The global Medical Devices Reimbursement market size was estimated at USD 434.6 billion in 2021 and is expected to surpass around USD 1028.4 billion by 2030 and poised to grow at a compound annual growth rate (CAGR) of 9.6% during the forecast period 2022 to 2030.
Key Takeaways:
- By Payer, the U.S. Medical Devices Reimbursement market was valued at USD 203.6 Billion in 2021 and expected to witness growth at a CAGR of 9.6% from 2022 to 2030.
- The private payer segment dominated the market with a revenue share of over 65.0% in 2021 due to the presence of a large number of private players
- By healthcare setting, the hospitals segment held the largest revenue share of over 50.0% in 2021 due to recent technological developments and high patient footfall requiring the use of healthcare instruments
- Asia Pacific is projected to witness rapid growth during the forecast period owing to the rising penetration of insurance services in rural and urban areas
Medical devices reimbursement is defined as the payment a private insurer pays to healthcare providers for costs the provider incurred while using medical devices. Usually, the health insurer or government payers cover the patients’ healthcare expenses inclusive of medical device use. Technological advancements in Electronic Medical Records (EMR), rising cases of chronic diseases, and the growing need for reimbursement are certain factors driving the market. During the COVID-19 pandemic, the demand for remote monitoring had increased and now various public organizations like Medicare are providing reimbursement for remote monitoring.
Remote monitoring has gained significant importance in treating patients with chronic diseases. The high burden of chronic diseases is expected to improve the demand for remote monitoring in the coming years and this is anticipated to have a positive impact on market growth.
The U.S. Affordable Care Act focuses on decreasing the costs of healthcare for patients. The main purpose of this act is to reduce medical device costs and make affordable healthcare insurance available to every person in the country. In addition, the Center for Medicaid and Medicare is working towards providing high-quality medical devices and making health insurance available for billions of people. Hence, Medicaid spending in the U.S. increased by 4.5% in 2019. Also, according to a report published by the Center for American Progress (CAP), around USD 1.3 trillion is estimated to have been spent on healthcare reimbursement in 2019 in the US. Due to this reason, the market is expected to witness lucrative growth over the forecast period.
Furthermore, with an increasingly aging population, healthcare expenditures will continue to increase, leading to high demand for medical devices. This is another factor that will highly impact the reimbursement industry in the long run. Other factors responsible for the growth of the market are the increasing cost of healthcare, the growing patient population, and rising awareness among people regarding health insurance policies.
The governments of various countries are providing an add-on reimbursement for medical devices post-COVID-19 pandemic. For instance, in May 2022, the French National Authority for Health provided certain recommendations for adding reimbursement on medical devices such as diagnostic imaging devices, cardiovascular and peripheral vascular devices, and interventional radiology devices. Such actions by the government are expected to support the growth of the market in the coming years.
Report Scope of the Medical Devices Reimbursement Market
Payer Insights
The private segment accounted for the largest revenue share of over 65.2% in 2021. The growth of the segment is attributed to the presence of a large number of private players in the market. The segment is expected to maintain its dominance over the forecast period. Additionally, the rising prevalence of cancer and diabetes and increasing demand for better treatment are responsible for segment growth over the forecast period. Private players reimburse a medical device that has been approved by the FDA. Also, with the increasing prevalence of respiratory diseases, demand for expensive medical devices, such as ventilators, is increasing. Therefore, the demand for private payer services is expected to grow over the forecast period.
The public segment is expected to expand at a CAGR of 8.4% over the forecast period. Public payers provide end-to-end solutions to companies in the pharmaceutical and healthcare industries. Consequently, the demand for public payers is increasing due to the growing need for cost-effective operations and the rising prevalence of chronic diseases globally. An increase in the adoption of public payer services in emerging and developed markets and the introduction of advanced medical devices along with reimbursement facilities are among the major factors contributing to the segment growth.
