Over EUR 4 billion for the digitalisation of hospitals German Parliament passes Future of Hospitals Act (Krankenhauszukunftsgesetz–KHZG)


On 18 September 2020, the German Parliament (Bundestag) passed the Future of Hospitals Act. Based on this Act, the German government will make EUR 3 billion available for investments to be made in modern emergency capacities and to improve the digital infrastructure for hospitals. In addition to the financing share from the German government, the German states or the hospital owners must provide a 30% co-financing share for each publicly funded project. The plan is to make a total amount of EUR 4.3 billion available in this way. The German state-owned development bank KfW (which is short for Kreditanstalt für Wiederaufbau) will additionally provide loans to finance the co-financing shares to be borne by the hospitals.

I. Projects eligible for public funding

Pursuant to Section 19 of the German Hospital Structure Fund Ordinance (Krankenhausstrukturfonds-Verordnung), the projects eligible for public funding will include in future:

  • the technical equipment, in particular the information technology, for emergency wards in hospitals;
  • patient portals for digital admission to and discharge from hospitals (digital arrangement of appointments, exchange of information with upstream service providers, digital anamnesis or information of patients, post-discharge treatment);
  • electronic documentation of the nursing care and treatments provided, including systems supporting speech-based documentation;
  • partially or fully automated clinical decision support systems, which are intended to be expanded in the future to include AI-based services;
  • digital medication management.

The implementation of individual sub-processes, such as automated interaction checks, is also eligible for public funding:

  • setting up internal digital processes at hospitals for requesting services;
  • developing general IT structures that are shared among facilities and hospital owners to enhance regional health care structures;
  • establishing online-based availability documentation systems for beds to improve the cooperation between hospitals and other health care providers;
  • setting up telemedicine networks among hospitals, as well as between hospitals and out-patient health care facilities;
  • implementing measures to guarantee IT and/or cyber security;
  • converting patient rooms so that they meet the special treatment requirements in case of an epidemic.

Only projects that apply internationally accepted standards for the interoperability of digital services are eligible for public funding. The requirements stipulated in Section 291d of Book V of the German Social Code (SGB V) for the integration of open and standardised interfaces need to be taken into account. Any documents and data that are relevant to patients must be able to be transferred to and included in the electronic patient file. Information security and compliance with data protection law must be guaranteed.

Cross-border projects are also eligible for public funding.

If hospital owners take out a loan for the implementation of a project that is eligible for public funding, public funds may also be granted to finance the interest, the repayment and the administrative costs of such loan.

II. Future of Hospitals Fund and application

The German Federal Office for Social Security (Bundesamt für soziale Sicherung) will set up a Future of Hospitals Fund in the aggregate amount of EUR 3 billion. The regulations will be based on the existing regulations for the Hospital Structure Fund. The funds will be distributed among the German states using a specific formula known as the “Königstein” formula (Königsteiner Schlüssel).

The hospital owners must notify the German states of their public funding requirements using the nation-wide standard forms made available by the German Federal Office for Social Security (requirements notification). Within three months of the receipt of the requirements notifications, the German states will then select the projects for which public funding will be applied for. The applying state, the hospital owner or both together must bear at least 30% of the total funding.

The details regarding the requirements for the receipt of public funding and the procedure for the allocation of the public funds, the documentation of the public funds granted and proof that they have been used for the intended purpose will be defined in an ordinance issued by the German Federal Ministry of Health (Bundesministerium für Gesundheit). The German Federal Office for Social Security will examine the applications and allocate the funds.

The German Future of Hospitals Act will boost digitalisation in the German hospital sector.

Cornelia Yzer

Cornelia Yzer
Of Counsel
+49 30 52133 21148