Germany’s long-term care insurance could run out of money by year-end, GKV warns

Germany’s long-term care insurance could run short of money for care benefits as early as October, just as the governing coalition prepares a reform of the system. GKV chairman Oliver Blatt warned that the fund would lack an estimated €500 million by the end of the year.

“By October, revenues will no longer be sufficient to fully finance care benefits,” Blatt said. Spending has risen almost three times faster than income, according to the Association of Statutory Health Insurance Funds.

The insurance system recorded a deficit of €770 million in the first half of the year. GKV expects the full-year deficit to reach €1.2 billion, even after including a €3.2 billion federal loan. Without that loan, Blatt said, the “honest result” would be a deficit of €4.4 billion.

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By October, revenues will no longer be sufficient to fully finance care benefits.

GKV expects the funding pressure to deepen next year, when it forecasts an additional financing requirement of €10 billion. It attributes the rising costs mainly to the growing number of people needing care, expenses for short-term and replacement care, and higher subsidies for residents’ contributions to full-time institutional care.

The association is demanding immediate action. It wants the federal government to repay €5.2 billion in exceptional pandemic-related costs and assume the cost of pension contributions for family caregivers, which it says would save the insurance system about €5.3 billion each year. The coalition’s planned reform, a major project for Health Minister Carsten Linnemann, is expected to include spending restraints and higher revenue to avoid broad contribution increases next year.

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honest result