Service Groups and Capacity-Based Funding: Your Department Is Documenting Its Own Future

In June, the Medizinischer Dienst (MD — the German payers' medical review service) sat in the meeting room, and for the first time no individual treatment case lay on the table. It was about the department itself: specialist physician lists with weekly hours, duty rosters, equipment evidence, cooperation agreements. By 30 June 2026, the initial audits of the Leistungsgruppen — service groups, the specialty-level planning units of the German hospital reform — had to be completed nationwide [1]. For many chief physicians, it was the first MD visit at which not a bill was under review but the existential basis of their own range of services.

The hospital reform has arrived in the departments. Anyone who last followed its status in 2024 or 2025, however, is working with outdated numbers: since April 2026, the Krankenhausreformanpassungsgesetz (KHAG — the hospital reform adjustment act, the 2026 correction of the 2024 reform) has been in force [2, 3].

What has applied since April 2026

The KHVVG (Krankenhausversorgungsverbesserungsgesetz — the 2024 hospital care improvement act, the original reform statute) has been in force since 1 January 2025; the KHAG was passed by the Bundestag on 6 March 2026, cleared the Bundesrat on 27 March and was promulgated on 14 April 2026 [2]. The points that matter most for departments:

• There are 61 nationally uniform service groups — the 60 of the North Rhine-Westphalian model plus specialized traumatology. The KHVVG had still envisaged 65 [3].
• The federal states allocate service groups by planning decision. Only allocated groups may be delivered and billed [4].
• Allocation depends on quality criteria: specialist physician numbers (38.5 weekly hours count as one full-time equivalent; one specialist can be counted toward up to three service groups per site), technical equipment, and related service groups at the site. During regular and shift duty, a specialist must be available at all times; outside those hours, on-call duty suffices [4].
• New through the KHAG: temporary allocations despite unmet criteria where they are strictly necessary to safeguard care — a basic term of up to three years, extendable. Plus expanded cooperation rules and telemedicine easements, such as teleradiological availability instead of on-site presence [5].

Who audits, and what

Fulfillment of the quality criteria is audited by the Medizinischer Dienst under the LOPS directive ("Leistungsgruppenprüfung und OPS-Strukturprüfung" — service group audits and OPS structural audits, in force since May 2025). After the initial audit round comes the regular audit every three years, to be completed within ten weeks [1].

Added to this is an obligation that arrives in the department's everyday life: if a quality criterion goes unmet for more than a month, this must be reported electronically without delay to the state, the insurers and the MD [5]. Translated clinically: a vacant specialist position is now a reportable event with consequences under planning law. The department's duty roster has become part of its legal basis.

The calendar to 2030

• 30 June 2026: initial service group audits completed — this just happened [1].
• 31 October 2026: the states report the allocations to the InEK, the institute that maintains the German DRG payment system [1].
• 12 December 2026: deadline for the service group ordinance under Section 135e SGB V and for the ordinance on minimum service volumes. Both were still pending at editorial deadline; until the ordinance arrives, the statutory annex criteria apply [6]. The minimum volumes are postponed, not scrapped.
• 1 January 2027: hospital planning on the basis of service groups.
• 2026 and 2027: capacity-based funding runs budget-neutral. 2028 and 2029: convergence phase. From 2030: full financial effect [3].

How capacity-based funding calculates

The mechanics, without controlling vocabulary: from the DRG flat rates per case (DRG: Diagnosis Related Groups, the German inpatient payment system), a Vorhalteanteil — a capacity share — of 60 percent is carved out: in essence the fixed operating costs, above all physician staffing and infrastructure; the nursing budget remains separate. The InEK determines a capacity volume per federal state from the case-weight relatives of all billed cases; it is distributed via the allocated service groups [7]. The Deutsche Krankenhausgesellschaft criticizes that the assessment thus continues to hang on prior-year case numbers rather than on real care needs [8].

