Health minister raises spectre of 'locusts' swooping on Germany's medical centres

Backlash against 'financialisation' of outpatient treatment centres

Germany's controversial health minister Karl Lauterbach raised the spectre of the Heuschrecken, or locusts, looming over the German real estate industry for the first time in nearly fifteen years recently, when he vowed to push through a law preventing financial investors taking over the premises of medical practitioners.

Lauterbach wants to table a bill in the first quarter of 2023 which would block "profit-hungry" investors from buying up properties containing bundled-up outpatient medical practices. "We're seeing a disastrous trend in investors buying up medical care centres with various specialist practices, in order to subsequently operate them at maximum profit", he said. His bill "would prevent these locusts from having any access to these medical practices", he said.

Also in his sights are chains of large practices, often marketed by 'celebrity' doctors but occupied by younger, inexperienced doctors working in a sort of 'franchise' concept to achieve ambitious profit goals.

"These practices have to belong to those who actually work there, not those working to absurd profit concepts," said Lauterbach. "Anything targeting 10% returns or more is barely achievable while providing serious medicinal treatment. A top-quality clinic should be able to make a profit - but if all we're offering is standardised prices, then the cheap cut-price discounter is likely to make surplus profits at the expense of the university clinic with its high-end surgery."

Minister Lauterbach's initiative was welcomed by the umbrella organisation of Germany's statutory health insurance companies (GKV) and the German Federation of Trade Unions - Deutsche Gewerkschaftsbund (DGB).

DGB board member Anja Piel commented that, "Only if the health service puts humans and not profits at the heart of its operations can we get good medical supply for all. Lauterbach is on the right track by putting a stop to unrestrained profit, which we're increasingly seeing where new doctor arrivals are working alongside more established medical offerings."

Florian Lanz of the GKV said in an interview with news agency AFP that the attraction of buying medical practices for investors was less about their premises and equipment, but more about the license - the right to be allowed to bill the statutory health insurance companies. The high cost of getting this license tends to put off young doctors taking over an existing practice, and draws in larger investors to buy and run the operations.

"It would be much fairer to give these licenses specifically and free of charge to these young doctors where they are needed for good local medical care, instead of doctors selling them to the highest bidder, " said Lanz.

A TV documentary in April 2022 by the investigative team at ARD's Panoramaprogramme highlighted how hundreds, possibly thousands, of doctors' practices (Medizinische Versorgungszentren - MVZ) were being sold off in this manner in Germany. Health experts are complaining that practices are increasingly being taken over by profit-driven companies, and more and more doctors in private practice are thus being bundled into these MVZs.

Health experts have long been complaining that medical practices are increasingly being taken over by profit-oriented companies and that more and more seats of physicians in private practice are thus being bundled into MVZs. Ophthalmologists, in particular, seem to be particularly attractive to investors.