Raue sues for Agaplesion against anti-competitive hospital financing by the City of Frankfurt am Main

With the support of Raue, the non-profit Christian hospital association Agaplesion and Agaplesion Frankfurter Diakonie Kliniken gGmbH have filed an action for an injunction against the City of Frankfurt am Main with the Frankfurt Administrative Court. The aim of the proceedings is to clarify the legality of the city’s financial compensation to cover the deficit of the municipal varisano Klinikum Frankfurt Höchst.

In 2022 and 2023, the city compensated the deficit of Klinikum Höchst with payments of more than €47 million, while other hospitals in Frankfurt were denied such payments.

The majority of hospitals in Germany are under severe economic pressure due to inflation, increases in personnel costs as a result of collective bargaining agreements, and underfunding by the federal and state governments. So far, however, only municipal hospitals have received millions of euros in taxpayers’ money as financial compensation. Unlike other hospitals, municipal hospitals are in a position to compensate for massive deficits. It is much easier for them to make large investments and spend more money on staff. This financing practice distorts competition and violates the fundamental rights of competing hospitals, hospital financing law, EU state aid law and budgetary law.

Dr Maren Bedau, Raue’s specialist lawyer for medical law and an expert in hospital planning and financing law, explains: “The same financing rules apply to all hospitals in Germany. It is up to the federal states to finance investments in hospitals. However, the City of Frankfurt, as the municipal owner of varisano, grants its ‘own’ hospital group additional budget funds that the other hospitals in the area do not receive, even though all hospitals have a so-called care mandate under planning law. This compensation is incompatible with the statutory financing system for planned hospitals and constitutes unconstitutional discrimination between non-profit and private providers. In addition, the selective special financing in favour of public hospitals violates EU state aid law”.

Raue advises Agaplesion comprehensively on public commercial law, hospital financing law, state aid law and budgetary issues and represents Agaplesion Frankfurter Diakonie Kliniken gGmbH before the Administrative Court of Frankfurt am Main.

About Agaplesion

Agaplesion was founded in 2002 in Frankfurt am Main by Christian companies to strengthen predominantly Christian healthcare facilities in a challenging economic and competitive situation. Agaplesion has more than 100 facilities throughout Germany, including 22 hospitals with 6,443 beds, 39 residential and nursing homes with 3,524 places, five hospices, 34 medical care centres, seven outpatient care services and a training academy. 22,000 employees provide patient-centred medicine and care according to recognised quality standards.

(26 March 2024)