The German Federal Ministry of Health and Social Security declared that 2003 would be the year in which to modernise the 120-year old Statutory Health Insurance (SHI) system. Indeed the SHI, funded equally through contributions by employees and employers, is confronted by mounting problems. On one hand, the revenue base is shrinking because of economic and demographic changes with persisting high rates of unemployment and increasing numbers of pensioners. On the other, the statutory sickness funds expenditure is rising, especially for pharmaceuticals. The funds made deficits of circa A3 billion in both 2001 and 2002, and as they are not allowed to incur long-term debts they were forced to raise contribution rates. The average contribution rate has increased quite steeply from 13.6% of gross earnings in 2001 to 14.3% two years later. The last such increase (from 12.4% to 13.2% between 1991 and 1993) was followed by the Health Care Structure Act, the greatest reform act of the 1990s.