Originally published April 4, 2026. Updated July 12, 2026. The reform described below has since been passed into law. We have added the notes about each change under the relevant section.
Germany’s public health insurance system (GKV) is heading toward a financial crisis. To prevent its collapse, the German government has appointed an expert commission.
This commission is called the FinanzKommission Gesundheit. It delivered its first report on March 30, 2026.
The findings are stark: the GKV is projected to face a deficit of €15.3 billion in 2027, rising to over €40 billion by 2030. The main culprit is spending growing far faster than income.
The commission has released 66 proposals to fix the failing public health system.
UPDATE (July 2026):
- The cabinet approved the draft law on April 29, 2026.
- The Bundestag passed it on July 10, 2026 as the GKV-Beitragssatzstabilisierungsgesetz, 318 votes to 284, with 4 abstentions.
- The Bundesrat approved it the same afternoon without referring it to the mediation committee.
So the law is final.
During the parliamentary process, the projected 2027 funding gap grew from €15.3 billion to close to €18.8 billion, forcing the coalition to find roughly €3 billion in extra savings before the final vote.
Most measures take effect January 1, 2027; the family co-insurance change is delayed to January 1, 2028. Several individual measures ended up substantially different from what the commission proposed.
Why does Germany require a public health insurance reform?
The average additional contribution rate (Zusatzbeitrag) is 2.9% as of 2026. If nothing changes, the commission projects the additional contribution will reach 4.7% by 2030.
Additional contribution rate of different public health insurance in Germany ->
If you earn above €6,000 gross per month, the health insurance contribution increases by €720 per year for you alone.
You can check our report on the future of public health insurance here ->
Here are the main proposals that you should be aware of.
#1 No more free health insurance for your partner
Currently, a non-working spouse is covered under the employed spouse’s GKV policy at no extra cost.
The commission proposes restricting this. Free co-insurance would only remain available if you have no income and are either caring for children under six or looking after a dependent relative requiring care.
Everyone else would pay €240 per month for GKV membership. Around 1.77 million people, mostly women would be affected.
Project savings: €3.5 billion in 2027.
We have covered the reasoning and consequences of abolishing free co-insurance here ->
UPDATE (July 2026):
- There is no flat €240 monthly fee. Instead, the law adds an income-based surcharge (Beitragszuschlag) of 2.5% of the working partner’s income (new § 242b SGB V). This is paid entirely by the working partner.
- The age threshold for the child-related exemption raised from under 7 to under 12.
- Free co-insurance stays for parents of children with disabilities, for retirees, and caretakers.
- The implementation is pushed back to January 1, 2028.
#2 Higher out-of-pocket costs at the pharmacy
If you take prescription medication, your current co-payment (Zuzahlung) is between €5 and €10 per medication. The reform proposes raising it to €7.50 to €15.
If you currently buy ten prescription medications a year, your annual out-of-pocket cost would rise from €100 to €150.
The existing hardship cap has not changed. This means you won’t pay any co-payment once you’ve spent 2% of your gross income (or 1% for chronically ill patients).
The commission also proposes linking the co-payment to wage growth. This means the co-payment will rise every year as wages rise.
Projected savings: €1.9 billion by 2027.
UPDATE (July 2026):
- Co-payments will no longer rise automatically every year in line with wage growth (Grundlohnrate).
#3 Reduced dental prosthetics reimbursement
The proposal is to reduce the GKV reimbursement for Dental prosthetics (Zahnersatz) from 600€ to 520€.
Projected savings: €600 million for 2027.
UPDATE (July 2026):
- The reimbursement for dental prosthetics is cut by 10%.
- The hardship rule is untouched
#4 Reduced sick pay
When you are sick, your employer pays your complete wages up to six weeks. Afterward, your health insurance pays you sick pay.
Sick pay is 70% of your gross salary or 90% of your net income (whichever is lower). The proposal is to reduce the sick pay by 5%. This means 65% of your gross salary or 85% of your net income.
How to apply for sick pay in Germany ->
Example: Suppose your gross monthly salary is €4,000 and you get a net salary of €2,500. In this case, your sick pay would drop from €2,250 to €2,125 gross per month. This is €125 less.
Additionally, the reform proposes a partial sick pay model. This is similar to the Swedish system.
According to the partial sick pay model, you can be certified as 25%, 50%, or fully unfit for work. Based on this, you’ll receive a corresponding fraction of sick pay.
NOTE: Suppose you are a high earner with high fixed costs, such as mortgage payments. You should consider getting a daily sickness allowance insurance (Krankentagegeldversicherung) to bridge the gap.
Projected savings: €1.3 billion for 2027, plus €73 million for partial sick pay.
UPDATE (July 2026):
- The sick pay cut is dropped from the law. Sick pay stays unchanged.
- The projected €1.3 billion saving from this cut won’t happen.
- The partial sick pay become law, but with a different structure. Doctors can certify three levels of partial incapacity: 25%, 50%, or 75% -> rather than “25%, 50%, or fully.”
