HBI Deals+Insights / Interviews

How digital tools are transforming rehabilitation — Interview with Philipp Schulte-Noelle, CEO, MEDIAN Group

Investment in digital mental health hit $2.7 billion in 2024, up 38% from the previous year, signalling a move from traditional providers to AI-led and hybrid care platforms. This surge reflects more than investor enthusiasm: growing societal acceptance, stronger institutional backing, and post-pandemic burnout have made digital mental wellness a priority for employers and insurers alike.

MEDIAN Group, pan-European provider of mental health, specialist care and rehabilitation services, comprising Priory in the UK, MEDIAN in Germany and Hestia Health in Spain, is using tools such as virtual reality, neurostimulation and AI-enabled voice biomarkers in its clinical work. Its Berlin-based lab tests new approaches and shares findings across its European network.

In a conversation with HBI, the CEO of MEDIAN Group, Philipp Schulte-Noelle, talks about rehabilitation in Germany and Europe, the role of digital and AI in mental health, and investor interest in the sector.

HBI: How has 2025 been for the MEDIAN Group so far, and what lies ahead?

Philipp Schulte-Noelle: It has been a strong year. We are growing above our expectations, which is encouraging, and we anticipate healthy growth in the coming years.

 Of course, it’s important to distinguish between our various business lines. In the UK, for example, we are still awaiting clarity on the NHS side, and some referral patterns are shifting, which poses challenges. But once the system settles, I believe high-quality independent providers will continue to play a key role alongside the NHS.

HBI: How does rehabilitation differ across Europe in terms of methodology?

Schulte-Noelle: When we talk about rehabilitation services in Germany, it’s much broader than just mental health services. In the UK, the term ‘rehab’ tends to imply addiction services. Across Europe, however, rehabilitation refers to a much broader spectrum of services, such as rehabilitation after a heart attack or rehabilitation when suffering from chronic back pain.

HBI: How does personalisation fit into rehabilitation treatment today? 

Schulte-Noelle: Many patients arriving at hospitals are not accurately diagnosed. Any tool that helps improve diagnostic accuracy is valuable, especially as patients increasingly present with multiple conditions and comorbidities. Capacity is limited across the sector, so technologies that can support to identify an accurate and comprehensive diagnosis as early as possible are essential. They make treatment more focused on the individual and support sustainable recovery. Personalisation also means matching the right treatment to each individual. In the past, medication was often prescribed in a standardised way. Broad-spectrum antidepressants, for example, might reduce symptoms without addressing root causes. Tools that allow us to move from uniform to personalised care, and from episodic to continuous support, are crucial.

Our international network allows us to test new treatment methods. We are currently trialling virtual reality (VR), in addiction, anxiety and neurological rehabilitation. At MEDIAN in Germany, VR is used across several conditions, while at Priory in the UK it is mostly applied to addiction treatment.

VR therapy recreates environments linked to a patient’s fears or challenges. Someone with a spider phobia, for example, would not face a real spider but work through gradual exposure in a controlled VR setting. This method, known as exposure therapy, helps patients build coping skills and reduce anxiety over time.

Biofeedback that is gathered during the VR exposure therapy also produces measurable data, giving clinicians real-time insight into behaviour. The environment can be adjusted as needed, ensuring that interventions are evidence-based and effective. After a thorough introduction, patients can practise independently, which improves engagement and efficiency.

The model is scaleable and adaptable, regardless of location. AI voice biomarkers are also highly relevant across many healthcare industries, and particularly within our field.

HBI: When it comes to digital tools such as VR, AI voice biomarkers and other tools, where do you see the most growth?

Schulte-Noelle: Growth is happening across all of them. One major area is digital aftercare, which follows inpatient rehabilitation. This is already common in Germany and is expanding, especially in psychosomatic care, where patients value ongoing support after they return home.

We operate a digital aftercare centre in Düsseldorf with 71 therapists, physiotherapists and other professionals who stay in touch with patients after discharge. It functions much like a digital clinic and represents a key growth area for the future.

Virtual reality continues to grow as well, particularly for new types of addiction treatment, including social media and behavioural addictions, and potentially even AI-related addiction. VR allows us to build immersive three-dimensional environments that make therapy more engaging and effective.

 HBI: How do you define value when using these tools?

Schulte-Noelle: Value can take several forms. One way is through the development of intellectual property and digital assets that can be scaled and applied in other markets or medical areas. For example, the MEDIAN Group Lab in Berlin develops new technology that can be applied across countries. One joint venture focuses on detecting levels of depression using voice biomarkers. Traditionally, depression was diagnosed through a psychiatrist’s assessment or questionnaires. Our AI voice biomarker analyses speech patterns, tone, and response speed to indicate a patient’s position on the depression scale. This provides a more objective and reliable measure, which we see as a significant breakthrough. Another is through outcome-based measurements that demonstrate results for payers, self-paying patients, commissioners and private medical insurers.

HBI: Could you share an example of a measurable outcome?

