Berlin – “The situation is serious for reliable patient care with innovative and high-quality aids in Germany. The negative assessment of the innovation climate is increasing. The importance of the German market is threatening to decline.” This is the conclusion of Oda Hagemeier, Managing Director of the European Manufacturers Federation for Compression Therapy and Orthopedic Devices (eurocom) on the results of the 2023 member survey conducted in May. 92 percent of the members give their assessment on the situation of the medical aids market and its general conditions in Germany. What is particularly worrying is that 63 percent of those surveyed rated the local innovation climate as below average. And even if Germany is currently still the most important market for 86 percent, a quarter of those surveyed see it only in second place in five years. Causes include location risks, such as bureaucratic hurdles (91 percent), the lack of skilled workers in the own companies (59 percent) and in specialist shops/in craft businesses (47 percent). On the other hand, the major barriers to innovative quality products on the German market are a cause for concern: All survey participants are affected by long-term, enormous cost increases due to inflation, the energy crisis and regulations. A further complication is the burden of non-uniform VAT rates, which distort competition
(87 percent). In addition, in year three after the introduction of the eurocom industry barometer, the list of medical aids proved to be a brake on innovation for 68 percent of those surveyed.
Persistent cost explosion jeopardizes security of supply
Above all, the 2023 member survey sheds light on the serious consequences of the extreme cost increases for the medical aids industry that have been going on for two years now: 100 percent of the survey participants are affected. Likewise, 100 percent are still unable or only partially able to pass on cost increases to the market. The main reason for this is that reimbursement prices in the supply contracts are fixed for the long term (73 percent). For 100 percent of the companies, this means that the production of medical aids is already uneconomical. This negative trend, which is more pronounced than in the previous year (89 percent), will have serious consequences if this situation persists: 73 percent of those surveyed fear a reduction in their portfolio, and 70 percent fear that jobs will be cut in their own company. Around a quarter see this as a threat to their existence, and every fifth company fears a supply bottleneck. The logical consequence for 67 percent of the members: A cost cushion is urgently needed. 87 percent identify the adjustment of the contract prices and 93 percent the adjustment of the fixed amounts as suitable measures, in each case by the inflation rate.
“Ensuring reliable patient care is a challenge for the industry that cannot be left alone. In order to be able to produce and supply reliably in the long term, price increases must not be unilaterally at the expense of manufacturers and service providers. For this reason, on the one hand, fixed amounts must be retained as a sensible instrument for regulating expenditure and, like the contract prices, must be adjusted annually for the rate of inflation, and on the other hand the different VAT rates for medical aids must be lowered uniformly,” demands the eurocom managing director.
Make innovations more accessible
The pronounced will to innovate in the medical aids industry is also evident in 2023. All participants invest in digitization, 97 percent in research and development – up to 10 percent of the company’s turnover, 81 percent in new types of aids. This stands in stark contrast to the braking effect that the unsafe procedure for listing new products in the list of medical aids (HMV) continues to have for a majority of companies: as in previous years, more than 60 percent of the survey participants see potential risk in this and rate it as the greatest obstacle to innovation. In the past ten years, 57 percent of those surveyed rejected applications for new aids, and 82 percent of them affected at least two new developments. Rejections by 43 percent of the survey participants even extend to aids that are already known.
Oda Hagemeier explains: “In order for patients to have unhindered access to innovative aids, their uptake must be accelerated. Because the list of medical aids has a market-controlling effect, even if it is not a positive list. We still need a standardized procedure, especially for the recognition of medical evidence of benefit. The proof must be realistic and plannable. That is why eurocom calls for an obligatory consultation that clearly regulates the agreements between the applicant and the National Association of Statutory Health Insurance Funds – for an innovative and future-proof supply of medical aids in Germany.”
About eurocom
eurocom is the manufacturer association for compression therapy, orthopedic aids and digital health applications. The association sees itself as a designer and dialogue partner on the healthcare market and is committed to spreading knowledge about the medical benefits, effectiveness and cost-efficiency of compression therapy and orthopedic aids. In addition, eurocom is developing concepts on how the provision of medical aids can be ensured now and in the future. Almost all European companies operating in the German market in the fields of compression therapy and orthopedic aids – currently 37 – belong to the association.