GBK Cologne needs 18 million for debt relief

The financial health insurance company GBK in Cologne needs 18 million euros to merge. The health insurance "mhplus" signals an interest in the merger. A final decision should be made by Friday.

11/25/2010

As already reported, the two company health insurance funds GBK based in Cologne and the City BKK are in financial distress. Both funds are in acute danger of bankruptcy. The tops of the company health insurance BKK had decided last Friday to help both ailing health insurance companies under the arms. For the ailing GBK a fusion partner is to be found. City BKK is going through a debt relief program.

The GBK has just 30,000 members. On such a scale, it is becoming increasingly difficult to assert itself on the cash register market and to respond to economic bottlenecks. Although the GBK was one of the first health insurance companies to demand an additional contribution from its insured, two seriously ill members were in dire straits. A total of 18 million euros of debt have accumulated in recent times. A sum that is difficult to remove by the GBK itself. For this reason, a suitable fusion partner should be found for the fund. Because a closure would have probably caused millions of dollars.

As a possible partner for a merger Mhplus is currently valid. According to its own information, the mhplus health insurance company is ready to examine a reorganization merger with the joint occupational health insurance fund of the city of Cologne at short notice. „In order to mitigate the financial consequences of a merger and thus the restructuring of the GBK, however, financial compensation payments by the company health insurance funds (BKK) in Germany are required“, as the cash register explained today.

By the end of this week, the top representatives of the BKK now want to vote on whether the proposed merger will be approved and whether a previous exemption from the burden of millions takes place. According to its own statements, mhplus is prepared to examine a restructuring merger with the GBK if the company health insurance funds in Germany jointly pay for the reorganization and merger consequences. The financial aid of the BKK-Verbund is set for a merger.

Closing the GBK could cost the BKK much more. Currently, the cost of closure is estimated at around € 22.3 million. Whether the company health insurance funds agree to a reorganization merger with mhplus is still open. According to mhplus, there is no common attitude among the BKK in Germany.

For the GBK, a hearing has already been initiated by the Federal Insurance Office (BVA), which could be closed at the end, should the fund fail to find a merger partner. The costs of a merger put health economists at around 18 million euros.

The mhplus seems to have a much better economic position despite being regionally anchored. An additional contribution will not be levied at mhplus, unlike GBK from 2011. The GBK will charge a maximum additional contribution of € 37.50 / one percent of the gross wage. At mhplus, 540,000 people have health insurance. If both funds merged, a total of 570,000 people would be insured in the merged health insurance. (Sb)

Also read:
Rescue of the ailing health insurance companies
Bankruptcy of health insurance funds averted
Health insurance City BKK & GBK threatened by bankruptcy
City-BKK saved from insolvency?
Is the health insurance City-BKK broke?
Two health insurance companies are broke

Image: Benjamin Klack