The solution to ongoing premium increases in private health insurance

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Probably most members of a private health insurance company will be annoyed about the annual premium increases, which are particularly serious with increasing age. As a solution, private health insurance companies usually offer a succinct explanation: in order to maintain the previous contribution, one could even do without some of the benefits previously covered. In other words, less power for the same contribution.

Those who go through this for a few years should soon be on the same level as the statutory health insurance companies, which however have completely different rates. However, privately insured persons cannot switch to a statutory health insurance fund from the age of 55. And now? The Network Career guest authors, attorney Dr. Johannes Fiala and Dipl.-Math. Peter A. Schramm, expert for actuarial mathematics, have taken up the topic and report on concrete possibilities to avoid ongoing premium increases.

Around 5% of those insured with private health insurance (UN) are in social tariffs (standard tariff, emergency tariff, basic tariff), with an upward trend. In the emergency tariff, private health insurance policyholders with considerable premium arrears are “steered out” of the emergency tariff by means of a special reminder procedure, § 193 VII VVG. Far more insured persons often reduce their insurance cover not only in old age by changing tariffs, higher deductibles and the exclusion of e.g. optional hospital services in order to achieve a significant reduction in premiums.

 

Emergency tariff instead of basic tariff since 01.08.2013

Because of the statutory insurance obligation, the insurer (VR) cannot terminate the private health insurance, remains liable to pay benefits despite non-payment of contributions by the UN, and will therefore reduce its obligation to pay benefits by switching to the emergency tariff, which will result in a lower premium of up to less than EUR 100.

However, the UN may also bring forward a tariff change (possibly to the standard tariff at health insurance level) if it prefers to do so rather than discontinue payments. Or he can switch to a tariff with a high deductible of up to EUR 5,000 per year or emaciated benefits. In the basic tariff with almost health insurance benefits, those in need of social assistance pay a reduced contribution, which may even be covered by the state.

 

Emergency tariff ensures benefits in acute cases – even without premium payment

In the emergency tariff, he receives almost only benefits in all acute cases – including pain-relieving dental treatment including the necessary fillings, but no new tooth if one has been extracted. It’s not inhumane. The authors themselves have some clients who are very happy to be on the emergency tariff as long as they don’t want a more expensive wish treatment, and always owe about 200 EUR, so that they don’t get back to their powerful but expensive original tariff before the time when they wish it themselves. You save up to 1,000 EUR each month and pay some small amounts yourself. Insolvent people are the fewest of these, but they want to live better. Even without paying contributions, they continue to meet the statutory insurance obligation in the emergency tariff.

 

Access to the emergency tariff only by non-payment of the UN

However, the UN does not qualify for the emergency tariff that is therefore desired, but only by non-payment of contributions. He should then pay these back soon, with the exception of contribution debts of always around EUR 200, which always arise in the emergency tariff, if he wants to avoid recovery measures by the BoD. If you have simply always owed one or two monthly fees in the emergency tariff, it is up to you when you want to return to your full tariff – for as long as you need to have your teeth thoroughly cleaned. In addition, compulsory long-term care insurance must be paid, failure to pay for which can be punished by a fine.

 

The emergency tariff as an opportunity for premium optimizers

In the emergency tariff, small parts of the ageing provision of the original tariff are used to support contributions. In fact, however, its ageing provision continues to grow, mostly from interest. Calculations have even shown that the ageing provision often continues to grow more strongly than before the change to the emergency tariff. The reason for this is that in the case of older people the ageing provision for the increasingly high benefits of the tariff would have to be released to a greater extent already for the period of “presence” in the tariff than small parts of it would be diverted to support the emergency tariff.

 

Additional protection makes standard and emergency tariffs more attractive

A new offer from the “Carta Mensch” support fund now makes the emergency tariff an even more interesting alternative – the “N1 Emergency Aid Health Plan”. This is because the latter reimburses between 10 % and 30 % of the invoice amounts in addition to the emergency tariff, so that doctors and dentists are not limited to the narrow fee rates of the emergency tariff. Remedies are even reimbursed at 80%, as they are excluded from the emergency tariff for adults.

The provident fund shall make advance payments to the private health insurance company if the latter fails to provide a service of the emergency tariff on time. In other cases, it can also provide medically necessary services.

