Healthcare Platform Operators: What Are the Pitfalls?
Advertising Law
Advertising for health services is subject to strict rules, in particular the German Law on the Advertising of Medicinal Products (HWG) and the general fair trade requirements set forth in Sections 3 and 5 of the German Unfair Competition Act (UWG). Platforms must ensure that they do not make misleading claims of healing, do not engage in impermissible success-based advertising, and transparently disclose specific risks.
Professional Ethics for Physicians
To the extent that physicians are involved in such business ventures, professional regulations must be observed. These regulations are derived from the professional codes of conduct of the state medical associations, which are largely based on the (Model) Professional Code of Conduct for Physicians (MBO-Ä).
For platform models, Section 31 of the MBO-Ä, among other provisions, must be taken into account; this section prohibits compensation or other benefits for the referral of patients or diagnostic materials, as well as for recommendations of specific providers of healthcare services. For example, a performance-based share of platform revenue for physicians may be classified as a prohibited referral in exchange for compensation.
Section 3(2) of the MBO-Ä must also be taken into account. According to this provision, the sale of goods and the provision of commercial services in connection with medical practice are prohibited unless they are an essential component of medical therapy. In the case of platform models that are regularly based on self-pay services, it is likely to be difficult in many cases to justify the necessity of the services offered as an essential component of medical therapy. The specific structure of the business model must therefore be carefully examined on a case-by-case basis to determine whether professional regulatory requirements are being met.
Pharmacies
If pharmacies are integrated into the respective business model, the prohibition on patient referrals under Section 11 of the Pharmacy Act (ApoG) must also be observed. This applies without exception, regardless of whether a prescription is transmitted as a paper printout, QR code, token, or via an app. The sole determining factor is that patients must be free to choose which pharmacy they use to fill their prescription.
In particular, new business models, telemedicine providers, and digital platforms are increasingly putting this freedom of choice to the test. Current case law makes it clear that even subtle forms of digital steering can constitute an impermissible referral of patients.
In contrast, case law has recognized that, in individual cases, the mere listing of two pharmacies may be sufficient to preserve the required freedom of choice, provided that patients are actually able to make a free and uninfluenced decision between the listed pharmacies.
Criminal Law
The corruption offenses under Sections 299a and 299b of the German Criminal Code (StGB) cover the improper granting and acceptance of benefits in the healthcare sector when healthcare professionals favor other providers in competition in return for such benefits. If remuneration is clearly paid for the referral of patients or samples, this may therefore be a criminal offense. Platform models in which physicians receive a percentage of revenue or profit based on the volume of orders therefore carry a risk of criminal liability.
Competition Law
Violations of medical professional ethics may also constitute unfair competition under Sections 3 and 3a of the German Unfair Competition Act (UWG) and may result in warnings from competitors or professional associations. Platform operators are not only liable for their own conduct but may also be held liable as participants (instigators or accomplices) if they encourage violations of medical professional ethics through the structure of their contracts or compensation models. For platforms, this means: Business models should be designed to protect medical independence, not include hidden referral commissions, and ensure transparency toward patients (e.g., through information sheets regarding any physician compensation).
Platform operators must take numerous legal requirements into account when implementing their business plans. In addition to issues regarding data sharing and the integration of payment systems, the following aspects in particular must be considered:
Advertising (no claims of a cure, no aggressive referral advertising), professional regulations (no referral fees, no financial incentives for specific providers), criminal law (avoidance of unlawful agreements within the meaning of Sections 299a, 299b of the German Criminal Code (StGB)), and competition law (compliance with professional codes of conduct as rules of market conduct and avoidance of the risk of cease-and-desist letters).
The legal assessment and structuring of the business model depend on a variety of individual factors. An early legal review is therefore recommended in order to identify potential legal risks as early as the conceptualization and implementation phases and to take appropriate measures to ensure legal compliance.