Schulte-Noelle: In Germany, we are the first and only provider of rehabilitation services to receive a permanent licence to operate as a digital aftercare provider for somatic indications. Our platform, MyMEDIAN@Home, allows every patient attending our clinic to download the app. They train both during their inpatient stay and, more importantly, for up to 12 months afterwards at home with a digital avatar. This supports long-term treatment and reduces relapse rates.

There are two ways value is created here. Firstly, there is societal value, as patients return to work and become productive again. Secondly, there is measurable ROI. We commissioned an independent analysis in Germany looking at the socio-economic benefits of rehabilitation. The impact of rehabilitation on the system is that the cost is recouped in a matter of months in terms of people returning to work earlier and for longer, putting less pressure on the wider health and social care system.

Patients are also encouraged by the German pension fund, which is similar to the NHS, to engage with digital aftercare. We get paid for providing this digital aftercare product, making it a viable business model. The margins are healthy because the asset intensity is low, as there is no need for a physical brick-and-mortar facility.

This represents the future of rehabilitation, leveraging on-site resources for telemedicine, preventive measures, and ongoing digital aftercare, extending the ecosystem beyond the inpatient environment.

HBI: Engagement can be a challenge in digital healthcare. How do you deal with patients or staff who are hesitant to adopt new tools?

Schulte-Noelle: That is a common issue. Even the best product will fail if it is not integrated properly into clinical workflows. All stakeholders, from receptionists and nurses to therapists and chief physicians, need to embrace the digital tool within their ecosystem. Otherwise, it just creates noise and complexity.

We treat more than 300,000 patients a year, so even small disruptions matter. The first step is to design the technology so it fits naturally into existing processes. Clinicians are our ambassadors; if they believe in the tool, patients will too.

Patients also need to see clear benefits. Digital tools do not replace in person treatment decisions; they support them. They facilitate personalised therapy, provide better insights and allow clinicians to use their time more effectively. When tools genuinely improve care, patients engage more readily.

However, patients still need to engage and provide their data. To encourage this, we create user-led stories where patients explain the benefits they experience. For example, with our AI voice biomarker for depression, we were initially concerned about recruiting patients for trials because of their vulnerability. Starting early this year, we are approaching having 7,000 participants in the trial in Germany, with UK trials just beginning. By creating a sense of normality and clearly demonstrating treatment benefits, adoption increases. Achieving this required three years of constant engagement with stakeholders, including the German pension fund, to build trust in our solution. Once the outcomes were clear, patient adoption steadily rose.

HBI: Where is investment flowing in this sector?

Schulte-Noelle: There are two types of investments: those in healthcare providers like us, and those in health tech startups.

For investors in providers like us, we need to convince them that investing time and money in new technologies is worthwhile. They need to see a return on investment. One key parameter for us is quality of care. For example, CQC ratings in the UK or similar assessments in Germany demonstrate that we provide safe, effective and responsive care with high levels of patient satisfaction.

The second aspect is growth. Many of our patients do not receive acute care; they may stay with us for two weeks, three weeks, or in Germany, even six months, particularly in addiction treatment. This extended interaction allows us to collect long-term outcome data that can help develop more personalised treatments. There are funding opportunities for this work, including research grants in Germany, though they are still underused.

For tech startups, scaling takes time because healthcare adoption is slower than consumer tech. But once a product is proven in a pilot clinic and accepted by payers, it can be rolled out across many sites. For example, a successful pilot in one neurological clinic in Germany can be rolled out to many more clinics, creating a relevant business opportunity.

HBI: What are the main gaps in mental health rehabilitation that new investment could address?

Schulte-Noelle: In the UK, NHS resources are stretched even as care needs become more complex. Technology can help manage these challenges. Our AI voice biomarker, for example, could support GPs by providing objective data to guide referrals or psychiatry.

While this is still early stage, optimising triage in this way has huge potential.

We are also working with health tech companies such as Psyomics, partly funded by the NHS, to improve workflows in increasingly complex environments using digital tools.

These technologies support the goals of the NHS 10-Year Plan by enabling more effective, digital-first care. However, concepts must be proven in real-life settings, and that is where we, as the market leader in mental health, come in.

HBI: What about new entrants to the market? Are there barriers to adoption or regulation?

Schulte-Noelle: Yes, the sector is highly regulated. Depending on their product, entrants must secure CE marking [Conformité Européenne marking is the EU’s compliance mark for products] and other approvals before their products can be used clinically. Funding is another challenge. In the UK, for instance, companies must be recognised by the NHS and approved to become a credible partner to the NHS. On the private side, companies must often pre-fund and prove their concept. For example, we implemented a digital alcohol monitoring tool where therapists regularly supervise patients to ensure sustainable use. Once the concept is proven, it can then be adopted by NHS-led services.

Smaller firms often need to prove their concept before funding follows, which takes time and resources. That is where mental health-focused venture capital and private equity funds can help. These investors often work closely with the NHS, performing due diligence and validating products so that smaller companies can bridge the gap and gain trust. Such partnerships are increasingly common in the sector.

 

Philipp Schulte-Noelle will be speaking at HBI 2026. Make sure you get your tickets today, if you haven’t already!

We would welcome your thoughts on this story. Email your views to Rakshitha Narasimhan or call 0207 183 3779.