Hamburg – Following a seven-year lawsuit, the Federal Social Court (BSG) has allowed a lawsuit brought by the company health insurance fund (“BKK”) of Scheufelen paper factory (BKK Scheufelen) against the BKK Federal Association (BdB) (B 12 KR 29/10 R). The action was directed at contribution notices issued by the BdB which had called on BKK Scheufelen to participate in covering the cost of a bailout for three company health insurance funds. The rescue subsequently failed.
One of the distressed company health insurance funds was the BKK for healthcare professions. For many years, the management of the fund had unlawfully taken out loans to enable low contribution rates. In 2004, the BKK was then faced with an insurmountable mountain of debt of more than EUR 350 million.
The BKK Federal Association provided more than EUR 300 million in financial support to the aforesaid BKK and to other heavily indebted health insurance funds. The BKK Federal Association spread the cost of doing so within the BKK system at national level, following approval by the BKK regional associations. The asymmetrical method of contribution chosen in the process led to extremely unequal treatment of some insurance funds. Several BKKs resisted this and set up the BKK Fair Competition Initiative (BIF).
In a test case, Stuttgart Social Court initially decided in favour of BKK Scheufelen in some respects. The Regional Social Court of Baden-Württemberg then dismissed the lawsuit on appeal. In the subsequent appeal to the highest court, the 12th Senate of the BSG has now allowed the lawsuit in full and lifted the contested contribution notices. The court followed the argumentation of BKK Scheufelen to the effect that the bail-out approval given by the BKK regional associations of Baden-Württemberg and North Rhine-Westphalia had been unlawfully made dependent on conditions and was therefore null and void. The BKK Federal Association must now make a refund in respect of the contribution notices that have already been paid.
The judgment is a test case for the other proceedings pending before various social courts and regional social courts, involving notices totalling more than EUR 100 million. CMS Hasche Sigle has been representing BKK Scheufelen and 16 other BIF funds in court since 2005 and advises BIF with regard to assistance granted to heavily indebted health insurance funds.
Advisers CMS Hasche Sigle
Dr Fritz von Hammerstein, Lead Partner
Dr Christiane Kusche, both Public Law
Press Contact
presse@cms-hs.com
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