are self-employed may join a private health insurance fund. Further exceptions apply to civil servants, temporary soldiers and judges. They are free to decide whether to remain in the statutory health insurance scheme voluntarily or to take out private insurance - but they must choose one of the two options.

Now, there are quite a number of people who do not belong to any of the above categories and who are therefore in danger of falling through the cracks, as often happened in the past. This is precisely why compulsory health insurance was introduced and, accordingly, such exceptions are now also strictly regulated: Trainees, interns, students, recipients of unemployment benefits, pensioners, artists, publicists, agricultural and forestry entrepreneurs, and persons without any other entitlement to benefits in the event of illness must also join the statutory health insurance scheme. However, those who are voluntarily or compulsorily insured in the statutory health insurance fund enjoy the freedom to choose which insurance carrier to select.

Benefits can vary considerably

The health insurance system in Germany is correspondingly complicated, which makes it difficult to make blanket statements when it comes to benefits, for example. These can, in fact, vary greatly depending on the health insurance provider, which also applies to the contributions. This is especially, but not only, the case between private and statutory providers. However, this does not necessarily mean that higher premiums also mean that more services are included in the insurance cover. It is therefore important to look at the policies in detail and compare them carefully. In particular, those people who have a choice between statutory or private health insurance can benefit greatly financially. But even between the statutory providers there are notable differences that must be taken into account when making a decision.

Many insurance companies therefore entice customers with additional benefits in order to stand out from the competition - or they offer the same benefits at lower prices. However, it is important to read the insurance contract in detail, because some traps can lurk in the fine print, especially in private health insurance (PKV). It is also important to know that the two types of insurance work in fundamentally different ways: The equivalence principle applies to private health insurance, while the so-called solidarity principle applies to statutory health insurance. Nevertheless, both PKV and GKV (statutory health insurance) are now legally regulated as to the minimum benefits they must cover. Only then do they finally offer sufficient protection, which is to be fulfilled by the health insurance obligation.

These achievements take over the legal health insurance

Because the statutory health insurance and the private health insurance function according to different principles, the just mentioned, legal requirements for the assumption of costs also differ. In private health insurance, the insured have more choices and in most cases also receive more benefits for higher premiums. In the case of statutory health insurance, on the other hand, the level of contributions is based on income, whereas all policyholders of the same provider are entitled to the same benefits. This applies at least to the mandatory benefits, which are often also referred to as standard benefits. Accordingly, every GKV member is entitled to the following

• medically necessary treatments
• including the associated diagnostics
• and rehabilitation.

This means that, if medically necessary, the statutory health insurance pays for the entire treatment, diagnostic measures, preventive care, follow-up care, medications, and remedies and aids. Furthermore, patients have a right to payment of sickness benefits. All this applies regardless of the contribution paid. The Social Code also defines that all these measures must be "sufficient, appropriate and economical". As a rule, anything that exceeds what is necessary is not paid for. However, as is well known, there are exceptions to every rule.

Exceptional case "IGeL": Individual health services

Anything that is not covered by statutory health insurance falls into the category of so-called individual health services, or IGeL for short. These can be medical, dental or even psychotherapeutic services for which there is no medical necessity, at least in legal terms. Accordingly, patients must pay for them out of their own pockets if they wish to make use of them. Statutorily insured patients in Germany spent an estimated one billion euros on these in 2018, for example for additional ultrasound examinations or new diagnostic procedures. Although IGeL are not considered medically necessary, they can still be useful depending on the individual case. More and more health insurers are therefore trying to attract customers by voluntarily paying some IGeL in full or in part.

