Hospital Care Improvement Act

The Hospital Care Improvement Act, known in Germany as the Krankenhausversorgungsverbesserungsgesetz (KHVVG), represents a major hospital reform initiative designed to modernize the structure, financing, and quality standards of inpatient healthcare. The Act seeks to address long-standing inefficiencies in Germany’s hospital system by redefining levels of care, reorganizing service groups, and improving the allocation of resources across regional and specialized medical facilities. The KHVVG emerged in response to economic pressures, staffing shortages, and disparities in access to quality care, aiming to strike a balance between financial sustainability and patient-centered outcomes. It serves as both a structural and financial reform, shifting the focus from volume-based incentives toward value and quality in hospital care.

One of the most transformative aspects of the Hospital Care Improvement Act is its adjustment to the traditional payment model based on Diagnosis Related Groups (DRG). The Act introduces the substitution of DRG reimbursements with partially flat fees and new quality-linked remuneration mechanisms that reward hospitals for providing appropriate and efficient services rather than maximizing treatment numbers. This transition is intended to stabilize the cost of care while reducing the economic strain on hospitals and public insurers. It further supports fairer compensation structures aligned with defined levels of care, ensuring that specialized facilities receive adequate funding for complex cases while community hospitals can sustain essential services.

Central to the KHVVG is a new model for hospital planning and remuneration, which integrates performance metrics, service quality, and medical necessity. By categorizing hospitals according to service groups — from basic care providers to highly specialized centers — the reform promotes transparency, efficiency, and more equitable distribution of medical capabilities across Germany. This structured approach enables policymakers to guide investment and staffing more effectively, aligning healthcare delivery with population needs and medical expertise rather than financial incentives alone. Patients benefit through clearer care pathways and improved coordination across different levels of the healthcare system.

Beyond administrative and financial modernization, the Hospital Care Improvement Act intersects with the digital transformation of healthcare, particularly in areas such as data management, patient identification, and secure information exchange. As hospitals transition to new reporting and reimbursement models, reliable data integrity and interoperability become critical. Healthcare identity security companies play a crucial role in this process, ensuring clinicians can access and share sensitive patient data quickly and securely while adhering to strict regulatory and privacy requirements. These technologies help reduce administrative burdens and enhance clinical efficiency in line with the KHVVG’s broader goals.

Imprivata supports the intent of the Krankenhausversorgungsverbesserungsgesetz by enabling secure, streamlined access to digital health systems and patient data. Through solutions such as Imprivata Enterprise Access Management and digital identity verification tools, clinicians can authenticate rapidly and safely at the point of care, ensuring both data protection and clinical efficiency. As Germany’s healthcare system evolves under this landmark hospital reform, solutions like those from Imprivata help hospitals align compliance, operational security, and patient trust — cornerstones of a sustainable, technology-driven care environment.