Germany’s public health insurance system faces a mounting crisis, with accusations of fraud against hospitals and a rapidly deteriorating financial situation threatening the stability of the entire framework. Anne-Kathrin Klemm, head of the Association of Public Health Insurance Funds (GKV), has publicly condemned hospitals for allegedly exploiting a budget system designed to alleviate staffing shortages and ensure adequate patient care.
The core of the controversy revolves around the “Pflegebudget” introduced in 2020 to provide hospitals with unrestricted funding for nursing staff. Klemm alleges that clinics are now misusing these funds, employing non-qualified personnel to perform tasks typically handled by nurses and inflating staffing numbers for billing purposes. “Clinics are putting nursing staff to work cleaning floors instead of tending to patients” she stated in an interview with “Frankfurter Allgemeine Zeitung”, adding, “I consider this fraud.
The GKV is demanding a complete abolishment of the Pflegebudget, arguing that the current system, coupled with escalating nursing salaries, is unsustainable and open to abuse. The situation is exacerbating a pre-existing problem: the increasingly precarious financial health of the GKV. Current contribution rates, already surpassing the 2.9 percent target set for 2026 by Health Minister Nina Warken (CDU), now average 17.7 percent. Klemm warns that further increases are inevitable unless the government intervenes decisively.
Warken’s proposed “relief package” of 1.8 billion euros, intended to bolster the system, has been dismissed as inadequate. Klemm called the proposals “peanuts” criticizing their insufficient scope to address the depth of the crisis. The reform commission, tasked with implementing meaningful changes by March, is under intense pressure to deliver substantial solutions.
Beyond immediate financial measures, Klemm advocates for broad systemic reforms, including a reduction in the VAT rate on medications to 7 percent and a federal assumption of the full healthcare contributions for recipients of state welfare (“Bürgergeld”), a cost estimated at 10 billion euros annually. She also flagged the instability within the care insurance sector, temporarily mitigated only by further federal loans-a short-term fix that ultimately escalates future debt.
Klemm issued a stark warning, labeling 2026 a potential “tipping point” beyond which substantial reform becomes impossible. She expressed concern that the far-right Alternative for Germany (AfD) will capitalize on the public’s dissatisfaction with the healthcare system in upcoming state elections, using the crisis for populist gain. She urged centrist parties to prioritize healthcare reform as a matter of urgency.
Rhetoric has extended to the broader structure of the healthcare landscape, with Klemm rejecting proposals to reduce the number of health insurance funds or introduce patient co-payments. Instead, she proposed controversial measures, including a tax on processed foods and a sugar tax, arguing they would have a rapid and positive impact. Furthermore, she suggested introducing a mandatory “Health” subject in schools to promote preventative care and address the current regulatory barriers limiting proactive health interventions. Public health insurers, she claims, are often legally restricted from proactively counselling patients, even with their consent, highlighting the irony of intervention occurring only after serious health issues have already developed. “We only become active when the child is already in the well” she lamented, criticizing data privacy regulations as hindering preventative measures.