"The pandemic has taught us to take more precautions," Health Minister Jens Spahn told reporters.
The German government plans to spend one billion euros next year setting up 19 "national health reserves" dotted across the country to make sure Europe's top economy is better prepared for the next health crisis, he said.
"We are learning during the crisis, from the crisis," Spahn said.
The storage sites will contain supplies of personal protective gear including masks as well as medicines and ventilators for patients experiencing respiratory failure.
The goal is for each facility to contain enough supplies for a month for local hospitals, care homes and doctor's offices.
Initially the sites will be filled with items already available or ordered, including protective gear sourced from China.
But from 2022, the government aims to rely more on "made in Germany" medical equipment to reduce reliance on outside supply chains, Spahn said.
Germany coped relatively well with the first wave of the coronavirus in the spring, partly thanks to early and widespread testing and a robust healthcare system.
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But like other European nations, it too was caught off guard by the sudden demand for protective gear for health workers and scrambled to compete in the global marketplace for adequate supplies.
Since then, the government has pledged to create more incentives for homegrown firms to manufacture face masks, gowns, gloves and other medical items.
Germany has been hit hard by a second wave of coronavirus cases in recent weeks, pushing the total number of confirmed Covid-19 infections past one million, according to the Robert Koch Institute for disease control.
The number of patients in intensive care has soared more than tenfold since early October. More than 16,000 people have died from Covid-19 so far.
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