BDA AGENDA 23/2025 | Topic of the Week | November 13, 2025

Short-term austerity measures are appropriate – but they are no substitute for genuine structural reforms

The austerity package recently adopted as part of the law on expanding powers and reducing bureaucracy, which aims to reduce bureaucracy in the care sector, takes important short-term steps: limiting administrative costs, suspending the most-favored-nation clause, and reducing the innovation fund. These measures are necessary to alleviate the acute pressure on additional contributions to statutory health insurance (GKV). However, they do not solve the structural problems. Without far-reaching reforms, the GKV will remain neither financially viable nor efficient in the long term.

Why short-term interventions are not enough

Full wage refinancing counteracts cost-cutting efforts: it creates false incentives, drives up costs, and removes any incentive for collective bargaining parties such as hospitals to act moderately. When wage increases are negotiated at the expense of third parties, the principle of wage determination is reduced to absurdity. Such a carte blanche jeopardizes contribution stability and places a burden on insured persons without any discernible benefit—clear evidence of the need for reform, as we state in our position paper. In addition, Germany spends 12.3% of its GDP on healthcare, the highest in Europe, without offering top-quality care. This shows how urgently efficiency potential needs to be leveraged.

What else needs to happen now

Until structural reforms take effect, further steps to stabilize contribution rates are essential

• Cost-covering contributions for citizens receiving social assistance from the federal government (approx. €10 billion annually).
• Dynamization of the federal subsidy for non-insurance benefits (+€8 billion annually).
• Closing the investment gap in hospitals by the federal states (approx. €4 billion annually).
• Financing the hospital transformation fund exclusively from tax revenues – not from contributions.
• Reducing VAT on medicines and medical aids to 7%.
• Dynamize co-payments: adjustment to price developments since 2004 (€7.50 / €15).
• Expenditure moratorium: price and fee increases only within the scope of revenues, no further expansion of benefits

These measures are not an end in themselves. They create time to implement urgently needed structural reforms: concentrating the hospital landscape on facilities that are needed, overcoming sector boundaries, expanding digitalization, and strengthening the personal responsibility of insured persons.

Conclusion
The statutory health insurance system faces a double challenge: short-term relief and long-term reform. Austerity measures alleviate the symptoms but do not cure the causes. Only comprehensive healthcare reform—as outlined in our position paper—can secure a lasting balance between income and expenditure and maintain the competitiveness of our location.

Detailed information can be found in our position paper “For an efficient and affordable statutory health insurance system” and in our statement “Short-term austerity measures are appropriate, but they are no substitute for structural reforms.”