Transformation Fund approved in Germany

On March 21, 2025, the Federal Ministry of Health (BMG) announced that the establishment of the Transformation Fund, one of the key elements of the approved hospital reform, was formally endorsed by the Federal Council (Bundesrat) through a corresponding legal ordinance.

The Transformation Fund will make available up to €50 billion over a 10-year period beginning in 2026 to support the modernization of hospital infrastructure. Up to €25 billion will be sourced from the liquidity reserve of the Health Fund, while the remaining €25 billion must be matched by contributions from the federal states. States may also involve hospital operators benefiting from funded projects to share in the co-financing of associated costs.

The legal ordinance outlines the eligibility criteria and governs the administrative processes for the Fund. The core objective is to finance projects that advance the transformation of inpatient care based on service groups and support the development of centralized, high-quality care structures.

All funding applications and administrative processes will be handled via a dedicated digital portal. The federal states will be granted significant flexibility, including options for partial disbursement and submission of follow-up applications.

The Federal Office for Social Security (BAS) will oversee the application process. To promote transparency, BAS will publish monthly summaries of key funding data on its website, providing insights into the progress of transformation initiatives.

To ensure legal compliance, implementation of funded projects cannot begin before July 1, 2025, although planning activities may commence earlier.

The full details in German can be found here.

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