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Why Germany becomes a top country for digital health solutions

On 7. November 2019, the German House of Parliament passed new rules supporting digital innovation in Germany. The new rules will have a far-reaching impact on the public health insurance of the 72 million insured citizens. Physicians are able to prescribe medical apps. Telehealth offerings are planned to become the norm. Access to medical patient’s data is provided to research organizations. It all starts 2020/2021!

Germany has always been a market that looked attractive from the outside for digital health startups worldwide. Yet there are hundreds of examples of digital health innovators from Germany and companies from outside that either moved out again or failed all together. Restrictive regulations and persistence of the established health system seemed to be too large.

Now, regulations have been changed over the course of the last months with a major milestone on November 7th 2019. The new rules will have a major impact on the success rate of digital health solutions provided to residents insured in Germany and HCPs.

The major changes are:

  1. Doctors are allowed to prescribe medical apps. Starting from the beginning of 2020, medical apps that have passed data security and functionality tests by the BfArM can be prescribed by HCPs. Medical app providers will be given the chance to prove the effectiveness of their solutions within one year and negotiate pricing with the umbrella organization of the public German health insurance companies.
  2. Telehealth consultations become the norm. HCPs are allowed to actively promote their telehealth services to patients on e.g. their websites. Pricing for telehealth services is still negotiated but is supposed to be solved soon.
  3. Improved access to patient data for research. German public health insurances are forced to send anonymized member demographics and health data to a central database managed by the German government. Research organizations and universities can request access to data for research purposes.
  4. Every insured member will have access to an electronic health record. By January 2021 every member of a public health insurance (72 Mio) must have access to an electronic patient record.
  5. HCP patient communication and prescriptions is moved to electronic channels. Electronic prescriptions for medication, remedies and aids, doctor letters and certificates of disability for employers will now be allowed. Traditional fax communication is made less attractive.
  6. Pharmacies, HCPs and hospitals are forced to connect to secure communication networks. Every pharmacy (Sep 20) and hospital/HCP (Jan 21) must connect to the German secure health data network provided by the Gematik. In case of non-compliance, there will be financial penalties.
  7. Health insurers will offer online member sign ups.
  8. Health innovation will be financially supported. German government prolonged EUR 200 Million yearly funding for 4 years to support innovation projects in healthcare.

Although new rules are setting the framework for a thriving digital health market in Germany there are, of course, questions on how long it will take before the impact is made visible.

Bottlenecks still exist and they might slow down the digital transformation of the German healthcare system. There are a lot e.g.:

  • How efficient will regulatory bodies be able to test new applications? Nominated bodies will have to organize and streamline their processes to cope with the high amount of incoming certification requests from medical app publishers.
  • How do patients and HCPs get to know which medical apps they can subscribe and what for? App trainings or even organizational integration support will be needed to support the adoption.
  • How will health insurance companies and hospitals manage the large eco-systems of digital solutions? Currently companies are partnering more on an ad-hoc basis, but they will have to switch to a more systematic approach to be able to manage dozens/hundreds of solutions and support their adoption.
  • How to prove the effectiveness of the medical apps within one year? This could be a very challenging tasks if adoption is low due to a slow implementation of member onboarding, communication processes or success monitoring. After all, a year passes quickly!

Despite the many challenges, and the new ones to arise, the German healthcare market should be ranked high again on the geographical roadmap of international digital health providers. Market entry options are better than ever before.

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