Homes for the elderly and disabled are an essential part of the healthcare system. Due to increasing life expectancy and the growing proportion of senior citizens in the population, the demand for such facilities is also increasing. In the last five years, turnover in the sector has risen by an average of 1.3% per year. However, the dynamic cost trend has recently put pressure on the industry's earnings situation and caused many industry players to experience financial difficulties, which has increased the risk of insolvency. Operators have been faced with rising costs for energy, accommodation and catering, which have not been sufficiently refinanced by the cost bearers.Additional economic challenges are posed by rising personnel costs. For example, the parties to the collective agreement have agreed on further salary increases in 2024 in addition to an inflation adjustment. In addition, the changeover to the new staff assessment procedure means that skilled and unskilled staff will be factored into care rates. All of this is compounded by a worsening staff shortage, which is leading to lower capacity utilisation. To avoid getting into financial difficulties, the additional costs are largely passed on to the residents, while the care insurance companies' fees are barely adjusted. An increase in turnover of 0.8% is expected for 2025 compared to the previous year, bringing total turnover to 28 billion euros. One growth driver in the sector is the provision of alternative forms of living. Assisted living facilities have become increasingly popular in recent years. The high demand for this form of living means that flats designed for this purpose are being built as part of almost all new construction projects in the sector.Over the next five years, IBISWorld expects an average annual growth rate of 3.4%, which means that turnover is likely to reach 33 billion euros by 2030. There is growth potential for the industry in the areas of energy efficiency, digitalisation, innovation and connected living. The positive development is likely to attract numerous new operators to the sector, meaning that the number of companies active on the market is expected to increase by an average of 2.7% per year until 2030. As competition intensifies, there will be an even greater focus on maximising profits and cutting costs, which may have a negative impact on the quality of care.

Germany Health & Medical Insurance Market Size was valued at USD 54.08 Billion in 2024 and is projected to reach USD 59.18 Billion by 2032, growing at a CAGR of 3.73% from 2025 to 2032.

Key Market Drivers Aging Population and Demographic Shift: The progressive increase in Germany's elderly population, coupled with rising life expectancy, has created a substantial demographic transformation. This shift places increased pressure on healthcare services and insurance systems, as older populations typically require more frequent and complex medical care, driving demand for comprehensive health insurance coverage.As of 2022, 22.1% of Germany's population was aged 65 or older, up from 21.8% in 2020. The average life expectancy in Germany reached 83.2 years for women and 78.2 years for men in 2021. Rising Healthcare Costs: The continuous increase in medical treatment costs, pharmaceutical prices, and healthcare service expenses has become a significant driver for the health insurance market. This trend reflects technological advancements in medical procedures, innovative treatments, and the overall inflation in healthcare services. Healthcare expenditure in Germany reached €440.6 billion in 2020, an increase of 14.3% compared to 2019. Prescription drug spending rose by 6.9% in 2021 compared to 2020. Digital Healthcare Transformation: The integration of digital health solutions, telemedicine, and electronic health records has revolutionized healthcare delivery in Germany. This technological advancement has created new insurance products and coverage needs, driving market growth and innovation in insurance offerings. The Digital Healthcare Act implementation led to 73% of statutory health insurers offering digital health applications by 2022. Telemedicine consultations increased by 900% during 2020-2021.