Originally Published EMDM
January/February 2004
A NOTE FROM THE EDITOR
Does the Ailing German Healthcare System Really Need a Crutch?
Germany is facing a dilemma. How do you maintain a generous social safety net for an aging society when healthcare costs are spiraling upward? The chairman of the Young Union, the youth wing of the opposition Christian Union parties, has an idea. “I don’t think much of 85 year olds having hip replacements paid for by the rest of society,” Philipp Missfelder, 25, told a reporter for a daily newspaper in Berlin. In the old days, “people used to walk with crutches.” Now that’s what I call thinking outside of the box. It should come as no surprise that a generational row erupted, which has been widely reported in the German media.
Obviously, Missfelder is a provocateur with a seeming talent for self-promotion. But in his cheeky way, he raises an issue that is bound to polarize society in the coming years. As fewer and fewer young workers bear the healthcare costs of a rising tide of retirees, questions will be asked, and not always politely. Clearly some adjustments must be made if the cradle-to-grave welfare state is to avoid a meltdown. I don’t think a return to crutches is in the picture, though. The implementation of leading-edge technologies can provide solutions that improve patient care and cut costs. In particular, it’s time to take a serious look at telemedicine as a cure for what ails Germany’s healthcare market. That is the belief of Katherine Shariq, an industry analyst with Frost & Sullivan, who presented her thesis at the Medica Media Forum in Düsseldorf.
The looming crisis in German healthcare may have a positive impact on the adoption of telemedicine, according to Shariq. “The convergence of healthcare reimbursement reforms, an aging patient population, and the need for greater efficiencies” is forcing change, she said. There is a “groundswell for medical technologies that go beyond traditional processes and applications.”
Germany’s telemedicine market currently is valued at e144.5 million. Imaging applications, made possible by the proliferation of ISDN lines, have largely driven this growth. Imaging currently accounts for approximately 58% of revenue, and it will continue to represent the lion’s share of the projected 30% growth through 2007, according to Frost & Sullivan. But the real future of telemedicine lies in remote monitoring, says Shariq. It currently accounts for one-third of revenue, but it is a rapidly growing market that has the potential to explode, she adds.
Homecare is an unmistakable trend, says Shariq. It is fueled by an aging population that will overtax the healthcare system and a shift away from the tradition of adult children caring for their parents. The so-called “worried well,” which Shariq defines as prosperous 50 to 65 year olds who avidly consume homecare products, also will be fierce advocates of remote monitoring.
Reimbursement policies will play a predominant role in shaping this market. “Changes in the reimbursement structure will stimulate market penetration,” notes Shariq. The patients are onboard, but telemedicine proponents will have to convince legislators of the technology’s long-term cost benefits to effect meaningful change.
Shariq also mentioned some legal issues that will need to be resolved if the technology is to realize its full potential. Doctors who telecommute, for example, may be giving advice in a country where they do not have a valid medical licence. To underscore the possibilities and challenges that telemedicine and remote surgery open up, Shariq asks what is to “prevent a patient from using a doctor in Pakistan if the German physician is too expensive?” As a greater share of healthcare costs are passed along to patients, this will become a real issue.
Shariq paints perhaps too rosy a picture of the technology’s uptake. While telemedicine may well reduce healthcare costs in the long run, setting up the infrastructure will require substantial investment. Hard decisions will need to be made. I don’t know about you, but I hope that Missfelder and those of a like mind sit out this debate.
Norbert Sparrow
Copyright ©2003 European Medical Device Manufacturer