Healthcare Setting Insights
The hospitals segment dominated the market and accounted for a revenue share of over 50.1% in 2021. The growing prevalence of chronic diseases is driving the demand for medical device reimbursement in large-scale settings such as hospitals. Many research-based innovative medical devices are initially used in public hospitals before they are sold to private hospitals. The private healthcare settings maintain a purchasing budget, which includes surplus revenue being extracted from patients directly. Hence, they are more equipped with state-of-the-art medical devices.
The outpatient facilities segment is anticipated to register the highest CAGR of 9.9% over the forecast period due to the increasing investments in R&D and the growing incidence of chronic diseases. Moreover, the growing need for medicines and their cost-efficient production is anticipated to further drive the segment. In addition, these standalone practices provide special health packages (inclusive of various services, such as preventive assessment, customized travel care, and genetic testing) for corporate firms and their employees, thus boosting segment growth.
Regional Insights
North America accounted for the largest revenue share of over 50.6% in 2021 owing to favorable regulatory policies and robust reimbursement structure. Provisions for medical device reimbursement are also well-established in the region. The rising prevalence of chronic diseases, coupled with the increasing demand for medical devices, is expected to augment market growth in this region over the forecast period.
Asia Pacific is likely to witness significant growth over the forecast period due to rising healthcare expenditure, increasing chronic disease prevalence, and rising demand for resources in developing countries like China, Japan, South Korea, and India. These countries are adopting the policies being followed by the U.S. and European countries in order to streamline and develop a highly efficient healthcare management system, which is likely to have a positive impact on the market growth.
Key Companies & Market Share Insights
Key companies are focusing on research and development to introduce technologically advanced products and gain a competitive edge. Growth in medical device reimbursement will, in turn, propel technological advancements by medical device manufacturers. This will allow for better healthcare outcomes and higher cost efficiency in the long run. Furthermore, the medical device players are investing in consulting towards the preparation of apt reimbursement proposals for regulatory authorities to increase their profit margins. This trend is expected to rise owing to reimbursement being the biggest challenge for medical device manufacturers to secure coverage and attract risk-averse investors.
In North America, the most prominent region for this market, since the implementation of the Affordable Care Act, the healthcare industry has transformed from a volume-based to value-based care model, thus driving the need for reimbursement consulting. Key companies are also engaging in partnerships, mergers, and acquisitions to strengthen their product portfolio, expand manufacturing capacities, and provide competitive differentiation. Some prominent players in the global medical devices reimbursement market include:
- Aviva
- Nippon Life Insurance
- CVS Health
- WellCare Health Plans, Inc.
- BNP Paribas
- Allianz
- Humana Inc.
- Cigna
- UnitedHealth Group
- Anthem Insurance Companies, Inc.
Segments Covered in the Report
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Nova one advisor, Inc. has segmented the global Medical Devices Reimbursement market
- Payer
- Healthcare Setting
- Hospitals
- Outpatient Facilities
- Others
By Geography
North America
Europe
- Germany
- France
- United Kingdom
- Rest of Europe
Asia Pacific
- China
- Japan
- India
- Southeast Asia
- Rest of Asia Pacific
Latin America
- Brazil
- Rest of Latin America
Middle East & Africa (MEA)
- GCC
- North Africa
- South Africa
- Rest of Middle East & Africa
Key Points Covered in Medical Devices Reimbursement Market Study:
- Growth of Medical Devices Reimbursement in 2022
- Market Estimates and Forecasts (2017-2030)
- Brand Share and Market Share Analysis
- Key Drivers and Restraints Shaping Market Growth
- Segment-wise, Country-wise, and Region-wise Analysis
- Competition Mapping and Benchmarking
- Recommendation on Key Winning Strategies
- COVID-19 Impact on Demand for Medical Devices Reimbursement and How to Navigate
- Key Product Innovations and Regulatory Climate
- Medical Devices Reimbursement Consumption Analysis
- Medical Devices Reimbursement Production Analysis
- Medical Devices Reimbursement and Management
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