Residents in Germany could soon pay more towards long-term care insurance, particularly if they don’t have children, as the government seeks to close a growing funding gap.
People without children in Germany may see higher deductions from their pay checks, if proposed reforms to the country’s long-term care insurance system go forward as planned.
Germany’s Federal Health Minister, Nina Warken of the conservative Christian Democrats (CDU), is preparing a reform of the long-term care insurance system that would increase the financial burden on the childless.
The proposal, first reported by RedaktionsNetzwerk Deutschland (RND), suggests raising the surcharge for childless individuals by 0.1 percentage points to 0.7 percent.
If implemented, this would bring the total contribution rate for childless insured individuals aged 23 and above to 4.3 percent of their gross income (a 3.6 percent base rate plus a 0.7 percent childless surcharge).
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By contrast, contribution rates for parents would remain unchanged, continuing at 3.6 percent for one child, 3.35 percent for two children, and 3.1 percent for three children.
The base contribution is generally shared equally between the employee and employer, but the childless surcharge would be paid by the employee alone.
The reforms are not yet final. According to reports, the proposals are currently being discussed within the federal government’s early coordination phase, and full details have not been officially published.
Warken had previously indicated she would present her plans publicly in mid-May. Proposals are apparently still being finalised within the coalition government.
€22 billion projected deficit
The changes are being considered in response to a projected deficit of more than €22 billion in Germany’s long-term care insurance system over the next two years – significantly higher than previously expected.
Alongside higher contributions for childless individuals, the health minister is also reportedly exploring cuts to subsidies for nursing home costs, stricter eligibility criteria for benefits, and increased premiums for high earners.
READ ALSO: Higher co-pays, fewer services – The cuts coming for Germany’s public health insurance
Why contributions differ – and why they may rise
Germany’s long-term care insurance system (Pflegeversicherung) is designed to help cover the cost of care for elderly or dependent individuals.
It is funded through payroll contributions shared between employees and employers, meaning most residents will see the payments deducted automatically from their income.
Broadly speaking, the system operates on a pay-as-you-go basis – where today’s workforce funds the care of current recipients, rather than building up individual savings.
This makes it particularly vulnerable to demographic change: as the population ages and fewer workers support more retirees, costs can rise sharply.
Employees in Germany can typically see how much they are paying by checking monthly payslips, where the care insurance contributions are listed alongside health, pension and unemployment insurance.
The exact rate depends largely on whether you have children and how many.
The principle of charging higher rates to childless individuals stems from rulings by Germany’s Federal Constitutional Court.
In 2001, judges ruled that parents make a double contribution to the system by raising future contributors – and that this should therefore be reflected in lower premiums.
Later rulings and reforms reinforced this idea, introducing a tiered system where larger families pay progressively less.
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