German Health Ministry Accused Of Squandering Funds During Coronavirus Pandemic

The German health ministry led by Jens Spahn (CDU) has been criticised many times for its many lapses in the fight against the coronavirus pandemic. Now it is facing accusations of embezzlement, the auditors of the Federal Court of Auditors (Bundesrechnungshof) have concluded in a 42-page report.

The data in the report shows that the German Ministry of Health has « gifted » billions of euros to pharmacies and hospitals between 2020 and the first quarter of 2021. The auditors have listed three areas in which the authority has failed to do its job. First of all, the Court of Auditors is not satisfied with the amount of compensation to pharmacies for the distribution of free masks to particularly vulnerable groups of people. From October 2020, the Ministry of Health paid pharmacies €6 per mask, while the average wholesale price was only €1.6. In February 2021, the compensation was reduced to €3.9 per mask, but was still excessive as wholesale prices fell by 40-80%. With more than €2.1 billion spent on the free mask campaign, overpayments amounted to more than half that amount.

The second and third points in the report relate to increased funding for hospitals during the pandemic. Around €10.2 billion from the federal budget in 2020 went to enable German hospitals to provide free care to patients with the coronavirus in intensive care units.

In reality, the allocated funds covered the « business risks » of the hospitals in case they were understaffed. In fact, there has been a fan system of giving out money which has resulted in many hospitals receiving more than they are entitled to. However, since November 2020, only those clinics with less than 25% of their ICU beds were reimbursed. This, according to the auditors, may have encouraged hospitals to artificially limit the number of beds allocated to coronavirus patients.

The allocation of funds for additional ICU beds also remains unclear. The problem is that the Ministry of Health still has no accurate data on how many new beds for coronavirus patients have actually been deployed in the country’s hospitals. Official figures from hospitals, according to the report, may not correspond to reality. Between March and September 2020, clinics received €50,000 for each new bed in intensive care wards. The total compensation amounted to €700 million. A total of 13,700 new beds were to be deployed across the country, but the auditors could not obtain data from the Ministry of Health on their allocation to hospitals.

For the authority and its head Jens Spahn, the leak of the auditors’ report to the media was the second major blow in a week. On Wednesday, Suddeutsche Zeitung, NDR and WDR published an investigation into Mr Spahn’s decision to pay generous subsidies to private testing centres for conducting free rapid tests on the population was a « gold mine for entrepreneurs ».

For example, the maximum compensation was €9 until April 2021 and has been reduced to €6 thereafter.

At the same time, the real cost of one test system was €2.8 until April, after that it was no more than €2. The test centres were free to set the necessary reimbursement for the tests they carried out. The average price was €6 per test. Given that total monthly payments to private centres were in the range of €200 million, the money wasted could be in the hundreds of millions of euros.


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