We examine the implications of the EU directive on the application of patients’ rights in cross-border healthcare on the German sickness fund system. Since Germany implemented most requirements of the directive already in 2004, we first review Germany’s experience with EU cross-border healthcare. We then focus on the possible effects of increased EU cross-border healthcare. While this gives patients more choice, the German sickness fund system faces a number of challenges. EU cross-border care may undermine efforts to keep healthcare expenditure under control. Cross-border care can also increase inequality of access. Furthermore, promoting cross-border care can be a means for sickness funds to attract good risks. We discuss these challenges and point out possible policy responses.