Key points
- Germany runs the Bismarck model: non-profit sickness funds, funded from payroll contributions shared by employers and employees.
- About 90% of the population is in statutory health insurance, and about 10% in private insurance (KFF).
- Care is delivered by private providers, regulated — patients have free choice of provider, with no referral needed for most specialists.
- Covered services carry small co-payments; there is no bill at the point of use for most care.
- Life expectancy at birth was 81.1 years in 2023, and health spending was 12.3% of GDP in 2024 (OECD Health at a Glance 2025).
Direct answer: Germany runs the Bismarck model: non-profit sickness funds, funded from payroll contributions shared by employers and employees, paying private providers who are regulated. About 90% of the population is in statutory health insurance and about 10% in private insurance. Covered services carry small co-payments, and there is no bill at the point of use for most care. Life expectancy at birth was 81.1 years in 2023, and health spending was 12.3% of GDP in 2024 (OECD Health at a Glance 2025).
At a glance
| Item | Detail |
|---|---|
| Model | Bismarck — sickness funds |
| Who pays | Non-profit sickness funds, from payroll contributions shared by employers and employees |
| Who delivers | Private providers, regulated; free choice of provider, no referral needed for most specialists |
| What is free at the point of use | Covered services with small co-payments; no bill at the point of use for most care |
| Life expectancy at birth | 81.1 years (2023, OECD Health at a Glance 2025) |
| Health spending | 12.3% of GDP (2024, OECD Health at a Glance 2025) |
| Source for the model and coverage | KFF Health Policy 101 — international comparison |
Figures are a snapshot checked 7 November 2026, not a live feed. No country is ranked as best.
How the system works
Germany’s statutory health insurance dates to 1883, the oldest system of its kind, introduced under Chancellor Bismarck — which is why the model carries his name. Workers and employers pay contributions, set as a share of wages, into a sickness fund. The funds are non-profit, self-governing bodies; they must accept all applicants and they compete on service rather than on who they cover. About 90% of the population is in statutory health insurance. About 10% — mainly higher earners, civil servants and the self-employed — hold private insurance instead, and many in the statutory system buy supplementary private cover on top.
The state does not run the hospitals or the practices. Care is delivered by private providers — office-based physicians, private non-profit hospitals, pharmacies — under contracts with the funds and under regulation. Patients have free choice of provider, including direct access to most specialists without a referral, and there is no gatekeeping GP in the way the United Kingdom has.
Who pays, and what people pay
Payroll contributions are shared between employer and employee, collected as a percentage of wages up to a ceiling. The contribution rate is set nationally, with funds able to add a small supplementary rate. The money is pooled and redistributed between funds according to the health risk of their members, so a fund with sicker members is not penalised for it. Co-payments apply to some services — prescriptions, hospital stays, some therapies — but they are small and capped: children are exempt, and adults pay no more than a set annual limit based on income.
What is free, and what is not
There is no bill at the point of use for most care: the fund pays the provider directly. What people do pay is the co-payment on some services, within the annual cap, and the cost of services outside the benefits package — some dental work, some optical care, and treatments the funds do not cover. Private insurance holders pay their own premiums and are billed directly by providers, then reimbursed.
How it compares
Germany spends 12.3% of GDP on health — the second-highest share in this set, above the OECD average of 9.3% — and its life expectancy of 81.1 years equals the OECD average (OECD Health at a Glance 2025). Its distinguishing feature is the combination of universal cover with provider choice and no gatekeeping: a regulated market of non-profit insurers and private providers, rather than a state-run service or a single payer. Compare countries side by side in the Health System Comparison tool, or read the other profiles in the country index.
Frequently asked questions
Do Germans pay to see a doctor?
Covered services carry small co-payments, but there is no bill at the point of use for most care. The sickness fund pays the provider directly, and co-payments are capped.
Can Germans choose their own doctor and hospital?
Yes. Patients have free choice of provider, including specialists, with no referral needed for most specialist care. Sickness funds contract with providers, but patients are not tied to one fund's doctors.
What is a sickness fund?
A non-profit insurer that collects payroll contributions and pays providers. Germany's statutory health insurance dates to 1883, the oldest system of its kind. Funds compete on service, not on who they cover — they must accept all applicants.