German hospitals may face ‘unprecedented’ wave of bankruptcies: Survey

BERLIN

The German Hospital Federation on Tuesday warned of an “unprecedented” wave of bankruptcies next year due to the energy crisis and high inflation.

“Our clinics could be hit by a wave of insolvencies in 2023,” Gerald Gass, the group’s chairman, told local media, adding that the government’s financial aid plan has been insufficient.

According to an annual survey conducted by the German Hospital Institute, 59% of hospitals expect massive financial losses this year, and they are already operating on negative margins.

Currently, only 21% of hospitals hope for a balanced result for the 2022 financial year.

The survey also found that 56 % of hospitals expect the economic situation to further deteriorate next year.

Gass criticized the government’s inadequate response to the current crisis.

“Health Minister Karl Lauterbach had said that the medicine has priority over the economy, but this remains an empty promise," he told news outlet RedaktionsNetzwerk Deutschland.

Gass said while the government’s recent plan to compensate energy price increases was a positive development, it was not sufficient, as hospitals need more financial support due to inflation-related general cost increases.

According to German Hospital Federation estimates, hospitals need around €15 billion ($16 billion) financial support to overcome the current crisis.