8 Insights on “Prequalification” from Dr. Sigrid Bender
01: Dr. Sigrid Bender is responsible for Prequalification projects at Digital Oxygen. But what exactly is “prequalification” and why should medical device manufacturers care about it?
Dr. Sigrid Bender: At its core, prequalification is a standardized procedure that ensures the suitability of service providers in the field of medical device supply. Its purpose is to ensure the proper and professional practice of the profession and to ensure that providers meet the necessary legal requirements. Before a company can directly bill health insurance companies for sold medical devices, they have to provide a respective certificate.
02: What are the benefits of prequalification for MedTech companies?
Dr. Sigrid Bender: As mentioned, prequalification is a mandatory legal requirement for contracts with health insurance companies and to sell their products directly to patients. Service providers benefit from several effects: On one hand, they operate as independent players in the German healthcare system and have the opportunity to establish important relationships with decision-makers at health insurance companies. On the other hand, there are potentials for revenue and margin increases. Revenue increases arise mainly from access to new data: Since prequalified companies bill insurance companies directly, they also receive the prescriptions – and this data is helpful for target group-specific marketing and field service management. Margin improvements mainly arise because prequalified companies no longer have to go through distributors or wholesalers and can distribute medical devices directly to patients.
03: Do you actually see these theoretical advantages in practice? Which benefits have MedTech companies realized in practice through prequalification?
Dr. Sigrid Bender: Absolutely, yes. How prequalification impacts varies from case to case: Some companies, for example, were able to significantly improve their margins through prequalification, in one case a manufacturer was even able to double its revenue – among others by establishing an extensive B2C contact management.
04: What challenges do you see for companies in the prequalification process?
Dr. Sigrid Bender: The prequalification process is complex and bureaucratic. Companies must have a precise knowledge of the requirements and the necessary documentation – and of course, find a suitable certification body. As always, the devil is in the details: For many large corporations, for example, it is not trivial to assign their products to the right group of medical devices making it hard to meet the group-specific requirements.
05: How does Digital Oxygen support companies in the prequalification process?
Dr. Sigrid Bender: At Digital Oxygen, we accompany our clients from the initial consultation throughout the entire prequalification process, and also support the company-internal implementation. After the prequalification process, beyond mere certification, there is still a lot to consider – such as adjusting billing flows or new sales processes – simply to be able to leverage the benefits of your prequalification. Our team brings the necessary experience and expertise to support our clients throughout the process.
06: What is the regulatory base for prequalification and how has regulation developed in the past?
Dr. Sigrid Bender: In the past, compliance with the respective requirements was primarily assessed during the process of granting statutory health insurance approvals. Prequalification was made mandatory with the Act to Strengthen Healing and Medical Device Supply (Stärkung der Heil- und Hilfsmittelversorgung – HHVG) in April 2017. This law ensures that all service providers who wish to conclude a contract with a health insurance company under § 127 SGB V are prequalified. The numerous individual suitability checks before each contract have thus been eliminated, leading to a reduced workload for health insurance companies.
07: How do you see the future of prequalification in healthcare?
08: What advice would you give companies considering prequalification?
Dr. Sigrid Bender: Medical device manufacturers and MedTechs should inform themselves early about the process and requirements. If there is no internal expertise, external support is usually a worthwhile option. External prequalification experts have the necessary experience in the prequalification process and have already seen most of the mistakes and pitfalls.
You can find more information about prequalification here.