New procurement procedure for medical rehabilitation pursuant to Section 15 SGB VI and competition law The dual role of German pension insurance

The dual role of German Pension Insurance

The pension insurance institutions have a dual role in the area of medical rehabilitation.

In their first role, the pension insurance institutions decide on the admission of private or independent rehabilitation facilities to provide care in accordance with the new reform pursuant to Section 15 (5) SGB VI by virtue of sovereign authority. The lead pension insurance institution therefore decides on the market entry of private or independent rehabilitation facilities. Following the approval decision, it is the responsibility of the lead pension insurance institution to conclude an occupancy contract with the approved rehabilitation facility (Section 15 (6) SGB VI). The pension insurance institutions are also responsible for suggesting suitable rehabilitation facilities for the insured persons. According to the current status, the so-called 2+2 regulation is to be introduced for this purpose, according to which, whenever the insured person does not make use of their right to choose and suggest a facility, the pension insurance institution will suggest two private and two DRV-owned facilities to the insured person (see Section 15 (6a) SGB VI). The above tasks are sovereign activities that are traditionally performed by service providers (DRV, health insurance funds, long-term care insurance funds, etc.).

However, the pension insurance institutions also take on a second role as service providers: With DRV-owned rehabilitation facilities, they actively participate in the market and compete with private and independent rehabilitation facilities. Just like private rehabilitation facilities, they provide medical rehabilitation services and advertise for patients, for example, with the DRV's own clinic search.

Under this system, the pension insurance institution, as someone who participates in the market itself, can determine who is included among its competitors by deciding on admission and concluding contracts. In other words, a competitor controls market access, the quality of the services offered on the market and, via the remuneration system, also the price. The planned 2+2 rule in particular shows that this power can lead to an overreaching of the DRV's own facilities and that the German Pension Insurance institutions are anxious to allocate sufficient patients to their own facilities. In addition, the DRV's own facilities have an advantage that no privately run rehabilitation facility can have: The losses generated can be absorbed by using money from the pension insurance scheme. Unlike private facilities, the DRV's own facilities are therefore not forced to act profitably. The participation of DRV-owned institutions in the market prevents viable competition. As the private institutions are bound by the de facto remuneration rates set by the pension insurance institution (Section 15 (8) sentence 2, (9) sentence 1 no. 2 SGB VI), this could result in the complete crowding out of private institutions and thus the elimination of competition.

Complaints against § 15 SGB VI new version

Partly due to this dual role of the pension insurance institutions, Brosius-Gersdorf/Gersdorf come to the comprehensible conclusion in their report that the performance of sovereign tasks while simultaneously carrying out entrepreneurial activities is incompatible with European competition law: Union law requires a separation between the exercise of sovereign powers and entrepreneurial activity. This separation is disregarded by the dual activity of the German pension insurance institutions. The new system of § 15 SGB VI thus violates European competition law.

Brosius-Gersdorf/Gersdorf therefore propose genuine co-determination of private and independent rehabilitation facilities and self-administration, as is common in other areas of German social law.

Private rehabilitation facilities should take the report as an opportunity to lodge complaints with the European Commission against the new system of § 15 SGB VI. These complaints can be submitted using a form provided by the European Commission.