Berlin’s Care Reform Sparks Fierce Backlash as Families Face Steeper Costs and Pension Cuts
Berlin, June 17 – Germany’s long-term care insurance fund is grappling with a significant financial crisis, reporting a deficit of approximately €667 million in the first quarter of 2026, even after receiving an €800 million federal bridging loan. Projections for the full year estimate a shortfall ranging from €4.2 billion (official estimate) to €7 billion, according to Steffen Bilger, parliamentary secretary for the CDU/CSU bloc. By 2027, an additional €10 billion may be required to stabilize the fund.
Controversial Reform Proposal Ignites Political Firestorm
In an effort to address this growing deficit, Federal Health Minister Nina Warken (CDU) has introduced a draft bill, the Care Reorganisation Act (PNOG), which proposes substantial cuts and cost-shifting measures. However, this plan has triggered a widespread political backlash, drawing strong opposition from social associations, unions, and even members of the governing coalition.
Scrapping Income Thresholds: A Major Point of Contention
The most contentious measure within the proposed reform is the elimination of the €100,000 annual income ceiling for children of care-dependent parents. Historically, this threshold shielded approximately 90 percent of adult children from having to contribute to their parents’ care costs, which average €3,245 per month. The new rules would significantly increase the number of family members obligated to bear these expenses.
Pension Cuts for Unpaid Caregivers Raise Poverty Concerns
Alongside the removal of the income threshold, the draft bill also proposes a reduction in pension insurance contributions for unpaid caregivers to 70 percent of their current level. Charities like Caritas and CSU politicians have voiced serious concerns that this measure could push caregiving mothers, in particular, into old-age poverty.
Collective Bargaining Rights Under Threat
A third critical point of contention is the planned suspension of the requirement for care facilities to pay collectively bargained wages. Organizations such as Diakonie Württemberg and AWO Bremen argue that this will lead to a decline in wages for care workers and a subsequent deterioration in the quality of care provided. In response to these proposed changes, approximately 180 vehicles are expected to participate in a protest in Stuttgart on June 18.
Widespread Opposition from Across the Political Spectrum
Opposition to the reform is not limited to social organizations and unions; it extends across the political spectrum. CSU health expert Emmi Zeulner has rejected both the income-limit removal and the pension cuts. She advocates for a risk-pooling mechanism that would include civil servants and the privately insured. Her party colleague, Katrin Staffler, the federal care commissioner, has also called for a fairer distribution of the financial burden.
The SPD has also distanced itself from the reform. Health politician Christos Pantazis described the €100,000 threshold as a significant social-policy achievement. Yasmin Fahimi, chairwoman of the DGB (German Trade Union Confederation), has criticized the government for presenting a disjointed reform that prioritizes budget consolidation over genuine improvements to the care system.
Economists Propose Alternative Solutions
Health economist David Matusiewicz suggests an alternative approach, emphasizing the need to reduce bureaucracy, accelerate digitalization, and invest in preventative measures. The current contribution rate for long-term care insurance stands at 3.6 percent of gross income, increasing to 4.2 percent for individuals without children. The government aims to maintain this stability, with the draft envisioning even higher levies on childless individuals and the abolition of free spousal co-insurance.
The proposed Care Reorganisation Act continues to face strong resistance, highlighting the deep divisions and concerns surrounding the future of long-term care in Germany.
Source: boerse-global.de
