The fire, which occurred on Thursday night, also left “a double-digit number” of people injured, several of them seriously, a Lueneburg police spokesman told AFP.
The fire broke out at 10:45 pm (2145 GMT) and when emergency services personnel arrived, flames were visible on the third floor as well as “a lot of smoke”, police had said in an earlier statement.
“Calls for help were heard” from the building, police added, and the hospital was evacuated as the fire was extinguished.
Police initially said one person had died in the inferno, before updating the toll on Friday.
According to German media reports, the four people who were killed were patients.
Authorities have launched an investigation into the cause of the fire, which is estimated to have resulted in more than a million euros ($1.1 million) in damage.
The reason for the fire remained unclear and an investigation was being conducted “in all directions”, the police spokesman said.
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