Today the market
The health sector is a large market with a 10% share of the European gross domestic product, and it is growing. Factors for steady market growth include demographic change (aging population), the increase in chronic diseases and medical progress providing new diagnostic possibilities.
According to current studies, the German hospital sector faces the following challenge:
"The clinics should guarantee nationwide coverage. Although hospital cases have risen by 1.6 percent annually since 2005, the length of stay has declined from 8.5 to 7.6 days in 2012. The bottom line represents a decline of 346,000 occupancy days in 2012 compared to 2005. Nevertheless, the hospital utilization increased in the same period from 76.7 to 80.7 percent, which can be accounted for by the cutback in hospital beds. "(* 1)
In the hospital market, the following picture emerges: The market currently is comprised of approximately 2,000 clinics. These clinics are divided into almost three equal portions: Approximately 35% of hospitals are private hospitals, another 35% are non-profit hospitals. The remaining 30% are public hospitals. This shows an almost uniform distribution in the ownership. The proportion of hospitals in private ownership has more than doubled since 1991 from 14.8% to 35%. On the other hand, during the same period, the number of hospitals reduced in public ownership from 46% to 29.9%. The share of non-profit hospitals stagnated, having stood at 39.1% in 1991 and just under 35% nowadays. Looking at the development of hospitals over the last 25 years, we can highlight a significant 17% decrease.
"The economic situation of hospitals in Germany has intensified significantly in 2012. Only 43% of all general hospitals generated an annual profit (2011: 55%). Only 7% reached a break even (2011: 14%). Every second hospital (51%) wrote losses (2011: 31%). The difficult economic and financial situation for hospitals is associated with an enormous need for investment. The investment backlog has grown steadily in recent years. States could not sufficiently fulfill their legal obligations while attempting to keep up with necessary investments to fund maintenance measures. At the same time, medical and technological advancements demand higher standards and necessary modernization investments. The Rhine-Westphalia Institute for economic research (RWI) estimates the investment gap in German hospitals to be around € 34 billion. " (* 2)
GBM takes action and accesses the market in this field. Projects in the sector will be presented soon.
