Carola Reimann

Lauterbach’s reforms “Flickschusterei” — Are health insurance companies threatened with bankruptcy?

Carola Reimann, head of the AOK federal association, warns of a “historic crisis” in the health insurance system. If Germany falls into a recession, there is even a threat of bankruptcy for a large health insurance company. She describes the planned reforms by Federal Minister of Health Karl Lauterbach as “hectic patchwork”.

How precarious is the current situation of the statutory health insurance companies? According to Federal Health Minister Karl Lauterbach (SPD), there will be a funding gap of 17 billion euros in the cash register system by 2023, and the additional contribution is expected to increase by 0.3 percentage points. But an interview with AOK boss Carola Reimann in the “Handelsblatt” now makes you sit up and take notice. Accordingly, the cash registers could face an even greater crisis — to the point that a large provider even slips into insolvency.

Reform plans “neither sustainable nor fair”

According to Reimann, himself a member of the SPD, the threat of price increases in the healthcare system has not yet reached most citizens. But that will change if the additional contribution is actually increased by three percentage points at the turn of the year 2022/23. Then every insured person has less net than gross at the end of the month. “In times of rapidly increasing energy prices and high inflation, this is not good news,” says the graduate biotechnologist.

She sees the cause of the impending financial deficit in the previous government’s expensive health care reforms, which she believes cost a lot of money but have no noticeable benefit for the insured. Sustainable financial and structural reforms, however, have been neglected for years. The reforms planned by the Federal Minister of Health would hardly be of any use here either. “What Minister Lauterbach presented is neither sustainable nor fair. Instead, he’s doing hectic patchwork, which doesn’t offer any planning security beyond 2023,” she says.

Reimann criticizes that 12 billion euros of the financial gap would be compensated for by the statutory insured alone through higher additional contributions. So they bear the brunt of the reforms. In addition, Lauterbach’s plans envisage reducing the cash reserve, which is also formed from contributions from the insured – 2.4 billion euros are to be withdrawn here. In addition, the federal government is granting a loan of one billion euros, which is to be repaid later. “That’s completely disproportionate, and I think it’s a real fall from grace,” said Reimann.

From 2023 at the latest, the health insurance companies’ financing problem will worsen, since the reserves will then be exhausted and the loan will have to be repaid, criticizes the official. But the structural gap continues to widen, with expenditure exceeding income by at least one percent. If the economy continues to weaken due to high energy prices and inflation, the deficit will increase even more — and the contributions will have to increase even more than planned anyway.

Reimann’s conclusion: “We have a fragile situation. The minister must understand that the coffers are empty”. There is a lack of money for extra expenses, such as for the hospitals and to combat the corona pandemic. There is also no money for many well-intentioned intentions in the coalition agreement: for example, that more nursing staff will be hired and pediatric and adolescent medicine and obstetrics will be removed from the flat-rate system. Another project are health kiosks: greatly simplified, low-threshold contact points for socially disadvantaged people, where information about prevention and health issues is provided. All of these projects have not yet been financed, and an additional 10 billion euros are missing, according to the AOK boss.

Reserves siphoned off – is there a risk of bankruptcy for a large health insurance company?

Reimann warns that the deficit of the health insurance companies could even continue to rise massively if — as in the early 2000s — the economy weakens. At that time, services in the health insurance catalog had to be reduced. In the course of the 2004 Statutory Health Insurance Modernization Act, it was enforced, among other things, that travel costs for outpatient treatment and glasses must be paid for by patients themselves. Does such a scenario threaten to repeat itself? Indirectly, Reimann is now addressing the possibility that a large cash register could also slide into insolvency because the cash reserves have been used up.

Reimann says that cuts in benefits are irresponsible because they affect the weakest in society. Instead, efficiency reserves in the healthcare system would have to be raised. “Hospitals are the largest block of expenditure. And a round of freezes for all service providers and the reduction in tax levies on pharmaceuticals would save ten billion euros,” said the AOK boss. She calls for more comprehensive reforms in the checkout system – with a “clear perspective for the coming years”. Another step: the federal government must contribute appropriately to the costs for HartzIV recipients.

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