In disputes about the obligation of the private health insurance to provide benefits, an initial consultation is provided by cooperating lawyers or insurance consultants.

In addition not only to the emergency and standard tariff, but also to slimmed-down private health insurance tariffs and statutory health insurance (GKV), another “Gesundheitsplan Stationär S1” offers optional services in single or double rooms. Supplementary insurance at the standard rate is not permitted in the private health insurance itself – but a support fund is not such a private health insurance.

 

Savings in contributions through relief fund (UK)

A higher deductible in private health insurance often offers considerable savings in premiums. The provident fund starts here with other health plans in which these deductibles are absorbed, whereby the contribution savings in private health insurance are usually significantly higher than the contribution for the health plan in question. This makes tariff changes in private health insurance even more interesting.

For those insured by the statutory health insurance scheme, there is a range of services including preventive care, alternative practitioners, visual aids and reimbursement of co-payments.

 

Guaranteed admission with restrictions

The “Carta Mensch support fund” promises guaranteed admission without any health checks. However, there is a waiting period for treatments in progress at the start of participation and those that were started in the first 3 months, as there is no reimbursement for these until they are completed. Some health plans also provide for limited benefit scales in the early years. And for illnesses that existed at the start of participation or were treated in the last 5 years before that, as well as their consequences, a benefit will only be paid after three years for treatments then required. However, the Support Fund may, on request, include these benefits, if necessary under special conditions.

The provident fund does not have a contractual right of termination. Contributions can be adjusted, but only evenly in each health plan – in addition, increases are provided for, in some cases due to age.

The provident fund does not grant a formal legal right to certain benefits, because it cannot do so, because that would be insurance. However, the provident fund wants to ensure equal treatment of all members and observe equity aspects in its concrete benefit decisions.

 

PKV on the retreat?

Does the “Carta Mensch support fund” intend to withdraw the private health insurance into a basic care niche? Since it is not allowed to offer a legal claim, it cannot itself fulfil the insurance obligation, as courts have already found with other health support funds. However, a private health insurance tariff for outpatient (excluding dental) services and multi-bed rooms in hospitals is sufficient. The scale of fees can also be restricted, as can the reimbursement framework for therapeutic products, among other things. Private health insurance tariffs without psychotherapy also occur, so that this should also be permissible. And finally, the whole thing can be provided with an annual deductible of 5,000 euros. At the end of the day, this legally compliant basic private health insurance provision will cost perhaps 75 euros per month in premiums, including ageing provisions – anything beyond that could then be covered by the provident fund.

Today, there are no such cheap private health insurance offers yet – but now the emergency tariff does, and this even with age-independent premiums without any ageing provision.

Ultimately, the private health insurance scheme must admit everyone who is attributable to it at least in the basic tariff, from where he is then converted to the emergency tariff by simply stopping payment of contributions, in order to fulfil his insurance obligation there in future, with higher-value optional benefits via a health support fund.

 

Support funds with tradition before Ludwig II of Bavaria

Not only since the 19th century has the institution of the relief fund (UK) existed as an institution for the fulfilment of social obligations, for example through Bavarian associations. As early as the 12th century, customary law developed into so-called mining regulations with a cooperative character, including the regulations on the financing of miners’ associations as the UK, which was later also adopted by the guilds. Even after Bismarck’s introduction of statutory health insurance, this was still standard for many occupational groups not insured there. Initially, privileged were miners and, for example, miners – later also workers of the Bavarian castle building industry. Individual occupational groups (e.g. priests, firefighters, police officers) have been using the health insurance system for more than a few decades to protect themselves – as an alternative to private and statutory health insurance. In recent years, SHI and private health insurance policyholders have been fleeing to the younger UK as an alternative to compulsory insurance.

 

Anyone who prefers a secure legal entitlement to SHI benefits can still switch from private to statutory health insurance at the age of more than 55 years, but usually not without a temporary change of status, second job, occupation or location – within or outside the EU. However, the employees of their own private or statutory health insurance companies are usually overwhelmed with such design issues.

 

by Dr. Johannes Fiala and Dipl.-Math. Peter A. Schramm

 

by courtesy of

www.network-karriere.com (published in issue 05/2017 page 28-29)

 

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About the author

Dr. Johannes Fiala Dr. Johannes Fiala

Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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