Germany's €22 Billion Care Crisis Sparks Controversial Cost-Shifting Reforms

Germany’s long-term care insurance system is heading for a €22 billion shortfall within two years if no action is taken. Health Minister Nina Warken is now preparing an austerity package to tackle the crisis, with plans to unveil reforms by mid-May. The proposed changes could significantly raise costs for care home residents and alter support for family caregivers. Under the current system, subsidies for residential care increase the longer someone stays in a facility. At present, residents pay around €3,200 per month out of pocket. But Warken’s plan would delay these subsidy increases and cap maximum coverage at 70% after four and a half years. Heinz Rothgang, a health economist, estimates this would add an extra €161 to monthly bills on average. Over the same period, residents could end up paying nearly €20,000 more in total.

Andreas Storm, head of health insurer DAK, has urged Warken to rethink the reforms. He also expects the minister to propose cutting pension entitlements for family caregivers by half. The changes aim to stabilise the system’s finances but would shift more of the financial burden onto residents and their families.

The reforms, if approved, would reduce state support for long-term care while increasing personal contributions. Residents in care homes would face higher monthly costs, with the total extra expense reaching nearly €20,000 over four and a half years. Warken’s austerity package is set to be finalised and presented in the coming weeks.