Capitation payments to competing Dutch sickness funds based on diagnostic information from prior hospitalizations

In many countries market-oriented health care reforms are high on the political agenda. The purpose of these reforms is to make resource allocation in health care more efficient, more innovative and more responsive to the consumers' preferences. The Netherlands is no exception in this respect. The Dutch health care reform shows close similarities with the reforms in, for instance, Belgium (Kesenne, 1996), Germany (Graf von der Schulenburg, 1994; Files and Murray, 1995), Switzerland (Beck and Zweifel, 1996), Israel (Chinitz, 1994) and the U.S. (Newhouse, 1994). A common element of these reforms is that the consumers may choose among competing health insurers or health plans, which are largely financed through premium-replacing capitation payments