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The laws relating to Social Insurance in Germany. |
A long-term foreign posting in the Federal Republic of Germany involves many changes for an employee, not just of a personal nature, but also the inevitable changes in different areas of everyday life, such as Health Insurance.
Health care systems differ greatly from country to country. Consequently, the rules regarding the rights to social insurance are based on the laws of the particular country in which the person is employed, as an employee is normally part of the social welfare system of their host country.
Those who come to work in Germany are bound by the social legislation of the German Federal Republic. Those coming from EU states are covered under the General Regulations of EEC Council Regulations 1408/71& 574/72. However, these Articles do not supersede individual EU State laws, but merely act as a harmonising mechanism between the various social welfare systems within the EU.
There are of course exceptions to these regulations, which either exist due to particular agreements between individual states or because of specific legislation within the country where an individual is working.
In Germany, these exceptions relate only to employees who are posted to Germany to work from a country with which Germany has an existing legal agreement on rights to social insurance. Such employees are defined as those who are requested to work on behalf of their employer for a temporary, yet specific period, in Germany. This also includes those on business trips. The full rights of the employer to issue instructions to it’s employees are however fully guaranteed.
In the case of those who have not been sent by an employer to work or for those who originate from countries with which Germany does not have any legal agreement on Social Insurance ,then they are automatically bound by German social welfare legislation.
Social Insurance Rights in Germany.
Each employee earning a salary to a maximum of €3,862.50 per month (under 2004 figures) is obliged to join the German Statutory Health Insurance Scheme (GKV). They are however free to join a health insurance company of their choice. Should their income exceed the stated figure or should they be self-employed, they then have the right to choose between remaining with the State Insurance Scheme or to arrange their own private health insurance. The following is a brief outline of the various benefits available under the two different schemes.
Insurance cover under the State Health Insurance Scheme.
Should one, be they an employee or self-employed, opt to join the State Insurance Scheme, then they are bound by the legal regulations as laid out by the SGB V (Sozialgesetzbuch). Premiums are set according to an individual’s income level. The average premium rate of all Statutory Health Insurance schemes currently stands at 14.5% of an individual’s income, assuming that their income does not exceed € 3450. Of this 14.5% premium, both employer and employee contribute an equal 50% share. In the case of self-employed policy holders, they are liable for the full premium payment.
Benefits of Statutory Health Insurance Schemes.
For the most part the majority of health insurance schemes in Germany offer similar benefits. Any differences exist merely in the individual rules of the company, for example rules concerning a policyholders life-style. The range of cover which a health insurance company is obliged to provide is regulated by the State Health Insurance Scheme. Although the health companies normally cover treatment, the individual policyholder is directly liable for some charges. These include a €10 levy per quarter, various costs for dental treatment and for hospital care along with costs for the provision of Tablets, Medicines and Dressings. Furthermore, there are several other elements to insurance cover which patients find quite negative.
Under the current range of cover provided by insurance companies, costs for Dental treatment or the provision of Dentures is fully covered. Cover for treatment for dental implants is limited to the use of standard materials only. Insurance company contributions in this case range from 50-65% of total costs, but only if the procedure is deemed to be medically necessary. In the case of less common and highly expensive dental procedures, such as the insertion of gold fillings or expensive bridges, then patients have to bear the full cost of treatment. As of January 1st 2005, cover for dental treatment under the current scheme will no longer be available. Cover will only be guaranteed by taking out an additional insurance policy.
Hospital treatment is also included within the terms of the State Health Insurance Scheme. However, that does not mean that a patient has the freedom to seek treatment in a hospital of their choice. Cover for hospital treatment extends only to the provision of care in a public ward under a general doctor with responsibility for several other patients, in a hospital chosen from a specific list.
There are yet further limitations to the State Health Insurance Scheme. Cover does not extent to the provision or replacement of spectacle frames and cover for contact lenses is only afforded in the case of medical necessity. Treatment by a non-medical practitioner is not covered neither are the costs for any drugs or medicines which may be prescribed. Full costs must again be borne by the patient.
