Coalition negotiates final savings package for health insurers before Bundestag vote

Adjustments to co-insurance

Instead of the originally planned 3.5 percent, insured persons are to pay additional contributions of 2.5 percent of their income subject to contributions from 2028 for their previously co-insured free-of-charge spouses or life partners. As emerges from the preliminary overview, the Union and SPD agreed on changes to the draft launched by the cabinet – including on measures for insured persons and the pharmaceutical industry as well as on the federal contribution, according to information from the dpa news agency from a preliminary overview.

A compromise is also emerging on the federal subsidy. While the federal subsidy in 2027 will fall from the current 14.5 billion to 14.15 billion euros, the original draft bill had provided for only 12.75 billion euros. In 2027, 1.4 billion euros more will flow from the federal budget to statutory health insurance than provided for in the cabinet draft.

Federal subsidy and tax contribution

In addition, Finance Minister Lars Klingbeil (SPD) is providing an additional 750 million euros annually until 2030 for the healthcare of basic security recipients. As a result, the originally planned cut to the federal subsidy of 1.35 billion euros is smaller than the two billion euros initially discussed. The federal lump sums do not currently cover the health costs of basic security recipients, who are generally insured with the statutory funds.

In return, the statutory manufacturer discount on medications is to be more than doubled in 2027, from seven to 15.5 percent. Subsequently, according to the original draft, there was to be a dynamically adjustable price discount, which is now no longer planned. According to Der Spiegel, the dynamicized discount would have brought in more money in the long term, specifically one billion euros annually.

Manufacturer discount and pharmaceutical industry

Here the CDU minister has apparently responded to pressure from the pharmaceutical industry, which had threatened to relocate operations. As several media outlets reported, citing company circles, the pharmaceutical company Eli Lilly has reduced its investments in Germany, citing Warken's savings plans. The package contains expenditure brakes for medical practices, hospitals, pharmacies, and the pharmaceutical industry.

Tightening is also emerging regarding co-payments by insured persons. The current range of at least 5 euros and at most 10 euros is to be raised to 7.50 euros to 15 euros. While the personal contribution is to rise by 50 percent as planned, an originally envisaged automatic increase in line with basic wage development is to be dropped. This would likely eliminate annual adjustments to medication co-payments.

Higher co-payments for insured persons

The changes also affect inpatient treatments. Patients are to make higher co-payments for medications and hospital stays. The coalition is negotiating on several points ahead of the planned passage of the savings package to stabilize contribution rates. Warken had revised the savings target upward after a faster-than-expected rise in expenditures at the funds at the beginning of the year; the gap to be closed was put at 18.8 billion euros.

Andreas Storm, CEO of DAK-Gesundheit, assessed the corrections as a step in the right direction. «Es ist wichtig, dass zur Schließung der gestiegenen Finanzlücke jetzt nicht die Versicherten zusätzlich belastet werden», said he. Higher tax revenues are a first important contribution to a fairer distribution of burdens and increase the overall acceptance of the reform.

Reactions from funds and politicians

CDU General Secretary Carsten Linnemann welcomed the greater federal engagement: «Aber dass man jetzt den Einstieg macht mit einer Milliarde, finde ich richtig.» He also acknowledged that, in his view, more must come from the federal budget. From the perspective of the GKV-Spitzenverband, association chief Oliver Blatt warned that in the end, no additional gifts should be distributed to interest groups.

The statutory health insurers see movement in the right direction, but urge adherence to the savings target. According to this, the SPD and Union must still mobilize at least 2.5 billion euros more compared to the cabinet draft. According to the Frankfurter Allgemeine Zeitung, which first reported on the changes to the draft, the additional contribution for co-insured partners is now to be 2.5 instead of 3.5 percent of income subject to contributions.

Parliamentary procedure

The portal «The Pioneer» had also reported early on the planned changes to the free co-insurance of spouses. The Union and SPD are negotiating changes to the package with regard to insured persons, the pharmaceutical industry, and the federal subsidy. The Bundestag's Health Committee will decide on the changes on Wednesday.

Following the Bundestag, the Bundesrat must also approve. The chamber of the states will meet on Friday for its last session before the summer break; the law is also to go to the Bundesrat. In order for the package to complete the parliamentary process this week, a swift conclusion of deliberations is necessary.

Individual companies in the pharmaceutical industry had already announced consequences. According to its own statements, the pharmaceutical company Eli Lilly is reducing its investments in Germany, citing the savings plans of the Federal Health Minister. The coalition wants to stick to the goal of cushioning the rise in health insurance contributions in 2027 with the bundle of expenditure brakes, higher co-payments, and a larger federal subsidy.