Through the recent National Health Insurance Act (NHIA), the Philippines have committed themselves to introducing a social health insurance with universal coverage within 15 years. Germany was the first country to introduce a social health insurance system more than 100 years ago. Its system is based on the principles of corporatism, federalism and a mandate for equity. Based on a long-term German experience with equity, quality, cost and efficiency issues, the Philippines' NHIA is analysed concerning the entitlement to benefits and the benefit package, the organization of the health insurance programme, health insurance financing, and provider payment mechanisms. It is suggested that the Philippines could profit from including preventive and promotive services as well as pharmaceuticals in the benefits package. The organization of the health insurance system could be decentralized using the 13 regions as its principal units. To achieve financial equity between regions and health funds, a contribution compensation scheme is proposed. To prevent over-utilization in over-served areas and to promote utilization in under-served areas, a relative value scale for fee-for-service payments seem advisable.