The new German government has thrown the private healthcare industry into disarray with a draft law that would insure that the medical profession had to have a majority stake in all new Medizinisches Versorgungszentrum (MVZs) or medical care centres. This would stop dead lab consolidation and threaten the plans of larger hospital chains to use MVZs to enter the outpatient market.
Since 2004 some 1,206 medical care centers, with 5,536 active doctors, have been created. But the use of MVZs as a vehicle to industrialise German outpatient medicine has alarmed the medical profession. In Munich, for instance, over 300 doctors have joined a new network to stop Polikom, a big Berlin clinic chain. from opening a massive MVZ in the city centre.
The new law came out of the pact between the free market Free Democrats and the Christian Democrats and could be passed by late spring 2010.
Observers say the impact would be to freeze
mergers and acquisitions for 3-4 years. One source said: “Prices would plummet as it
would be impossible to gain control and so nothing would happen for a
long time as doctors digested the fact that th
e rule destroys the value of their businesses.”
Equally, the threat of the new law is likely to act as a spurt for all acquisition in the next six months.
But many feel that it is most unlikely to actually pass into legislation in its entirety, thanks to the European Union.
Marcel Hardens, the head of sales and marketing at Pan-European lab group Labco says: "The European Commission explicitly told the Belgians that diagnostic labs were not 'healthcare' but were more 'services' and this led the Belgians to abolish restrictive laws. In a case which will be held in 2010, the European Commission is taking the French government to the European Court of Justice to uphold this principle in laboratories."
He suggests that this means that the new German law could not be applied - at least to MVZs who are labs.
Last May the ECJ ruled in favour of legislation in France, Germany, Italy which
restricted ownership of pharmacies to pharmacists. Whilst ruling that
the laws did "constitute a restriction on the freedom of establishment
and the free movement of capital" the ECJ decided that "that
restriction can nevertheless be justified by the objective of ensuring
that the provision of medicinal products to the public is reliable and
of good quality. In this context, the Court draws attention to the very
particular nature of medicinal products, whose therapeutic effects
distinguish them substantially from other goods."
Hardens argues that this does not apply to labs as they have been defined by the European Commission as services and thus not part of the healthcare area where member states still exercise autonomy.
