Journal of Public Health

, Volume 14, Issue 6, pp 385-390

First online:

The funding and purchasing of health care—a book with seven seals

  • Klaus-Dirk HenkeAffiliated withFaculty VIII Economics and Management, Institute of Macroeconomics and Economic Law, Chair for Public Finance and Health Economics, Technical University Berlin Email author 

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After examining the ongoing debate on health care in Germany, the functional and institutional features of the German system are characterized. Regarding external funding of the German health care system, one of the favored alternatives in the current debate is the possibility of introducing per capita payments. After a short introduction to the capitation option, I show that there are other options, such as a mixed system of capitation and contributions based on income. External funding describes the form of revenue generation. On the other side, internal funding is the method of how different health care services are purchased or reimbursed. This becomes a rather hot topic in light of new trends for integrated and networked care to patients and different types of budgeting. Another dominating question in the German health care system is the liberalization of the contractual law, with its “joint and uniform” regulations that have to be loosened for competition gains. Having discussed the consequences of diagnosis-related groups (DRGs) in Germany, I conclude with a note on the political rationale and its players.


Health care system External and internal funding Capitation Health care reform DRGs Contractual law