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Jochen Pimpertz IW-Trends No. 3 2. September 2025 Is a Spending Freeze Sufficient to Stabilise the Contribution Rate in Germany’s Statutory Health Insurance? A Counterfactual Simulation

For almost a quarter of a century, Germany’s statutory health insurance expenditure has risen by an annual average of 1 percentage point more than revenue from its members’ contributions. This holds regardless of whether calculations are based on aggregates or per member or insured person (members’ families are co-insured).

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Is a Spending Freeze Sufficient to Stabilise the Contribution Rate in Germany’s Statutory Health Insurance? A Counterfactual Simulation
Jochen Pimpertz IW-Trends No. 3 2. September 2025

Is a Spending Freeze Sufficient to Stabilise the Contribution Rate in Germany’s Statutory Health Insurance? A Counterfactual Simulation

Jochen Pimpertz German Economic Institute (IW) German Economic Institute (IW)

For almost a quarter of a century, Germany’s statutory health insurance expenditure has risen by an annual average of 1 percentage point more than revenue from its members’ contributions. This holds regardless of whether calculations are based on aggregates or per member or insured person (members’ families are co-insured).

If this trend continues, further increases in contribution rates will be unavoidable. A change of health policy to ensure that spending is based on revenues is therefore urgently needed. One of the strategies currently being called for is a spending moratorium which would limit future increases in statutory health insurance expenditure to the growth in revenue from members’ compulsory contributions. That this will not suffice, however, is shown by the fact that the statutory health insurance membership will already have aged significantly by the end of the current legislature in 2029. A counterfactual simulation shows that while the rising proportion of pensioners with statutory insurance will not shrink the total amount of wages and salaries subject to compulsory contributions in that period, the growing number of insured in the higher age groups, on which more is spent, will lead to a latent increase in expenditure by 2028. If the contribution rate is to be stabilised during the current parliament, this impact on outgoings must be neutralised, to achieve which, expenditure per insured person increases must be kept 0.4 percentage points below the annual rise in contribution revenue.

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Is a Spending Freeze Sufficient to Stabilise the Contribution Rate in Germany’s Statutory Health Insurance? A Counterfactual Simulation
Jochen Pimpertz IW-Trends No. 3 2. September 2025

Is a Spending Freeze Sufficient to Stabilise the Contribution Rate in Germany’s Statutory Health Insurance? A Counterfactual Simulation

Jochen Pimpertz German Economic Institute (IW) German Economic Institute (IW)

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Development and influencing factors
Jochen Pimpertz / Lena Holtmeyer IW-Report No. 26 10. June 2025

Sickness rate in Germany: Development and influencing factors

Sickness rates in Germany have risen continuously since the mid-2000s and experienced an extraordinary jump in 2022.

Jochen Pimpertz / Lena Holtmeyer IW

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Sandra Parthie Event 5. June 2025

Presentation of the results of the IW study: Recognition of foreign professional qualifications from a company perspective

The German Economic Institute (IW) would like to invite you to the presentation of the results of the IW study: "Recognition of foreign professional qualifications from a company perspective" commissioned by the Federal Ministry for Economic Affairs and ...

Sandra Parthie IW

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