German Health Insurance Faces Record Deficits and Risk of Insolvency

Rising costs and insufficient state contributions push public health insurers toward financial instability, prompting urgent calls for systemic reform.

• Germany's public health insurance system reported a deficit of over €6 billion in 2024, the second-largest shortfall in over two decades.
• Rising costs for hospitals, medications, and reduced pharmaceutical rebates are key drivers of the financial gap, as expenses outpace revenue growth.
• The average insurance contribution rate increased sharply in 2024, with further hikes anticipated in 2025 to prevent insolvencies among insurers.
• Leaders of major insurance providers warn that reserves are critically low, with some insurers at risk of insolvency if systemic issues are not addressed promptly.
• Experts and insurance executives call for reforms, including fairer state contributions, cost containment measures, and restructuring of inefficient healthcare spending.

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