The financing of healthcare costs for recipients of the citizen’s allowance is causing a massive conflict between health insurance companies and the federal government. The Association of Statutory Health Insurance Funds (GKV) has argued for years that the federal government is responsible, but now it is suing. According to the health insurance companies’ calculations, there is a shortfall of around ten billion euros annually because the state does not adequately cover the citizen’s allowance. (zdf: 11.09.25)
Dispute over Citizen’s Allowance and Healthcare Costs
Health insurance funds are responsible for the medical care of Citizen’s Allowance recipients. The federal government pays a flat rate, which the statutory health insurance system considers insufficient. Only €108 per person is paid, while the actual healthcare costs average €311. Two-thirds of the costs are therefore borne by the contributors.
Susanne Wagenmann of the GKV criticized: “Year after year, the federal government owes the statutory health insurance funds around ten billion euros.” The health insurance funds view this practice as government relief at the expense of employees and companies.
Consequences for the insured and the economy
The unequal funding affects not only health insurance funds, but also the economy. Rising healthcare costs increase non-wage labor costs and reduce employees’ net income. The association sees this as a weakening of Germany as a business location.
Discussions with politicians have been ongoing for many years, but concrete results have failed to materialize. “For many years, we have been campaigning at all levels to end this unlawful underfunding. To no avail. Now we’ve had enough,” the umbrella organization emphasizes. This shifts the focus to the lawsuit against the federal government.
Lawsuit against the Federal Office for Social Security
The GKV has decided to sue the federal government. The goal is to “end the systemic underfunding of healthcare for legally insured citizens’ allowance recipients,” as ZDFheute reports. The jurisdiction lies with the North Rhine-Westphalia State Social Court in Essen.
The health insurance companies see the lawsuit as their last chance to assert their position. The goal is to ensure that the federal government finally fully covers the actual healthcare costs of recipients of the citizen’s allowance.
A Burden for Millions of Insured Members
According to the GKV (State Health Insurance Association), the underfunding affects all 75 million members of statutory insurance. If the federal government fails to close the gap, insured members will pay higher contributions. This increases pressure on health insurance funds, while simultaneously placing greater burdens on employees and companies.
The association also warns of rising labor costs, which will weaken the competitiveness of German companies in the long term. The lawsuit therefore marks a decisive step in the conflict over citizens’ income, healthcare costs, and government responsibility.