Cost Surge in Healthcare: German Health Insurers Warn of Increasing Premium Surcharges

Millions of people with statutory health insurance in Germany must prepare for higher premium surcharges. The National Association of Statutory Health Insurance Funds (GKV-Spitzenverband) warns that the average additional premium for 2025 will likely exceed previous forecasts.

Originally, the average surcharge was projected at 2.5 percent for 2025. However, according to Doris Pfeiffer, chairwoman of the association, a rate of at least 2.6 percent now seems more realistic – even mid-year.

The primary cost drivers are rising expenses for hospital treatments and pharmaceuticals. In 2024, total spending by statutory health insurers exceeded €311 billion, with average per capita healthcare costs rising by 7.8 percent.

Pfeiffer explains: “The number of treatments is barely increasing, but illnesses are becoming more severe.” Contributing factors include higher wages in nursing, material costs, and inflation.

The pharmaceutical sector is also placing a heavy burden on finances. Since 2012, drug spending has nearly doubled, now reaching €56 billion. A key reason is the reduced manufacturer discount introduced in 2024. At the same time, costly specialized therapies – often exceeding €100,000 annually – are on the rise.

By May 2025, eight insurers had already raised their premium surcharges. For someone earning a gross salary of €3,500 per month, an increase from 2.5% to 2.6% equals about €3.50 more per month – shared equally between employee and employer.

In 2024, statutory health insurers recorded a combined deficit of around €9.9 billion, and financial reserves continue to shrink. The association is now calling for long-term political reforms.

“Without structural changes, there is no sustainable path to stabilizing contributions.”