In response to a request from the Secretary of the Department of Health and Human Services, the Institute of Medicine convened a committee to identify possible demonstration projects that might be implemented in 2003, with the hope of yielding models for broader health system reform within a few years. The committee is recommending a substantial portfolio of demonstration projects, including chronic care and primary care demonstrations, information and communications technology infrastructure demonstrations, health insurance coverage demonstrations, and liability demonstrations. As a set, the demonstrations address key aspects of the health care delivery system and the financing and legal environment in which health care is provided. The launching of a carefully crafted set of demonstrations is viewed as a way to initiate a "building block" approach to health system change.