For those insured in the SHI system, it can therefore be worthwhile to compare the service catalogs of different providers. Around five percent of the services provided by statutory health insurers are so-called statutory services, i.e. additional services for the prevention, early detection or treatment of illnesses. Sometimes the costs for the corresponding IGeL are covered in full, in other cases only partially. In each case, however, this means cost savings and better medical care for the insured. In addition, the IGeL are covered if there is a medical necessity in the individual case, for example because a family history of breast cancer increases the risk. In such high-risk cases or if there is a well-founded suspicion of illness, the GKV also covers the following IGeL:

• Intraocular pressure measurement
• PSA test
• Breast ultrasound
• Ultrasound of the ovaries

Furthermore, there are individual health services that are paid for depending on age, and for some years now, more and more IGeL have been included as standard in the service catalogs of the statutory health insurance funds. For example, acupuncture treatment for chronic back pain has been paid for since 2006, urine sugar measurement for pregnant women since 2012, and shock wave therapy for heel pain since 2018 - and the list of examples does not end there. The trend is for more and more services to be covered by statutory health insurance, but premiums could also continue to rise in the future.

Differences to private health insurance

Due to the equivalence principle, there are even greater differences in the benefit catalogs of private health insurance companies. In most cases, however, these are more generous than those of the GKV. These include check-ups and preventive examinations, as well as any medical treatment required. Private health insurers also cover many additional or new treatment methods that are (still) covered by statutory health insurers. However, patients with private health insurance must first make an advance payment, i.e. they pay the doctor out of their own pocket. Subsequently, the patient is billed directly by the health insurance company. This means that privately insured patients need an appropriate budget in order to pay even high bills themselves first - and that there is always a certain risk if the costs are not covered, not covered in full or only after a very long time by the insurance company, which can lead to disputes. Nevertheless, not all IGeL are covered by private health insurance either, so once again it is worth comparing different providers.

When the health insurance does not pay or only partially pays

Both private and statutory health insurance companies provide services that are not paid for or only partially paid for. They must always apply the principle of economic efficiency. For additional services such as cosmetic procedures, the income from the premiums is therefore simply not sufficient. However, it is not always easy to distinguish whether a medical necessity exists or not. Accordingly, health insurance companies do not pay or only partially pay in the following cases:

• Inpatient treatments

Although medically necessary hospital treatment is covered, the additional costs for guaranteed accommodation in single or double rooms are not. Also, although patients can insist on treatment by a chief physician during a hospital stay, this is not paid for by the health insurers. However, if the treatment happens to be provided by the head physician, these benefits are of course included. In the case of statutory health insurance, there is also an own contribution of ten euros per day for hospital stays. This is charged for a maximum of 28 days per year. Treatment in private or special clinics is not always covered by the statutory health insurance.

• Medicines, remedies and aids

Whether a deductible is to be paid and in what amount depends on the individual tariff for private health insurance. In principle, however, private insurance pays for more medications than statutory health insurance. The latter charges a co-payment of ten percent, which may be a minimum of five and a maximum of ten euros. This even applies to medications prescribed by a doctor. Most over-the-counter medications are also not reimbursed, and only small fixed subsidies, if any, apply to medical aids. In addition, they are only paid for in the simplest form, and a deductible of ten percent plus ten euros per prescription applies to remedies. Anything that is not covered by the benefits catalog, such as the cost of glasses, is only covered in exceptional cases, i.e. if it is medically necessary.

• Outpatient or inpatient cures

If certain conditions are met, statutory health insurance companies cover spa stays of three weeks in length and every four years. This can be both an inpatient and an outpatient cure. In these cases, the costs are also covered for meals and accommodation, although there is again a co-payment of ten euros per day. With private health insurance, on the other hand, cures are usually not included unless a corresponding tariff has been selected.

• Sick (daily) pay

If an illness makes you unable to work for more than six weeks, people with statutory health insurance are entitled to sick pay. This is intended to compensate for loss of earnings and is paid at a rate of up to 90 percent of net pay - for a maximum of 78 weeks. In some cases, the statutory health insurance also offers so-called children's sick pay. These benefits are usually not included in private policies, but can be taken out additionally. In this case, the insured have more flexibility to determine the amount of sick pay.

• Alternative treatments

More and more people are turning to alternative treatments, such as alternative practitioners, for acute ailments or as a preventive measure. In principle, these are not included in statutory health insurance, but some of these treatments may be included in the voluntary benefits catalog. With private health insurance, on the other hand, treatments outside of conventional medicine are in many cases included from the outset, or they can also be selected as an additional benefit.

