The hospital financing system in Germany

Abstract

In common with other western countries, German health expenditure had been increasing at a rapid rate in recent years, especially in the hospital sector. This paper describes the reaction of the German legislator and summarises what has happenedover the last few years following the introduction of the extensive Legal Reform Act.The paper puts the main emphasis on a new differentiated benefit system for hospitals, which is a requirement from 1996 onwards, after a transitional period. It shows the single components and the modalities of the new system and the possibilities of combining the new types of payment.