All members of a State Insurance Company are obliged to be referred by their General Practitioner to a Specialist or Consultant for further treatment, in order to be covered by the company. Several areas of outpatient treatment are not covered by insurance companies and under no circumstances shall cover extent to treatment sought outside Europe, that is in countries that do not have an existing agreement on health cover with Germany.
Those in employment have the right to choose between a State Insurance Scheme or to have themselves insured privately, assuming that they are not obliged to join a state scheme under the terms outlined earlier. Unlike the State Insurance Scheme, the range of cover and the premiums charged are dependant on the terms of the individual private insurance companies. In other words, there is not specific list of benefits under a private scheme as there is under the State Scheme. Under a private scheme, the policy holder is free to choose a level of cover based on the premiums that they are prepared to pay. All insurance companies are however obliged to provide a similar level of basic health insurance cover as laid out by the AVB.
In the case of inpatient, outpatient and dental care, the insured has the freedom to visit a doctor, dentist or hospital of their choice. They are not restricted to seeking treatment from a predetermined list of doctors or hospitals, as is the case under the state scheme. The level of cover, which one may require for any of these three areas of healthcare, is also at the discretion of the policyholder, according to their individual needs.
As an outpatient, not only does one have the right to choose their own doctor or specialist but also they are free to visit a non-medical practitioner. The costs of all prescribed medicines are also fully covered. There are no hidden negative elements to private health insurance cover. The insured is not liable for any extra charges except in the case of an extra administrative charge being levied by a particular insurance company. In the case of medical aids such as hearing aids, spectacles etc. one can choose from a specific catalogue of products. This catalogue has a far more extensive range of products to choose from than that under the State Insurance Scheme. Lets us take the example of lenses and frames for spectacles. State insurance schemes only cover the costs of basic lenses whereas a private scheme not only covers frames but also provides for up to €200 to cover the cost of reflective and tinted lenses. One can also avail of contact lenses.
In addition to this, outpatients are normally covered for vaccinations, psychotherapy, transportation costs to their nearest doctor or hospital and for home-care. The use of Masseurs, Physiotherapists and Speech Therapists as well as transportation costs to Germany from abroad are also fully covered.
Concerning dental treatment, the private insurance policy holder has the choice between having treatment on their teeth and having them replaced. Treatment costs are fully covered under the terms of their policy. The cover for dentures depends on the individual insurance company and the level of premium paid, with cover normally ranging 75% to a maximum of 90%. In this instance, the difference between the state scheme and private insurance cover not only relates to the level of cover provided but the type of treatment available. In the case of the state schemes, only basic treatment is covered, for example Amalgam fillings whereas private schemes normally cover more expensive materials such as gold, ceramic and plastic fillings.
Those policyholders requiring inpatient hospital care are free to attend a doctor and a hospital of their choice. Patients are free to attend any clinic in Germany based on their individual requirements and where they expect the highest level of treatment. As well as having free access to all services within a hospital, the Private policyholder is also covered for the extra costs of being treated in a private or semi-private room. As well as treatment costs, the extra accommodation costs such as en-suite facilities, a telephone connection and a radio and television set are also fully covered. Transport by ambulance or rescue helicopter is also in-cluded by private policy.
Benefits while abroad.
Insurance cover while abroad extends under the terms of Article 4 of the AVB to cover for an unlimited period in any European country and for a temporary period of treatment of one month in country outside Europe. In the case of the patient not being able to be moved due to their medical condition, cover is extended by up to a further two months. As a rule, the majority of private insurance companies extend their global cover for a further month. As well as cover for holiday and business travel, private policyholders are also free to seek the services of a specific doctor or hospital while abroad.
How we can be of service to you.
Should you be a foreign national faced with the task of becoming part of the German insurance market, then we are here to help you in any way possible. We will answer any queries that you may have regarding statutory or private health schemes with the utmost of clarity and professionalism. The quality of our service is the basis for our customer’s satisfaction. It is through our policy of dialogue with our clients along with our expertise in the field of insurance cover that we continuously endeavour to broaden our field of expertise and thereby advance the cause of our clientele.
Please feel free to call us or to send us an E-mail.
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