ABSTRACT
The Central and Eastern European countries are replacing their government-financed health services with insurance schemes, or are planning to do so. Health services for the compulsorily insured are not left to the functioning of the unregulated free market because several vital elements for the functioning of such a market are missing. Health insurance can be adapted to encourage personal preventive services by financial incentives. Health promotion can be encouraged by a regulation requiring all health insurance funds to spend a specified proportion of their income on health promotion. Health insurance contributions provide a relatively stable source of income which cannot be diverted for other purposes without an explicit change in the law. The insured above the lowest levels of income are able to obtain free primary health care from the public sector but have to pay 25 per cent of the cost or, if their earnings are a bit higher, 50 per cent of the cost for hospital care.
