Demographic transformation is taking to absurd lengths the risk equalisation between young and old incorporated into Germany’s statutory health insurance system. Despite increasing average expenditure on benefits, the solidarity principle is being upheld for a cross-section of the insured in any given period. In the long term, however, each succeeding cohort is having to bear a heavier burden. A similar situation applies to the risk equalisation between the productive and the less productive insured. To ensure that inter- and intragenerational solidarity is maintained as well, it is essential that the pay-as-you-go system is combined with an appropriate form of capital funding.
The level of statutory pensions for future generations is set to decline systematically. If future retirees are to maintain their standard of living, they will therefore need to supplement their statutory benefits with private and occupational pensions – a ...
The principle behind Germany’s statutory health insurance (SHI) system, into which all employees up to a certain income threshold are obliged to pay a per¬centage of their earnings, is one of solidarity.