Health: Long-term care insurance: financial situation “more serious than ever”

Nursing care insurance will have fallen into the red in 2024 and is warning of greater financial difficulties despite recently increased contributions. “The situation is more serious than ever before,” said Doris Pfeiffer, head of the umbrella association of statutory health insurance companies, which also represents the nursing care funds, to the German Press Agency. The financing problem was not solved with the increase in contributions at the beginning of the year, but was merely postponed. At best, this will be enough to offset the increases in spending this year. “But that will no longer be enough for 2026.”

Pfeiffer said the situation is already getting worse. In February, individual nursing care funds could need liquidity support from a compensation fund for the first time. “Nobody has to worry about that now, because this procedure ensures that all nursing care funds will remain solvent this year.” But she added: “If the new federal government does not act very quickly after the election and take measures to ensure financial stability, nursing care insurance will face an existential crisis next year.”

Effect of the renewed contribution increase

The deficit in 2024 is expected to be 1.55 billion euros, according to data from the umbrella association. A final result should be available in mid-February. For this year, a small minus of 300 million euros is currently expected and thus a “roughly balanced result”. The background to this is a further increase in the contribution by 0.2 percentage points on January 1, 2025, after it was last increased in the summer of 2023.

This should now bring in additional annual income of 3.7 billion euros. On the other hand, the costs are also high. Last year, service expenditure increased by around eleven percent, explained Pfeiffer. “For this year we also expect an increase of well over eleven percent. This means that long-term care insurance will spend over 70 billion euros for the first time.”

Several reasons for higher costs in the billions

One reason for the increase is that the number of people receiving benefits is increasing “very dynamically”. At the beginning of the year, all payments for those in need of care at home and in nursing homes were increased by 4.5 percent, as determined by a reform of the traffic light coalition in 2023. Costs: 1.8 billion euros, which, according to the Ministry of Health, is now more available to those in need of care. The nursing care insurance funds are also paying more and more to mitigate rising personal contributions for those in need of care. Because nursing care insurance – unlike health insurance – only covers part of the costs.

Pfeiffer said there are numerous ideas on how care can be made future-proof. “It is important that the parties present their concepts during the election campaign so that people can get an idea of ​​who has which answer to this existential question.” To ensure that long-term care insurance returns to calm waters after years of uncertainty and emerging instability, the new federal government should strive for the broadest possible social consensus for reform.

Health Minister Karl Lauterbach (SPD) had actually aimed for a major financial reform, but this no longer came about after the traffic light coalition broke up. Pfeiffer said: “We never tire of demanding that the federal government fulfill its obligations.” Money to finance Corona measures would have to be paid back to the nursing care insurance and pension contributions for caring relatives would have to be paid permanently.

Care is already an election issue. The SPD wants to limit the personal contributions for pure care in the home to 1,000 euros per month – in the summer, according to health insurance data, the nationwide average in the first year in the home was a good 1,400 euros just for pure care. In addition, payments for accommodation and meals are also due. In the program, the Union mentions, among other things, tax resources and “affordable supplementary care insurance”. In addition to contributions, the FDP is aiming for “a funded component”. The Greens want non-insurance services to be “financed more appropriately by the state”.