Care insurance may run out of funds by November, prompting federal loan request
The German long-term care insurance fund could exhaust its cash reserves this year, and the finance ministry is seeking an interest-free loan from the federal government.
According to a letter dated 1 October from the Federal Ministry of Finance, the statutory long-term care insurance fund is projected to run out of cash before the end of the year, with the balance potentially disappearing as early as November. The fund’s outlays are climbing faster than anticipated, mainly because the number of care-dependent individuals has risen sharply. The previously granted loan is now deemed inadequate, prompting the ministry to request an extra interest-free loan from the federal budget.
Health Minister Carsten Linnemann, speaking at a government briefing on 23 September, cautioned that despite the existing loan, a shortfall of several hundred million euros could persist, necessitating another fiscal intervention. The final size of the supplemental loan will depend on the fund’s spending in the coming weeks, and the planned care reform is considered too late to prevent the imminent deficit.
Why it matters
A funding gap in Germany's care insurance could force additional budget cuts or tax increases to support vulnerable seniors.
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