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How to enter the German Health IT market? (Part 2)

 

Which Chances Are Seen In mHealth And Fitness & Wellness Apps?

 

Opportunities in the German Health IT Market: the E-Health Act 2016, the Germany Way of Patient Engagement, the Innovation Fund and Digital Health Market Segmentation, illustrated in slides.

Second Part

Which Chances Are Seen In mHealth And Fitness & Wellness Apps?

mHealth in one future topic talked about quite a lot. As well as Digital Health, E Health, health apps and wearables. But what is meant by that?

 

What Is mHealth Actually?

Mobile health or mHealth is often associated with apps for mobile phones, smartwatches and tablet computer within the fitness and wellness area. Mobile Health is part of Digital Health. Recently I came across a nice graphic visualizing the keywords and their fields of definition (link). While digital health means the whole area about computer technology used in all areas of health, mobile health / mhealth is used whenever portable electronical devices, which often easily fit in a pocket, are involved. This often refers to apps on smartphones and so on, but also to wearables, technical sensors directly worn at the body, measuring specific parameters like activity, step count, heart beats, blood sugar and whatsoever.

Very popular are those apps and fitness trackers in private use. But there is also a wide field of professional use. Remote treatment, documentation, patient scheduling or rosters are some of multiple areas of implementations. Recently I have read an article which overstated a bit by saying, wearables already exist since the 15th century (link). There were talking about the first pocket watches and abacuses. However, in a narrower sense, mHealth refers to applications / software on mobile devices.

 

What Is Going On In mHealth?

According to a study from Research2guidenace (link), there are 259,000 mHealth apps from 58,000 publishers out there in the major app stores. Therefore, the global market is very dense. The download rates are estimated to grow at only 7% in 2016, to 3.2 bn. downloads and about 20% of Health App providers make more than 100.000 US$ per year with their apps. However, these are global numbers.

The willingness to pay out-of-the own pocket for health is very different between the nations. People in nations without a compulsory health insurance (SHI) system or a reliable tax-covered healthcare system are more likely to invest in their own health, if affordable. Germany has a compulsory SHI system, costing 4050 Euro per capita, thereof 533 Euro (13%) (link) are payed from private budgets. Healthcare providers and patients are very likely to await the SHIs to reimburse them for their healthcare expenses.

That does not actually count for the fitness and wellness area, but the mobile apps here are various. In summer 2015, nearly every third German has had a health app installed at his smart phone, regarding a Bertelsman survey (link). Regarding Bitcom, 44Mio Germans were using a smartphone (67% >14Jahre in 2015) (link). New approaches here only make sense if they offer a really good solution to an actual problem, if they have a really good, viral marketing approach and if they have APIs to / or are in combination with really fancy wearables or services. To put it in a nutshell, they need market power and must be outstanding.

 

Who Are Perspective Project Partners?

mHealth applications are often developed by start-ups or spin-offs. Start-ups have the ideas and the flexibility to create innovations. Start-ups do not have market power and wide-spread market communication channels. They also do not often have rich experience in management and market strategy or big funding to finance successful launches.

Therefore, Germany is establishing incubators and accelerators to help good ideas growing. Also the numbers of pitches, investors and venture capitalists are growing. The most dynamic places here are probably Berlin, Hamburg and Munich. But also rural areas might be interested in innovations, jobs and improved healthcare supply and therefore might be helpful with funding and advice. Some of the big players and health insurers are offering their support. The Health start-up eco-systems are growing (link). Just to name some bigger players: Grand4Apps (Bayer), Merck Accelerator (Merck) or DocChek support new ideas. FlyingHealth, XLHealth, Peppermint VenturePartners or Digital Health Ventures are some venture capitalists, financing good mhealth ideas.

Also partnering with the big health insurers can lead to success: The Techniker Krankenkasse (one of the 2 biggest SHIs) or AXA (one of the five biggest PHIs) has been recently in the news for their mhealth engagements. Also other health insurance companies offer mHealth applications or are interested in supporting mobile health services. Also healthcare providers are interested in mhealth for different reasons. Berlin's university hospital, the Charité, offers their kidney transplantation patients an app to improve their treatment (link). But mhealth is not only interesting for fitness or patient treatment, also to organize care, appointments or rosters, mobile devices are the cutting edge.

 

Which Advices has GTMHC To Newcomers?

First of all: Learn how the market works! Do market research, surveys and ask market insiders for advice. Deep market knowledge about market players, competitors, benefiters and financing are key to enter any market. Whoever is your target group, ensure you speak the right language. It is not enough to translate your app and manual into German - which is necessary. Your users are most likely not to be fluent in English. Professional English language skills and IT knowledge is not required to become a patient, a nurse or a physician. Moreover, Germany has strict requirements regarding data privacy, IT and data security as well as strict medical devices regulations. Please ask an expert regarding required regulations for your mhealth application.

Healthcare is not as fast in digitalization as other areas. The way might be not even, the ideas not perfectly realized, but there is potential and the potential will grow.

Glossary:

  • mHealth - mobile healthcare applications. MHealth can be differentiated into mobile health applications for private use, often in areas of Fitness, wellness or private healthcare, or for professional use, which often means, healthcare data become mobile available to medical staff.
  • wearables - technical sensors directly worn at the body, measuring specific parameters (e.g. activity, step count, heart beat rate, respiration rate, even blood sugar etc.) such as fitness wristbands, patches, special cloth or insoles etc. Health tracking wearables are medical devices.
  • SHI - Statutory Health Insurance. The mandatory health insurance to German employees, covering 90% of German inhabitants. Only self-employed, people with high-incomes and civil servants have the choice to leave the SHI-system. The number of SHIs decrease. Currently there are 118 SHIs in Germany. Ongoing competition and consolidation: Most SHIs are keen to become attractive to young and healthy insurant with good income).
  • PHI - Private Health Insurance. 10% of German inhabitants are not in the SHI-System but reimburse their health expanses from PHIs. About 30% of German inhabitants covers their out-of-pocket payments with additional PHIs. There are 45 PHIs in Germany.

 

Coming soon:

Part three: What means Patient Engagement in Germany?

This is the second part of a series of four articles. Please follow us or subscribe to our GTMHC German Market Newsletter in English (Diese E-Mail-Adresse ist vor Spambots geschützt! Zur Anzeige muss JavaScript eingeschaltet sein!) Next article to be published in December 2016.

Read the first article "Which Opportunities has been offered to Health IT Companies by the E Health Act 2016?" here

GTMHC is publishing Market Reports to institutions and companies. If you would like to learn more about the German Healthcare Market or the German Silverager Economy, preorder our next two market reports. Further Information and preorders here: GTMHC Market Reports

 

We are going to release two new Market Reports before the end of this year:

  • The GTMHC Generation 50plus Market Report (in German and English)
  • The GTMHC German Health IT Market Report 2017 (in English)

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Go-To-Market in Health Care bedeutet strategische und operative Beratung von Unternehmen aus dem Bereich HealthCare (IT und Medizintechnik), die einen neuen, regionalen Markt für sich erschließen wollen. Die Berater der GTMHC verfügen über „Stallgeruch“ – sie haben alle langjährige Erfahrung in der Geschäftsführung und/oder dem Vertrieb im Bereich Informationstechnologie und Medizintechnik.

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