Federal Audit Office Warns of Rising Health Insurance Costs in Germany

The Federal Audit Office has raised alarm over a deepening financial crisis in Germany’s statutory health insurance system. In a letter to the Bundestag’s Budget Committee, the authority called for immediate cost-cutting measures. Without action, health insurance contributions could reach levels that may slow economic growth, according to the report obtained by AFP on Monday.

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“The financial situation of statutory health insurance (GKV) is deteriorating,” the document states. Last year saw the highest increase in expenditures in three decades. Currently, the gap between the income and spending of the funds is growing by six to eight billion euros annually. By 2029, the supplementary health insurance contribution could rise to 4.05 percent.

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The federal government, however, is delaying necessary measures, the auditors criticized. “The reserves of the health insurance funds have been depleted and no longer ensure sufficient contribution stability.” The report was initially covered by the news magazine Politico.

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The Audit Office highlighted political leniency as a key factor: “The expenditure increase is mainly due to the elimination of cost-limiting regulations.” Technological advances and demographic changes, including an aging population, are further widening the structural funding gap, as lower income is expected from retirees while costs continue to rise.

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The auditors called for spending cuts across all relevant areas of the system, especially where significant cost increases are occurring. Delays, they warned, lead to additional avoidable expenses, particularly regarding the ongoing hospital reform. The reform aims to improve efficiency, shift care toward outpatient services, and enhance quality, and these core goals must not be diluted.

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Greens budget expert Paula Piechotta urged the federal government to implement a cross-party reform. “This coalition lacks the strength and unity to push through a genuine reform,” she said. “A broad, jointly developed solution by all democratic parties is needed to ensure a sustainable system that remains effective beyond the next federal election.”

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