Voluntary insurance rates were to be determined by costs and demand for medical programs in a fee-for-service insurance mechanism. The mandatory public rates were based on local health department budgets. Any regional deficits would be subsidized by the Council of Ministers of the Russian Federation. Competition between plans was assumed to provide the market incentives for the growth of a new health care industry. It was the hope of the Russian legislation that this revenue-generating industry would have an innovative impact upon the educational and scientific sectors in Russia, upon other depressed industries such as chemicals and plastics, as well as upon the overall quality of life and well-being of the work force.