Hospital financing in Belgium: recent changes and future options

A new mode of financing hospital operating costs has been gradually introduced in Belgium since 1982. It is a 'prospective pricing' system. Each hospital is assigned a budget envelope at the beginning of the fiscal year. This budget is calculated on a per diem basis. A portion of the budget is variable in function of the number of patient days. The annual budget of each hospital is determined by comparing its performance with the one of a reference group of similar hospitals. Since the introduction of the new mode of financing the financial situation of the Belgian hospitals has improved markedly. Moreover, the hospital expenditures of the health insurance scheme are under control: in 1984 and 1985 these expenditures increased at a lower rate than inflation. The continued increase of other medical expenditures, however, indicates that the principles of this new financing system should be extended to the medico-technical departments.