Cost Surge Forces German Government to Tap Reserves, Hike Drug Co-Payments in Health Insurance Fix
Published on 07/05/2026 at 21:06 | Redaktion boerse-global.de
Health insurance costs in Germany are galloping ahead of revenues, and the federal government is scrambling to keep contributions from rising. In the first quarter of 2026 alone, spending by statutory health insurers grew twice as fast as income – a trend the head of the GKV-Spitzenverband, Oliver Blatt, calls alarming. Hospital spending jumped 9 percent, physician practices 7 percent, and pharmaceuticals 6.5 percent, while revenues managed only a 4 percent increase. For 2027, the umbrella organisation projects a funding gap of 18.8 billion euros.
To close that hole temporarily, the cabinet of Finance Minister Klingbeil has proposed a 1.4?billion?euro relief package for next year. The main elements: an additional 750 million euros in federal subsidies for Bürgergeld (basic income) recipients, and a scaling back of a planned cut to the regular federal grant. Instead of slashing two billion euros from the subsidy, the government will now trim only 1.35 billion. That still leaves the health budget shrinking sharply – from 22 billion euros in 2026 to roughly 14 billion in 2027.
Health Minister Warken is coupling the short?term fix with structural reforms that shift more costs to patients and drugmakers. Starting in January 2027, co?payments for prescription drugs will rise by 50 percent: a medicine that today costs between 5 and 10 euros will cost between 7.50 and 15 euros. To offset that, an earlier planned automatic increase in co?payments has been scrapped. The pharmaceutical industry faces a steeper levy: the mandatory manufacturer discount climbs from 7 percent to 15.5 percent.
Contribution rates are meant to stay stable, with some sources citing a combined rate of 17.5 percent that would hold through 2028. For married partners, the family?insurance contribution will fall from 3.5 percent to 2.5 percent from 2028 onward, though parents with children aged 11 or younger will still have to pay more. Subsidies for dental prosthetics will drop by ten percentage points.
Blatt warned that the 1.4?billion?euro package could be watered down by lobbying in the Bundestag. Without consistent reforms, he said, policyholders would face massive premium increases down the road. The GKV?Spitzenverband is also pushing for a stronger tax?funded offset for non?insurance benefits that the system currently carries – costs it estimates at 22 billion euros.
The health?insurance rescue is folded into the broader 2027 federal budget, which envisions total spending of 555.4 billion euros and net borrowing of 118.7 billion. To finance the plan, the government will tap reserves worth between 6.8 and 7 billion euros and draw money from the Climate and Transformation Fund. New taxes on plastics, cryptocurrencies, tobacco, and alcohol are meant to bring in additional revenue. Defense spending is set to climb to nearly 150 billion euros, while the government is cutting parental and housing allowances by triple?digit millions. A sugar tax has been floated for 2028.
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