A new report by the RWI Leibniz Institute for Economic Research has revealed a sharp decline in the financial health of hospitals across Germany. The Hospital Rating Report 2025, released on Thursday, shows that more than half of all hospitals are now making losses, a troubling trend that signals growing instability in the country’s healthcare system.
According to initial estimates from the report, 56% of German hospitals are expected to post an annual loss in 2024. This marks a steep increase from 43% in 2023 and just 22% in 2020. Even more alarming is the fact that many hospitals are on the brink of insolvency, with half of them only able to cover operating costs for two weeks or less.
These findings point to a healthcare system under severe financial pressure, with little room to absorb unexpected shocks.
The average risk of insolvency has risen to 1.8 percent in 2023. 16 percent of hospitals found themselves in the red zone with an increased risk of insolvency, 21 percent were in the yellow zone, and 63 percent were in the green zone.
While there was a 9% increase in hospital investment by federal states in 2023, totaling nearly €3.9 billion, this uptick in funding is still insufficient. Experts warn that current investments fall short of maintaining and modernizing healthcare infrastructure.
Performance ratings in the report show that private and non-profit hospitals consistently outperform public hospitals, both in terms of financial health and operational efficiency. Only in economically weaker districts do public hospitals come close to matching their non-profit counterparts.
Medium-sized hospitals (with 500 to 900 beds), hospital chains, and highly specialized facilities also demonstrated stronger financial indicators, suggesting that scale and specialization contribute to improved economic outcomes.
RWI health economist Boris Augurzky described the situation as “more tense than ever before.” He emphasized that while the government’s coalition agreement offers some solutions, bolder and more comprehensive action is necessary. “If we want to secure sustainable healthcare financing without overburdening citizens and businesses,” he said, “the federal government must step up its reform efforts.”
About the Report
The Hospital Rating Report 2025 is based on a sample of 442 annual financial statements from 2023 and a special analysis of 124 audited statements from 2024, covering a total of 888 hospitals. It offers one of the most detailed snapshots yet of the financial challenges facing Germany’s healthcare sector.
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