Precisely this criticism contains the news for department leadership: the cases documented, coded and billed in 2026 and 2027 are the calculation basis of the convergence years. Which service group a case is attributed to is decided by coding — ICD and OPS. Whether the department keeps its service groups is decided by documented structural criteria. Both are documentation work, and both are happening now, while funding still runs budget-neutral and errors do not yet cost anything. From 2028 they do. Budget-neutral does not mean without consequence: the data of the budget-neutral years are what the later calculations will be made with.

Five points for department leadership

1. Know your own decision. Which service groups are allocated, which temporarily or as exceptions? Temporary allocations have an expiry date — whoever will not meet the criteria by then needs a plan today.
2. Run the specialist full-time-equivalent calculation yourself: 38.5 weekly hours equal one full-time equivalent, countable toward at most three service groups. This calculation belongs in ongoing staff planning — and before the next audit.
3. Treat structural evidence like billing documents. Duty rosters, specialist lists, equipment and cooperation evidence are audited again every three years — a maintained folder is cheaper than a reconstruction under deadline pressure.
4. Define a reporting process. Who learns first that a specialist position is becoming vacant, and who reports to the state, the insurers and the MD after a month? This must not run past the department.
5. Understand coding quality as a planning variable. Today's case numbers per service group are the assessment basis of the day after tomorrow. Which misconceptions are most expensive here, we have written down (in German).

The reform rewards hospitals that can substantiate what they deliver — as structure and as case. That is, for all the justified irritation about bureaucracy, a logic under which good clinical documentation becomes directly relevant to hospital planning for the first time. How data quality becomes a revenue question in the process is shown in our article on the Section 301 data pipeline (in German). And if you want to read assessments like this regularly: subscribe to our weekly briefing Visite (German; English edition Grand Rounds is in preparation), our letter on documentation, economics and AI in German healthcare.

Sources

1. Ärzteblatt. Krankenhausreform: Ab wann Kliniken Leistungsgruppen beantragen können. 24.02.2025. https://www.aerzteblatt.de/news/krankenhausreform-ab-wann-kliniken-leistungsgruppen-beantragen-koennen-d18b21ed-6986-4e16-aa83-d4ad84e811b4
2. Krankenhausreformanpassungsgesetz (KHAG), verkündet im BGBl. 2026 I Nr. 98 am 14.04.2026. https://www.recht.bund.de/bgbl/1/2026/98/VO.html
3. Bundesministerium für Gesundheit. Pressemitteilung: Bundestag beschließt Krankenhausreformanpassungsgesetz. 06.03.2026. https://www.bundesgesundheitsministerium.de/ministerium/meldungen/bundestag-beschliesst-krankenhausreformanpassungsgesetz-pm-06-03-2026
4. AOK-Bundesverband. Leistungsgruppen als Grundlage der Krankenhausplanung. https://www.aok.de/gp/qualitaet/stationaere-versorgung/leistungsgruppen-als-grundlage-der-krankenhausplanung
5. Forvis Mazars. KHAG im Bundestag beschlossen. https://www.forvismazars.com/de/de/branchen/life-sciences/khag-im-bundestag-beschlossen
6. Bundesministerium für Gesundheit. Leistungsgruppen-Ausschuss. https://www.bundesgesundheitsministerium.de/themen/krankenhaus/krankenhausreform/leistungsgruppen-ausschuss.html
7. Rödl & Partner. Die neue Vorhaltevergütung der Krankenhäuser. https://www.roedl.com/insights/bezahlung-krankenhaeuser-neue-vorhalteverguetung/
8. Deutsche Krankenhausgesellschaft. Stellungnahme zum KHAG-Gesetzentwurf. 15.12.2025. https://www.dkgev.de/fileadmin/Mediapool/1_DKG/1.3_Politik/Stellungnahmen/2025-12-15_DKG-Stellungnahme_KHAG_Gesetzentwurf_inkl._Anlage.pdf