(de-news.net) – The German Federal Cabinet has approved an initial long-term care insurance reform focused on financial stabilization, including higher contributions for childless members while keeping the general rate at 3.6 percent in 2027. Broader structural changes will be left to an expert commission, while the package also expands prevention, home-care support and future benefit adjustments. The reform comes amid major financial pressures, with the care insurance deficit projected at 4.4 billion euros in 2026 and potentially 10 billion euros in 2027.
Germany’s Cabinet agreed Wednesday on a draft proposal to restructure the country’s long-term care insurance system, bringing months of difficult deliberations within the governing coalition to a preliminary conclusion. The legislation, introduced by Health Minister Carsten Linnemann (CDU), is designed primarily to stabilize the system’s finances while leaving more fundamental structural questions for a later stage. Those broader issues are to be taken up by an expert committee scheduled to begin work in October, which implies that the Cabinet’s proposal represents an initial financial and organizational response rather than a comprehensive overhaul of the care system.
Under the plan, the general contribution rate for long-term care insurance will remain unchanged at 3.6 percent beginning Jan. 1, 2027. At the same time, the surcharge paid by members without children will rise by 0.3 percentage point to 0.9 percent. The increase is intended to contribute to the system’s financial stabilization while keeping the general contribution rate unchanged. The proposal also scales back an earlier plan to raise the contribution assessment ceiling by 1,000 euros per month. Under the agreement now reached, the ceiling will increase by only 300 euros. In addition, assessments determining an individual’s need for care will place greater emphasis on whether rehabilitation could substantially reduce that need, linking eligibility more closely to the possibility of maintaining or restoring independence.
Deal balances financial savings with demands for broader changes
Linnemann has presented the legislation as a first step toward putting the long-term care system on a more stable financial footing. He has argued that the measures would prevent a projected deficit of 8 billion euros, help safeguard the provision of care and allow the general contribution rate to remain unchanged in 2027. At the same time, the Cabinet agreed that more fundamental questions about the future organization entailing structural changes of long-term care should be transferred to a commission. That body is expected to begin developing more comprehensive reform proposals in October, leaving the immediate legislation focused largely on financial stabilization while broader changes are considered separately.
The Cabinet agreement followed a final period of uncertainty in which the SPD had questioned whether the proposal could be adopted in its initial form. The dispute reflected different priorities within the governing coalition. Linnemann had placed greater emphasis on securing savings and stabilizing the system’s finances before undertaking more extensive changes. SPD parliamentary leader Mathias Miersch, by contrast, had called for an immediate structural overhaul and argued for limits on patients’ out-of-pocket costs. After the Cabinet decision, SPD General Secretary Tim Klüssendorf said the agreement could contribute to financial stability but should not yet be regarded as a completed reform. The SPD intends to continue pressing for effective limits on individual costs while also seeking a more equitable balance between statutory and private long-term care insurance.
Care reform adds support measures as insurance finances remain under strain
The agreement also sets out several changes to contributions and benefits over the longer term. Beginning in 2028, an additional payment of 0.52 percent will be introduced to cover spouses or domestic partners. At the same time, the existing arrangement under which long-term care insurance fully covers pension contributions for family members providing care will remain in place. From 2029, benefits under statutory long-term care insurance are to be adjusted annually according to the core inflation rate. The provisions therefore combine immediate financial measures with a framework for future adjustments to benefits as economic conditions change.
The draft also places greater emphasis on prevention and support for care provided at home. People aged 60 and older will become eligible for a preventive health check, while assessments of care needs will take greater account of an individual’s rehabilitation potential. Families caring for relatives at home are also to receive prevention-focused assistance intended to support care arrangements before needs become more severe. A digital ‘care cockpit’ is planned to bring relevant information together in one place, providing families with a more centralized source of data related to care. Core home-care benefits will increase as well. In addition, a social-area budget and a temporary support budget for acute care situations are intended to improve assistance and coordination when families face immediate or changing care needs.
Despite the Cabinet’s agreement, the financial pressures facing the long-term care insurance system remain substantial. The umbrella organization representing statutory health and long-term care insurers has warned that, without additional funding, the system could have faced insolvency as early as October. Its deficit is expected to reach 4.4 billion euros in 2026 and could increase to 10 billion euros in 2027. Those projections illustrate the financial constraints surrounding the Cabinet’s initial reform package and help explain why the coalition has focused first on measures intended to stabilize the system while postponing broader structural decisions to the expert commission.
