CURRENT ISSUES IN GERMAN HEALTH-CARE

Germany has developed a model of social health insurance for financing healthcare. The basic characteristics of this model are compulsory me mbership, income-dependent contributions paid by employers and employe es, a comprehensive package of healthcare entitlements, stringent gove rnment regulation and implementation by not-for-profit health insurers - the sickness funds - which operate under public law. Since the mid- 1970s, when health care cost containment gradually evolved as a new is sue in German healthcare policy-making, a long series of reform progra mmes have been initiated. Two recent development can be noted: the int roduction of market competition in health insurance and the introducti on of fixed budgets. Market competition in health insurance is now an explicit policy tool in Germany. This article analyses the German heal thcare system, the history of healthcare reforms and the current healt hcare acts. Special emphasis is given to the German drug market and it s regulation. The paper describes the present cost-containment policy for pharmaceutical products, especially the global budget concept whic h was introduced for medicines and patients' copayments.