Context: Internationally, a variety of reimbursement systems exists for palliative care (PC). In Germany, PC units (PCUs) may choose between per-diem rates and diagnosis-related groups (DRGs). Both systems are controversially discussed. Objectives: To explore the experiences and views of German PCU clinicians and experts for PCU financing regarding per-diem rates and DRGs as reimbursement systems with a focus on (1) cost coverage, (2) strengths and weaknesses of both financing systems, and (3) options for further development of funding PCUs. Design: Qualitative semistructured interviews with PCU clinicians and experts for PCU financing, analyzed by thematic analysis using the Framework approach. Setting/Subjects/Measurements: Ten clinicians and 13 experts for financing were interviewed June-October 2015 on both reimbursement systems for PCU. Results: Interviewees had divergent experiences with both reimbursement systems regarding cost coverage. A described strength of per-diem rates was the perceived possibility of individual care without direct financial pressure. The nationwide variation of per-diem rates and the lack of quality standards were named as weaknesses. DRGs were criticized for incentives perceived as perverse and inadequate representation of PC-specific procedures. However, the quality standards for PCUs required within the German DRG system were described as important strength. Suggestions for improvement of the funding system pointed toward a combination of per-diem rates with a grading according to disease severity/complexity of care. Conclusions: Expert opinions suggest that neither current DRGs nor per-diem rates are ideal for funding of PCUs. Suggested improvements regarding adequate funding of PCUs resemble and supplement international developments.