• Dental and orthodontic services

Dental services are extremely limited in the SHI system and are reduced to what is medically necessary. This includes, for example, check-ups and prophylaxis. Dental prostheses are only covered in very few cases, and if they are, then in the simplest form. Private health insurance is usually more generous in this respect. Dental cleanings and high-quality dentures are usually included, but many plans only pay for these on a pro-rata basis. There are also differences in orthodontic treatment, which is covered in full or in part depending on the tariff. In the case of statutory health insurance, the costs are also usually covered on a pro rata basis or even in full.

• Benefits abroad

While private health insurances are often valid worldwide, these end at the European border in the case of statutory health insurances. Therefore, people with statutory health insurance need additional coverage for more distant or longer trips. Even within the EU, there may be restrictions on benefits abroad; for example, return transports are often not reimbursed. Depending on the tariff, these are fully covered in the PKV - it is therefore worth taking a look at the details.

• Death benefit

A death benefit is no longer paid by the statutory health insurance since 2004. This is also not included in most private health insurance plans.

Checking rates and taking out supplementary insurance

So there are notable differences between PKV and GKV when it comes to their benefits. However, neither of them offers complete coverage in all cases. In the case of private policies, it is therefore worth choosing suitable tariffs or supplementary insurances, which can often be taken out directly in combination. Those with statutory insurance can establish comprehensive financial coverage through private supplementary insurance, whether through death benefit insurance, supplementary dental insurance, alternative practitioner insurance, supplementary eyeglass insurance or supplementary hospital insurance - the selection is large and offers a suitable choice for every scenario. Which of these is worthwhile for whom, however, must be decided individually; after all, each of these policies also means additional costs.

Financing treatment costs out of pocket

It is therefore important to weigh up whether the additional costs for higher-performance tariffs in private health insurance or supplementary insurance for statutory health insurance are worthwhile. Alternatively, money can be set aside to pay for those treatments that are not covered by the health insurance out of one's own pocket if the worst comes to the worst. There are also other ways to finance these if necessary, depending on the individual situation. In any case, it is first worth asking the health insurance company to cover the costs. Especially if a doctor confirms the medical necessity, the chances are quite good that at least part of the costs will be covered.

If this is not the case, or if the deductible must be financed, a loan may also be the solution. This means maximum flexibility in terms of the loan amount, the amount of the monthly installments and other factors - as well as rapid payment if the loan is taken out online. A comparison is worthwhile, then good conditions are quite possible and even higher expenses such as those for a high-quality denture can be managed. They can then be paid off in installments, similar to the contributions that would be required for supplementary insurance. The advantage is that the insured only have to pay if they actually use the services and not, as with supplementary insurance or a more expensive tariff, irrespective of performance. Finally, in some individual cases there is the possibility of receiving financial support from special foundations:

• ADAC Foundation
• German Cancer Aid
• Ernst Jakob Henne Foundation
• Ernst Prost Foundation
• Franz Beckenbauer Foundation
• Index of Need
• Professor Herrmann Auer Foundation
• Stefan Morsch Foundation
• Antenne Bayern Foundation

Depending on the individual case, other foundations or fundraising campaigns may also be considered. Those who are seriously ill themselves and cannot pay the costs or, for example, need help with the treatment costs for their own child, should therefore research such possibilities and make use of them.

New boundaries of "medical necessity

In the meantime, however, there are also more and more precedents in which private or statutory health insurers have assumed costs even though these are not actually part of the catalog of benefits. This has created a gray area in which it is possible for costs to be covered, at least on a pro rata basis - and it is therefore worthwhile, as mentioned above, to at least inquire with the relevant health insurance company. Such gray areas today are, for example, breast reconstruction after breast cancer therapy, novel therapies in the development stage or participation in studies.

Summary

The idea that health insurance covers all costs for medical treatment is therefore a fallacy. This is true for private as well as for public health insurances. It is therefore important to pay attention to the benefits catalog when taking out the respective policy and to compare different providers. This is even worthwhile in the case of statutory health insurers, although they have less leeway. In addition, there are alternatives to cover high treatment costs if they are not or only partially covered by insurance - and the gray area is also growing. However, the insured could also pay for this in the future via higher premiums, which again applies equally to PKV and GKV.