#5 More tax on tobacco, alcohol, and sugary drinks
The commission proposes raising taxes outside the GKV system to generate new revenue flowing into public health.
- The WHO recommends that 75% of cigarette prices should be taxed. Germany is currently at 68%. The proposal increases the cost of a pack of cigarettes by €0.50 each year. This means a €9 cigarettes pack will cost €11.50 by 2031.
- Spirits cost will rise by 10%. Beer and wine are not affected.
- A new sugar tax on soft drinks would be introduced, based on the sugar content.
Projected revenues: €1.2 billion (tobacco), €570 million (alcohol), €100 million (sugar) by 2027.
UPDATE (July 2026):
- None of these three tax increases made it into the GKV reform law itself. The government split them off into separate legislation. The Finance Ministry published a separate draft law to raise tobacco and alcohol tax on June 29, 2026. Its revenue is not earmarked for the GKV.
- An earlier tobacco tax increase already took effect in 2026 to fund, tax-free “relief bonus” (Entlastungsprämie) of up to €1,000 that employers can pay staff, not to close the health insurance funding gap.
- A sugar tax on sweetened soft drinks is still planned as its own law. But it would not start before January 1, 2028. It is projected to raise about €100 million in its first year.
#6 No more homeopathy, skin cancer screening, and general check-ups
- The proposal ends GKV coverage for homeopathic treatments. Currently, some insurers voluntarily cover homeopathy. This will no longer be possible.
No skin cancer screening (Hautkrebsscreening) for all adults over 35. Germany is currently the only country in the world to offer whole-body skin cancer screening as a standard benefit for healthy people. The proposal is to limit it to high-risk groups only.- No laboratory tests during the general health check-up from age 35.
Projected savings: €200 million by 2027.
UPDATE (July 2026):
- The homeopathy change passed as planned
- Introduced/added -> Cannabis flowers (Cannabis-Blüten) are no longer covered. Only standardized cannabis extracts and a small number of approved cannabis-based medications remain reimbursable.
- Skin cancer screening was not cut. Instead, the Federal Joint Committee will review the current screening rules and consider switching to a risk-based model. Until that review concludes, the current screening is available to everyone.
#7 Mandatory second opinions for certain surgeries
For tonsil, hip, and knee operations, you must get a second medical opinion. The goal is to reduce unnecessary surgeries.
Orthodontic treatments (Kieferorthopädie) would also be subject to closer scrutiny.
Projected savings: €200 million by 2027.
UPDATE (July 2026):
- This passed and was expanded. Instead of the G-BA naming just one procedure per year requiring a mandatory second opinion, the final law requires it to name two procedures per year from 2028 onward.
- The rollout is staggered
- Hip replacement and spinal surgery from 2028
- Gallbladder and uterus removal from 2029
- Tonsil removal and shoulder arthroscopy from 2030.
- GKV-funded orthodontic treatment may only be carried out by qualified orthodontic specialists.
#8 Shifting the GKV cost burden of Bürgergeld recipients to the federal budget
The new reform proposes that the federal government reimburse the health insurance costs of people receiving basic income support (Bürgergeld, now Grundsicherung).
What has changed in the basic income support ->
Currently, public health insurance subsidizes these costs. This costs the public health system up to €12 billion per year. Shifting this cost fully to the federal budget would be the single largest measure in the entire package.
UPDATE (July 2026):
- The full €12 billion shift did not make it into the law.
- The federal government’s extra contribution will be about €750 million in 2027 and €1 billion in 2028. It’ll reach €2.75 billion a year from 2031 onward.
- At the same time, the federal government is cutting its regular annual subsidy to the health fund (Bundeszuschuss) by €2 billion starting 2027. Federal government also delayed the repayment of €5.6 billion in loans it took from the GKV in 2023, 2025, and 2026.
- Ultimately, the federal budget ends up contributing far less to closing the GKV’s deficit than the commission recommended. This has become the most criticized part of the law, including from health insurers, opposition parties, and several state governments.
What happens next
UPDATE (July 2026)
The second FinanzKommission Gesundheit report is expected by the end of 2026. It will cover medium- and long-term structural reforms.
Subscribe to our newsletter to stay updated about the latest reforms ->
References
- Bundesgesundheitsministerium — Ergebnisse der FinanzKommission Gesundheit (30.03.2026)
- ZDFheute — Krankenversicherung: 66 Vorschläge für Milliarden-Einsparungen
- Deutsches Ärzteblatt — Lob und Kritik an Sparliste der Finanzkommission Gesundheit
- Bundesgesundheitsministerium — Finanzentwicklung der GKV 2025
- Bundesgesundheitsministerium — GKV-Beitragssatzstabilisierungsgesetz, Verfahrensstand und FAQ
- Bundesregierung — Kabinett beschließt Reform der Gesetzlichen Krankenversicherung (10.07.2026)
- Deutscher Bundestag — Bundestag verabschiedet GKV-Finanzreform (10.07.2026)
