Millions in German Social Care System Lost to Fraud, Investigation Finds
A recent investigation by Süddeutscher Zeitung, NDR and WDR has revealed a staggering rise in the misuse of a German social care system, with billions of euros being spent on a program intended to help caregivers take a break, only to find that in many cases, the care never took place.
The program, known as “Verhinderungspflege” or “care prevention” is designed to provide caregivers with a financial break, up to €2,500 per year, when they need to take a temporary leave of absence and another caregiver steps in. However, an analysis of reports from several major health insurance companies has shown that this help is increasingly being misused.
In a particularly egregious case in Bayreuth, a care consultant is accused of fraudulently claiming €100,000 to €200,000 per year, with the money being funneled to criminal organizations. The consultant is often promoted as offering a “holiday allowance from the care insurance” a phrase that has become a red flag for investigators.
Frank Warnhoff, a spokesperson for the Berlin State Criminal Office, said that in many cases, the scheme involves a kickback system, where the caregiver receives a small portion of the funds and the rest is kept by the criminal organization.
The German Association of Statutory Health Insurance Funds has downplayed the issue, attributing the problem to organized crime rather than individual malfeasance. Thomas Gritscher, the Berlin State Prosecutor, concurred, stating that the lack of oversight in the program creates an ideal environment for fraud.
The program has seen a remarkable boom in recent years, with the health insurance companies spending €2.1 billion in 2022, €2.6 billion in 2023 and a staggering €3.1 billion in the previous year, a 20% annual increase.
A report by the “Bund-Länder-Projektgruppe Abrechnungsbetrug im Gesundheitswesen” (Federal-State Project Group on Healthcare Fraud), published in March, highlighted the “weaknesses and flaws in the implementation of care prevention” and the lack of oversight, which has created a high potential for fraud.
The previous government had decided to increase the allowance from €2,500 to €3,500, effective July 1 of this year. Investigators are concerned that this increase will only encourage more fraudulent claims. Frank Warnhoff of the Berlin State Criminal Office warned, “The increase will, of course, also increase the incentive for criminal organizations to submit more fraudulent applications.”
The German Ministry of Health, on the other hand, has defended the increase, stating that it aims to combat fraud by providing care recipients with a clear overview of the payments made to them. However, Thomas Gritscher, the Berlin State Prosecutor, remains skeptical, saying that this solution will not work in cases where the care recipient is involved in the fraud, which, he believes, is the majority of cases.