Sep 8, 2021

Financial implications of healthcare in Germany

hospital and healthcare in Germany

The novel coronavirus has affected every aspect of our daily lives and business all around the world with healthcare services facing the hardest hit of the virus. New healthcare policies were implemented in every country including the healthcare system in Germany.

In order to provide help for German hospitals, the third Covid-19 Population Protection Act was adopted by the parliament in November. Daily payments for beds that are kept in the hospital to treat Covid cases were introduced. The hospitals that possessed intensive care units and postponed elective treatments to provide urgent care to Covid patients were made eligible to claim compensations payment. The eligibility to cater to the Covid-19 patients was determined by the state and the hospitals which lied on those criteria were eligible to receive compensation. The compensations were paid to the hospitals that treated a lower number of patients in 2020 as compared to 2019. The rehabilitation facilities were once again allowed to be used as recovery facilities to accommodate the discharged Covid-19 patients with mild symptoms.

Around EUR 12.7 billion was provided to the hospitals in Germany between March 2020 and April 2021 to accommodate the Covid patients. Additionally, the physicians and therapists received payments of around EUR 207 million in Germany while other facilities such as ambulatory acquired a total of EUR 2.4 billion since the start of the pandemic to 2021.

A total deficit of around EUR 1.7 billion was reported in the first to third quarters of 2020 by Germany’s 105 statutory health insurance funds. However, the income of the SHI funds was augmented by 4%. Given the losses, the Federal Ministry of Health agreed to provide additional subsidies in 2021. To compensate for the availability of hospital beds, coronavirus wards, and ICUs, rehabilitation facilities, expansion of intensive care beds, EUR 10.5 billion was paid out of the liquidity reserve of the German Health Fund.

German federal government reimbursed almost EUR 8.8 billion the Health Fund for the first and third quarters as they recorded a deficit of EUR 5.1 billion until the end of 2020.

The highest deficit of the decade was witnessed as the SHI deficits increased from one billion EUR to 2.5 billion EUR in 2020. The Covid-19 played a significant role in causing this deficit. Most of it was witnessed in the second half of the year 2020 as the expensive surgeries and rehabilitation clinics remained empty. In the third and fourth quarter of the year, there was a deficit of EUR 3 billion and EUR 900 million respectively.

As the world is still fighting Covid-19 in 2021, the German government took on EUR 96.2 billion debt and loosened the strict policies on public debt. An extra subsidy of EUR 5 billion was earmarked for the SHI funds deficits in 2021. In addition, the Federal Ministry of Health also received EUR 6 billion from the budget to fight Covid-19. Many parts of that money will provide free rapid tests, EUR 1.5 billion will be there to reimburse GPs and EUR 1 billion was earmarked to support hospitals and other medical centers.

*All the figures mentioned above are estimated and are reported by covid19healthsystems*

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