Setting up your own practice in Germany
The financing is not the hard part. The order is. A single signature in the wrong week destroys a subsidised loan you can never recover — and no bank, no notary and no seller will warn you, because it is not their job.
Four gates stand between you and a bank appointment
In Germany, treating patients insured under the statutory system — which is roughly nine out of ten patients — requires more than a medical degree. It requires a chain of approvals, and a lender will not finance a practice for someone who has not yet cleared them. In order:
- Approbation — the full licence to practise medicine. For qualifications obtained outside the EU this involves recognition of your degree and, in practice, a specialist language examination in German. There is no way around this and no English-language route through it.
- Specialist recognition (Facharzt) — awarded by the state medical chamber (Landesärztekammer). Only a recognised specialist can hold a practice licence in that discipline. Recognition of specialist training completed abroad is decided case by case and can take considerable time.
- Entry in the medical register (Arztregister) — held by the regional Association of Statutory Health Insurance Physicians (Kassenärztliche Vereinigung, KV). This is the precondition for applying for admission.
- Admission (Zulassung) — granted by the admissions committee (Zulassungsausschuss). In most urban areas the planning district is closed, which means you cannot simply open a practice: you take over an existing one through a succession procedure, and the admission is what you are really acquiring.
Only after that fourth gate does a bank have something to finance — because only then does the practice have a legal basis to earn.
The subsidised loan must be applied for before you sign anything
Germany’s state development bank, the KfW, offers the cheapest capital available to a practice founder — including a facility that carries an 80 % indemnity for the lender, which is the single reason foundations without collateral get financed at all. It comes with one absolute rule:
“Beginning” is defined as the conclusion of any contract attributable to the project — the signed practice purchase agreement, the lease for the premises, the order for the treatment unit. Once one of those is signed, the funding is gone. There is no retroactive application, no discretion, no exception. This is not a bank policy. It is the programme rule.
Almost every funding failure I see is a sequencing failure, not a credit failure. The founder finds the practice, agrees terms, signs to secure it — and only then starts looking for financing. By that point the cheapest component of the capital structure has been forfeited, and nobody involved had any reason to mention it. Details on practice financing.
The KV grants exist — but they will not meet you in English
Every regional KV is required by law to operate a structural fund, and most of them use it to pay investment grants to physicians who set up in under-served districts. The amounts are substantial: in one region a full admission can attract a grant in the high five figures. In another there is no flat grant at all.
Three things international doctors should know before building any of this into a plan:
- It is not equity. Most schemes reimburse against invoices after you begin practising. You will have paid for the equipment already — with the bank’s money. The grant reduces the debt later; it does not reduce the capital you need on day one.
- It is not a right. Funding is discretionary and capped by the fund; in some regions applications are ranked by date of receipt, in others by selection criteria, and in some the money is simply exhausted.
- It is conditional. Five years of practice in the funded district is the usual commitment. Leave early and a proportion is reclaimed.
None of this documentation exists in English. The directives, the district lists and the application forms are German-language instruments of German public law, and the KV will correspond with you in German. That is precisely the work I take off your desk — I read the current directive for your planning district and tell you what it is actually worth in your financing plan, rather than what a comparison article claims. The full analysis, region by region, is in the German-language KV funding cluster.
Goodwill is the number the bank argues about
When you take over a practice in a closed planning district, most of the purchase price is not equipment. It is goodwill — the patient base, the location, the admission itself. And goodwill has a property that makes lenders uncomfortable: it cannot be realised. A treatment unit can be sold at auction. A patient base cannot.
This is why practice financing for an incoming physician turns on two questions and not on the purchase price: can the practice’s own earnings service the debt (including your private living costs), and what security remains if it cannot? Where the answer to the second is thin — and with a high goodwill component it always is — the first becomes decisive, and the instruments that bridge the gap are the KfW indemnity and a guarantee-bank surety, not a regional grant.
What a foreign qualification does not do is worsen those numbers. Once you hold the admission, you are a German practice owner like any other. The obstacles are in front of the admission, not behind it.
Answered briefly
Can I buy a practice before my admission is granted?
Do I need German for the practice itself?
Is it cheaper to open a new practice than to take one over?
Can I finance a practice and a home at the same time?
Talk to me before you sign, not after
A free consultation in English: what your sequence must look like, what funding your district actually offers, and what the practice has to earn for the numbers to work. Independent of any single bank — from a panel of more than 500.