- © .
Since the introduction of the system of diagnosis related groups (DRGs) for USA Medicare patients in 1983, case payment mechanisms have gradually become the principal means of reimbursing hospitals in most developed countries. The use of case payments nevertheless poses severe technical and policy challenges, and there remain many unresolved issues in their implementation. This paper introduces a special issue of the journal that describes and compares experience with the use of case payments for reimbursing hospitals in nine European countries. The editorial sets the policy scene, and argues that DRG systems must be seen both as a technical reimbursement method and as a fundamental incentive mechanism within the health system.