National reform with a European dimension.

Hardly any issue has shaped the socio-political debate in Germany this month as strongly as the recommendations of the Health Financing Commission (“Finanzkommission Gesundheit”) on stabilizing the statutory health insurance system (GKV). On 30 March, the independent commission presented its first report containing 66 proposals aimed at securing the financing of the GKV from 2027 onwards in the long term and limiting any further rise in contribution rates.

The pressure to act is considerable: Germany now spends around €540 billion annually on health, while the GKV is already facing a financing gap of around €15 billion next year. Without structural reforms, this gap could grow to around €40 billion by 2030. Among other measures, the independent commission identifies savings potential in the pharmaceutical sector of around €7 billion per year.

European dimension

The debate is therefore not purely national – even if the recommendations of the Financing Commission are tailored to the complex German healthcare system. Developments in Germany are being closely monitored in Brussels and other EU Member States, as the financial sustainability of social security systems is also a key issue at European level. Germany has one of the most efficient, but at the same time one of the most expensive healthcare systems in Europe. The aim is now to bring revenues and expenditures back into balance and unlock efficiency potential without reducing the quality of care – a “revenue-oriented expenditure policy” that also plays a central role at EU level.

From a European perspective, the following proposals of the Financing Commission are particularly noteworthy.

Prevention: tax policy measures

A key focus of the report is prevention. The direct medical treatment costs of obesity, type 2 diabetes, cardiovascular diseases and cancer each amount to double-digit billions within the German healthcare system. The Financing Commission therefore recommends three tax policy measures intended both to create steering effects and generate additional revenues for the GKV: 1) an increase in tobacco tax, 2) higher taxation of alcohol, and 3) a tiered tax on sugar-sweetened soft drinks. According to the Commission’s calculations, these measures could generate around €1.9 billion in 2027 and around €5.5 billion by 2030.

These approaches are also reflected at EU level, particularly in the European cardiovascular plan (“Safe Hearts Plan”). The revision of the EU Tobacco Tax Directive was already presented in July 2025 and is currently under discussion in the Council of the European Union. While a reform of the Alcohol Tax Directive is currently not on the agenda, corresponding political demands continue to be raised in the context of the prevention debate. In addition, the Safe Hearts Plan also addresses nutrition policy. Although the Commission has so far refrained from proposing direct taxes on fat, salt or highly processed foods, it has announced that, based on a study on highly processed foods, it will examine suitable instruments – including possible financial measures.

Pharmaceuticals: Orphan Drug Privilege

The pharmaceutical sector is also at the center of the recommendations. The Financing Commission advocates abolishing the so-called Orphan Drug privilege. To date, medicines for rare diseases in Germany benefit from special rules in the benefit assessment process: up to a legally defined turnover threshold, they are automatically granted a non-quantifiable additional benefit upon market authorization, without having to provide empirical evidence to the same extent. The Financing Commission recommends ending this preferential treatment. The associated savings potential can only be estimated approximately, as it depends on future authorizations, price negotiations and the actual additional benefit of new therapies. As guidance, the report cites savings of up to €30 million in 2027 and up to €45 million in subsequent years.

The underlying objective is to prevent the GKV from permanently paying higher prices for medicines without proven additional benefit. This is a demand that the DSV also regularly raises at EU level, particularly in the context of the pharmaceutical reform, but also in ongoing legislative procedures such as the Critical Medicines Act and the Biotech Act.

What follows from recommendations with an EU dimension

The proposals of the Financing Commission did not remain without consequences. Shortly after the publication of the report, Health Minister Nina Warken presented a draft bill for a GKV Contribution Rate Stabilization Act - “Referentenentwurf für ein GKV-Beitragssatzstabilisierungsgesetz” - on 16 April. This was followed by the Federal Government’s cabinet draft on 29 April. Both drafts take up recommendations of the Commission, though not all of them. The proposed tax measures concerning tobacco and alcohol were included in neither the ministerial draft nor the cabinet draft. Newly added in the cabinet draft, however, was the plan to introduce a levy on sugar-sweetened beverages from 2028 through a separate legislative procedure. This falls within the remit of Finance Minister Lars Klingbeil. The government’s position on the Orphan Drug privilege also remains unchanged: it does not follow the recommendation of the Financing Commission and refrains from abolishing the special status of orphan drugs within the benefit assessment framework.

The Federal Government’s draft bill will now enter the parliamentary procedure. The aim is for the German Bundestag to adopt it before the summer recess. The law will then be discussed in the German Bundesrat. The position paper by the GKV-Spitzenverband on the ministerial draft can be found here. The further legislative process is also being closely followed in Brussels.