Bundestag passes controversial healthcare reform
Germany's parliament has approved a controversial healthcare reform designed to curb soaring public health insurance costs, despite strong opposition from pharmaceutical companies and industry leaders.
The reform is a key part of Chancellor Friedrich Merz's broader economic strategy to stabilize Germany's statutory health insurance system, which covers most of the country's population. Rising healthcare costs have increased payroll contributions for both employers and employees, putting additional pressure on businesses and reducing workers' take-home pay. The government says the new measures will help keep future cost increases in line with overall economic growth.
Health Minister Nina Warken defended the legislation, saying it lays the foundation for more stable public healthcare finances after years of increasing insurance contributions. According to the government, the reform avoids blanket spending cuts while introducing targeted measures aimed at reducing financial pressure on the healthcare system.
The legislation includes higher mandatory rebates for pharmaceutical companies, stricter limits on hospital spending increases, and changes to how several healthcare services are funded. It also raises the statutory manufacturer discount to 15.5%, increases rebates on patented vaccines, and introduces a vaccine price freeze from 2027 to 2030. Some of the government's original proposals were softened before the final parliamentary vote after political negotiations.
The reform has drawn fierce criticism from major pharmaceutical companies, including Pfizer, AstraZeneca, Eli Lilly and Merck KGaA. Industry representatives argue the measures will discourage investment, weaken Germany's position as a global pharmaceutical and research hub, reduce clinical research, and potentially limit patients' access to innovative medicines. Despite these objections, the government insists the changes are necessary to secure the long-term financial sustainability of Germany's healthcare system.