Category a result, estimates of the efficacy or even

Category I: Medical aids (e.g. wheelchairs and incontinence products):- In all three countries, relatively strict reimbursement levels have been set for outpatient care. In general, these levels do not apply to a particular product, but to a category of products. The mechanisms for setting reimbursement levels vary between the three countries. In France, and for some categories in Germany, reference prices are used to cap the amount that may be reimbursed from public sources. It is important to note that these reference prices are not necessarily identical to the actual selling prices. If the selling price of a device exceeds the reimbursement cap, patients must pay the difference. Reimbursement levels for categories that are not subject to reference pricing in Germany are derived from competitive bidding. Even for medical aids with a reference price, competitive bidding is an opportunity. Nevertheless, these

Tenders have been implemented very rarely so far.

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Category II: Implants and other artificial body parts (e.g. total joint replacements, implantable defibrillators, and stents): – In the majority of cases, this category is associated with inpatient care. Similar to Medicare and other large insurance providers, most reimbursement systems for inpatient care in Europe are based on case fees. France and Germany use diagnosis-related groups (DRGs) to determine these fees, whereas the UK uses DRG-like health-care resource groups (HRGs).

Category III: Technical equipment for professionals (e.g. diagnostic imaging devices, therapeutic devices such as equipment for laparoscopic surgery): – case fees are in general meant to include running costs. In Germany, as in other countries, disposable or reusable devices as well as costs associated with using the technical equipment are included in the applicable DRG, whereas long-life equipment that can be viewed as a capital investment is not reimbursed by SHI. These investments are funded by the federal states.

Innovative medical devices are usually evaluated in relatively small clinical trials and have thus not been tested in large numbers of patients. As a result, estimates of the efficacy or even cost-effectiveness of innovative technologies are often still vague at the point when decisions on coverage are being made. Moreover, the use of innovative technologies can lead to higher costs for providers long before DRGs or other reimbursement mechanisms have been adapted to the new technologies. Clearly, this can slow down the process of adopting innovations. By the same token, creating economic incentives for healthcare providers to use these innovative technologies can lead to a sharp rise in expenditures, thus taking resources from other parts of the healthcare system where they might have led to greater benefits. This is a dilemma faced by every healthcare system.

Today most European countries have developed standardized approaches to deal with new technologies in a balanced way. DRG systems pay additional reimbursement components (e.g. for wage differences, teaching status, or the use of new technologies or drugs), which account for a substantial share of the overall inpatient expenditure (i.e. up to 30%). After a new medical device is launched, it is often covered by additional reimbursement components at first and, if sufficient evidence for effectiveness is provided (e.g. Germany), later incorporated as a separate DRG into the DRG systems. This approach facilitates, but does not force, the adoption of innovative medical devices. Moreover, although price decreases under this approach may occur more slowly, expenditures tend to be more predictable and controllable.