Long-term care insurance: This is how much parents save with their offspring

Verdict
Long-term care insurance: This is how much parents will save in the future with their offspring

Statutory long-term care insurance will become more expensive on July 1 – at least for small families and people without children. Families with several children, on the other hand, should be relieved. The draft law was passed by the Bundestag at the end of May, it is based on a judgment of the Federal Constitutional Court of May 2022. At that time, the court decided that parents of several children should be relieved, after all, they would have particularly high costs and usually lost wages because of their offspring Parent has to cut back on work.

It is not the first time that the Federal Constitutional Court favors parents: as early as 2001, it decided that families should be better off because they make a “generative contribution to the functionality of a pay-as-you-go social security system”.

Tiered according to the number of children

So who pays how much now? The starting point is always the general contribution rate. It applies to parents with one child for life, no matter how old their offspring is now. And that same overall rate is now up 0.35 percentage points to 3.4 percent. The long-term care insurance is borne equally by the employer and the employee, so everyone has to pay 1.7 percent. For a person with one child and a gross salary of 4000 euros, the new contribution rate will be 68 euros from July – instead of the previous 61 euros.

Insured persons without children will have to pay a surcharge of 0.6 percentage points in addition to the general contribution rate. This only applies to the employee share, so that after the changeover they have to pay 2.3 percent into the statutory long-term care insurance – 1.7 percentage points plus 0.6 percentage points. So far, you have had to pay 1.7 percent to the care insurance fund.

Families with several children will in future receive a deduction of 0.25 percentage points for each additional child. Unlike the general contribution, however, this does not apply for life, but only as long as the children are under 25 years old. And here, too, the deduction only applies to the employee share, employers continue to pay a constant 1.7 percent for their employees. Parents of two children therefore pay 1.45 percent for their long-term care insurance (1.7 percent – ​​0.25 percent), with three children it is therefore 1.2 percent employee share. The scale of the deductions ends with five children: Anyone who has five or more offspring only has to pay a uniform 0.7 percent employee share.

The birth certificate must go to the employer

Now the reform does not come without bureaucracy. Employees must prove their so-called parental status to the bodies paying the contributions (i.e. the employer). It is not enough that the manager has already seen the offspring at a summer party. As early as 2017, the central association of statutory health and long-term care insurance funds issued recommendations on how this proof is to be provided: Parental status can be proven, for example, by means of the birth, paternity or adoption certificate, but also a tax certificate from the residents’ registration office or the child benefit notice of the Federal Employment Agency are suitable for this.

If you have not yet submitted such proof to your employer, this does not have to happen immediately. By March 31, 2025 at the latest, a digital process is to be developed that can be used to prove the existence of your children. This is intended to “relieve both the members and the contribution-paying bodies and the nursing care funds from the administrative burden,” according to the Federal Ministry of Health.

In the meantime and even a little longer (June 30, 2025), a transitional period will apply during which a simplified procedure is foreseen. During this time, it is entirely sufficient for insured persons to inform their employer or the long-term care insurance funds that they have children under the age of 25 when requested to do so. However, they can do without concrete evidence during this period, according to the Federal Ministry of Health. After the transition period at the latest, the contribution-paying offices and the long-term care insurance funds would actually have to check the specified children.

If employers or the long-term care insurance fund do not take the deductions into account as of July 1st, for example because they are waiting for the introduction of the digital procedure, they must reimburse the deductions retrospectively by July 30th, 2025 at the latest. Interest is also charged on this money.

This article first appeared on “Capital”

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