Nursing care reform: How the benefits system can be streamlined with an individual budget
17.07.2025 14:15
A joint federal-state commission is expected to present proposals for a major nursing care reform later this year. This comprehensive overhaul should address not only financing issues but also the legal framework governing benefits. Simplification could include, for example, the introduction of a standardized budget.
The introduction of a budget within the statutory long-term care insurance system is part of the private health insurance sector's 10-point plan for a future-proof long-term care reform. Such a budget, which policyholders can use individually, would make the benefits system in long-term care insurance simpler and more flexible. Family caregivers and volunteers providing home care would particularly benefit.
While the benefits provided by statutory long-term care insurance already enable care tailored to the needs of those insured, the legal framework lacks transparency. Consequently, many people requiring care do not always fully utilize their available options. A flexible budget could significantly simplify this process.
This would be a budget that can be used for both outpatient and inpatient care – those requiring care can decide for themselves how they want to use their allocated budget within the framework of legally defined benefits. For example, in outpatient care, it could be used to finance existing in-kind benefits, such as the use of a home care service; in inpatient care, it could cover care-related expenses. The budget amount is tiered according to the level of care required. No lump sum payment is made.
At the same time, the care allowance would remain a benefit of the long-term care insurance. It is set at half of the budget amount. If the budget for in-kind benefits is not fully utilized, insured individuals receive a pro-rata care allowance in parallel. Half of the budget can also be used for care provided by other individuals, for example, by neighbors who have completed a caregiving course.
For example: A monthly budget of €800 is available. Of this, €400 is used for care provided by a neighbor. If the remaining budget amount is not used, a care allowance of €200 is paid for care provided by, for example, family members. This leaves a total of €600 available for care provided by informal caregivers.
„"The legal framework for long-term care benefits is highly complex today. People in need of care often don't know what they are entitled to. A flexible budget would significantly simplify access to benefits," says Anne Kristina Vieweg, Managing Director of Long-Term Care at the German Private Health Insurance Association (PKV). "At the same time, many processes involved in applying for and receiving benefits could be streamlined."“
The demand for a budget is one component of the 10-point plan of the private health insurance company for a future-proof nursing care reform.