Government unveils fresh strategy

The German government has announced its intention to manage without higher contributions for health and nursing care insurances, following a meeting of the coalition committee on Wednesday, 3 September 2025. The decision comes amidst concerns about the financial stability of the nursing care insurance, with the deficit having reached 1.55 billion euros in 2024, according to the GKV.

Health Minister Nina Warken (CDU) had prepared for a scenario involving increased contributions at the beginning of July. However, the coalition expects reform proposals from Minister Warken regarding legal regulations on savings in the healthcare sector. The increase in contributions for 2025 will not plug the hole in the nursing care insurance, as stated by various sources.

The general contribution rate in the nursing care insurance is currently 3.6 percent. Dr. Doris Pfeiffer, chairwoman of the GKV association, stated that a higher contribution will at best balance the increase in costs for 2025 but will not be enough for 2026. Offsetting an increase in the contribution rate for the nursing care insurance by 0.1 percent would cost around two billion euros.

The coalition committee has agreed that it is not only the task of a finance minister, but the task of the entire government to plug the hole in the nursing care insurance. SPD faction leader Matthias Miersch expressed confidence that the coalition can achieve the goal of maintaining stable contributions without increasing them.

Several measures have been proposed to address the financial pressure on health and nursing care insurances. These include taking over pension contributions for caregiving relatives and pandemic-related expenses through tax funds, transferring investment and training costs to the federal states, involving private nursing insurance in financial equalization, and implementing annual adjustments of federal tax subsidies and benefit contributions.

Additionally, social associations and unions suggest raising the flat-rate care benefits for full inpatient care, removing the training cost levy from institutional nursing costs, increasing care allowances by at least 10%, establishing an "entlastungsbudget" (relief budget), and finding a fair financing mix of contributions and taxes to close the financing gap in social nursing care insurance, projected at about 14 billion euros.

The association of statutory health insurers (GKV) warned of a "dramatic financial situation" in the social nursing care insurance, and it is uncertain whether the funds in the nursing care insurances will last until the end of 2025. The coalition's commitment to maintaining stable contributions is seen as an important signal to insured persons, as stated by Jens Spahn, Union faction leader.

However, maintaining the current contribution rates in both health and nursing care insurances would require Finance Minister Lars Klingbeil's help with the state budget, as stabilizing the contribution rates would be associated with high costs. Solutions to the financial pressure on health and nursing care insurances may not be easy to find, but the Union and the SPD aim to tackle necessary reforms together to move Germany forward.