Medical Devices Reimbursement Market Size, Share & Trends Report

Medical Devices Reimbursement Market Size, Share & Trends Analysis Report By Payer (Public, Private), By Healthcare Setting (Hospitals, Outpatient Facilities), By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: Mar, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-4-68038-835-0
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 82

Report Overview

The global medical devices reimbursement market size was valued at USD 374.4 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 10.8% from 2021 to 2028. Medical devices reimbursement is defined as 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. The reimbursement amount is decided by two methods; complete reimbursement of specific medical devices, and payment by the result of the entire medical procedure where a medical device is used.

U.S. medical devices reimbursement market size, by payer, 2016 - 2028 (USD Billion)

The U.S. Affordable Care Act focuses on decreasing costs of healthcare for patients. The main purpose of this act is to reduce the medical device cost 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 for healthcare reimbursement in 2019 within the US. Due to this reason, the market is expected to show 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.

COVID-19 has had a significant effect on medical devices and its supply chain market. Movement restriction between countries interrupted transportation services between regional warehouses. Many medical device companies rely on healthcare facilities for clinical trial data collection, as most medical devices undergo trials before manufacturers can obtain certificates for market approval. As there is a restriction on ambulatory visits, under which these research studies typically fall, the launch of new medical devices by manufacturers is likely to be hindered.

However, COVID-19 has also led to an increase in demand for home care services and products, which is estimated to positively impact the reimbursement coverage of remote monitoring devices, wearable devices, home infusion devices, durable medical devices, and others. For instance, ALS Association, National Association for Home Care and Hospice, Massachusetts General Hospital, and Partners Healthcare System have requested CMS to issue an 1135 blanket waiver, allowing coverage for all home infusion therapies during the COVID-19 public emergency.

Payer Insights

The private medical devices reimbursement segment accounted for the largest revenue share of 65.1% in 2020. 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 continue its dominance over the forecast period. Additionally, the rising prevalence of cancer and diabetes and increasing demand for better treatment are also responsible for segment growth over the forecast period. Also, the current assessment criteria for reimbursement reflect the cost of using a device or performing a procedure, but not the value of the technology used. Thus, owing to a lower average reimbursement value, various public healthcare settings do not have advanced technology medical devices at their disposal.

The growing adoption of public payers in emerging and developed markets and rising innovation for the development of new medical devices are among the major factors contributing to the growth of the public medical device reimbursement segment. In 2017, NHS treated over 8.5 million non-urgent patients and around 135,000 people received long-term treatment under NHS. Hence, with an increase in the aging population and a rise in the prevalence of chronic diseases, the market is expected to grow over the forecast period.

Healthcare Setting Insights

The hospital segment dominated the market and accounted for the largest revenue share of 53.4% in 2020. The segment is anticipated to maintain its dominance over the forecast period. Moreover, the growing aging population and increasing prevalence of chronic diseases are further driving the segment. 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. 

Global medical devices reimbursement market share, by healthcare setting, 2020 (%)

The outpatient facilities segment is anticipated to witness the highest CAGR of 11.4% over the forecast period due to 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.

Regional Insights

North America dominated the medical devices reimbursement market and accounted for the largest revenue share of 50.0% in 2020 and is expected to lead throughout the forecast period. Increasing cases of various deadly diseases are predicted to stimulate the market over the forecast period. Furthermore, the reimbursement framework is the most advanced within the region compared to other regions. A biannual revision of the list of devices is performed by committees to incorporate the latest products within the reimbursement system.

Changes in the regulatory scenarios and increasing pressure on the healthcare industry to decrease service costs are likely to increase the demand for medical device reimbursement. Hence, the market is expected to show growth over the forecast period. An increasing number of healthcare centers and rising demand for medical devices are expected to drive the market in Europe. However, 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.

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 the 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 the 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, manufacturing capacities, and provide competitive differentiation. Some of the prominent players in the medical devices reimbursement market include:

  • Aviva

  • Nippon Life Insurance

  • CVS Health

  • WellCare Health Plans

  • BNP Paribas

  • Aetna

  • Allianz

  • Humana

  • Cigna

  • UnitedHealth Group

Medical Devices Reimbursement Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 434.4 billion

Revenue forecast in 2028

USD 892.4 billion

Growth Rate

CAGR of 10.8% from 2021 to 2028

Base year for estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Payer, healthcare setting, region

Regional scope

North America; Europe; Asia Pacific; Latin America; MEA

Country scope

U.S.; Canada; U.K.; Germany; France; Italy; Spain; China; India; Japan; Australia; South Korea; Brazil; Mexico; Argentina; Columbia; South Africa; Kuwait; UAE

Key companies profiled

Aviva; Nippon Life Insurance; CVS Health; WellCare Health Plans; BNP Paribas; Aetna; Allianz; Humana; Cigna; UnitedHealth Group

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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 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global medical devices reimbursement market report on the basis of the payer, healthcare setting, and region:

  • Payer Outlook (Revenue, USD Billion, 2016 - 2028)

    • Public

    • Private

  • Healthcare Setting Outlook (Revenue, USD Billion, 2016 - 2028)

    • Hospitals

    • Outpatient Facilities

    • Others

  • Regional Outlook (Revenue, USD Billion, 2016 - 2028)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

      • France

      • Italy

      • Spain

    • Asia Pacific

      • China

      • India

      • Japan

      • South Korea

      • Australia

    • Latin America

      • Brazil

      • Mexico

      • Argentina

      • Colombia

    • Middle East & Africa

      • South Africa

      • Kuwait

      • UAE

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