The objective of this report is to provide an assessment of the reform process of the health care sector in the Countries of Central and Eastern Europe (CCEE). It shall assess the overall direction of the reforms and focus in particular on health financing and pharmaceutical policy making as two important elements of structural reform. The first part of this report provides a brief overview of the state of health of CCEE populations and the process of health care reform. The second part of the report discusses health financing and pharmaceutical policy reform. It focuses on these two topics for the following reasons:

• health financing is an integral part of the health care reform process throughout CCEE.

Without reform of the health financing system, it will be very difficult to embark on a sustained effort of health care reform;

• pharmaceutical policy reform has been a component of health care reform in most CCEE.

The rationale for this is that the use of pharmaceuticals constitutes a straight-forward and – in comparison to the reform of other sectors such as hospital care – relatively in-expensive technology to bring about improvements in health. This report is based on a review of the literature on health care reform in the CCEE as well as the collection of empirical data by means of a survey among health care policy makers of seven CCEE initiated by the Office of Health Economics in 1994.