German Government Approves Two-Stage Increase in Pharmacy Remuneration

The German coalition government has agreed to a two-tiered increase in the fixed dispensing fee paid to pharmacies, following a decade in which the remuneration remained stagnant. This adjustment comes as part of an amended regulation jointly submitted to the Federal Chancellery by the Federal Minister of Health and the Federal Minister for Economic Affairs, both representing the Christian Democratic Union (CDU).

Background and Rationale

Since 2013, the fixed fee per prescription package dispensed by pharmacies has been set at EUR8.35. Over the intervening years, pharmacies have faced rising operational costs, which have placed increasing pressure on their financial viability. Recognizing the essential role pharmacies play in delivering healthcare services across Germany, the ruling coalition, comprising the CDU and the Social Democratic Party (SPD), included a commitment to increase the dispensing fee in their coalition agreement.

Details of the Increment

The planned increase will occur in two phases. In July, the fixed dispensing fee will first rise to EUR9.00 per package. This initial step is designed to address the immediate financial needs of pharmacies while also taking into account the current fiscal challenges faced by statutory health insurers (GKV). The government aims to balance support for pharmacies with the necessity of containing healthcare expenditure within manageable limits for the remainder of the year.

At the start of the following year, the fixed fee will further increase to EUR9.50, fulfilling the coalition's original commitment. This two-step approach is explicitly intended to spread the financial impact on statutory health insurers over a longer period, thereby reducing budgetary strain in 2026.

Financial Implications

The incremental rise in the fixed dispensing fee is expected to result in significant additional costs for statutory health insurers. The first increase to EUR9.00 is projected to generate extra expenditures of approximately EUR250 million for statutory insurers in 2026, including value-added tax. When the fee reaches EUR9.50 from January of the following year, annual additional costs are estimated at around EUR875 million.

Public sector health aid (Beihilfe) and private health insurance (PKV) will also bear a share of the increased costs. Based on the assumption that about one-third of affected prescriptions fall under public sector aid and two-thirds under private insurance, Beihilfe providers across federal, state, and municipal levels are expected to face increased costs of around EUR20 million in 2026, with this figure rising to approximately EUR73 million annually after the second stage comes into effect.

Further Regulatory Measures

In tandem with the fee increases, the government has announced plans to adjust the so-called 'Kassenabschlag', a mandatory rebate pharmacies must grant to statutory health insurers. From January 2027, this rebate is scheduled to rise from EUR1.77 to EUR2.07 per prescription package, partially offsetting the effect of the remuneration increase for statutory insurers. Notably, this rebate does not apply to private insurers or public sector aid, meaning pharmacies will fully benefit from the increased fixed fee in these segments.

Industry and Stakeholder Reactions

Pharmacy associations have voiced concerns that the simultaneous increase in the mandatory rebate could reduce the positive financial impact of the higher dispensing fee for pharmacies, particularly those predominantly serving patients insured under the statutory health system. Nonetheless, the staged increase is broadly viewed as a necessary step to address longstanding economic pressures within the pharmacy sector.

The government's decision not to introduce stricter controls on mail-order pharmacy operations, as initially proposed in earlier drafts, is intended to facilitate swift implementation of the new remuneration framework. Emergency services provided by pharmacies will, for the time being, continue to be financed from existing service funds.

Impact on Healthcare Provision

By adjusting the dispensing fee, the government aims to stabilize the financial situation of community pharmacies, ensuring the continued availability of pharmaceutical services throughout Germany. The reform is positioned as a measure to safeguard the broader healthcare infrastructure and maintain equitable access to medicines for both publicly and privately insured citizens.