The transformation of the Dutch health care system and the impetus behind the market-oriented health care reforms implemented since 1989 are examined. During the postwar period, the gradual transformation of the Dutch health care system was interrupted twice by attempts to introduce radical reforms: the 1974 comprehensive health plan and the 1987 pro-competitive national health insurance program. The market-oriented reform involves a fundamental change of the incentive structure for insurers and providers. The objective is to interest both parties in containing costs and improving efficiency while preserving universal access through central redistributive financing. In the Dutch political context, radical reform proposals can be introduced only by a prolonged series of incremental changes, which offer the corporatist organizations of providers and insurers ample opportunity to dismantle the original reform design. The 1974 comprehensive health plan failed largely because of this corporatist trap. The 1987 market-oriented reform program faced the same risks, although it appeared to offer an ingenious political compromise. Private health insurers were particularly successful in slowing the reform by frustrating the development of a prospective, risk-adjusted payment mechanism. The resistance of corporatist organizations to the 1974 and 1987 reforms provoked a largely unplanned process of creeping etati-zation. Paradoxically, the present market-oriented reforms coincide with far-reaching state interventions in determining provider fees. A new, more satisfactory balance between corporatism, etatism, and market mechanisms must still be found.

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