Israel's Universal Health Care System: A Comprehensive Overview

Israel's healthcare system is recognized globally for its quality and innovation, holding a high ranking by the World Health Organization (WHO). This article delves into the intricacies of Israel's universal healthcare system, examining its structure, benefits, challenges, and ongoing developments.

Historical Context

During Ottoman rule, healthcare in Palestine was underdeveloped, relying on traditional healers. Modern medical institutions emerged in the 19th century, with Jewish hospitals founded in Jerusalem. Christian missionary organizations also established medical facilities. In 1911, the Judea Worker's Health Fund, which later evolved into Clalit Health Services, was established to cover Jewish laborers and their wives, becoming the first Zionist health insurance fund in the country. In 1918, the Hadassah Women's Zionist Organization of America established the American Zionist Medical Unit (AZMU) to rebuild the Yishuv's medical system.

With the start of British rule, measures were taken to improve public health in the area. Family health centers known as Tipat Halav (from Hebrew: a drop of milk) were founded for the care of newborns, child development and vaccinations. The Yishuv's health system formed the basis of the Israeli healthcare system with the establishment of the state of Israel in 1948.

The National Health Insurance Law

The foundation of Israel's universal healthcare system is the National Health Insurance Law of 1995. This law ensures that all Israeli citizens and permanent residents have the right to receive healthcare. The law mandates that every resident must join one of four official health insurance organizations, known as Kupat Holim ("Patient Funds"). These funds operate as not-for-profit organizations and cannot deny membership to any Israeli resident.

Kupot Holim: The Cornerstones of Healthcare

The Kupot Holim (health funds) are central to the Israeli healthcare system. The four providers are Maccabi, Meuhedet, Leumit, and Clalit. Clalit is the largest of the four. Each Kupat Holim is required by law to offer a standard Health Basket and Medication Basket of services to all members. Members of each Kupat Holim can switch to another once a year.

Read also: UCF Application Strategies

Health Basket

The Health Basket is a comprehensive package of health services and treatments that each Kupat Holim must provide. The following fields of service are included in the health basket: Diagnosis, consultation and medical treatment; Certain medications based on the committee’s recommendations and the community’s needs; Hospitalization in a general hospital; Rehabilitation, including hospitalization; Accessories and medical supplies; and Medical services in the work place.

Funding Mechanism

The National Health Insurance Law establishes a system of public funding for health services through a progressive health tax, managed by Bituah Leumi (the National Insurance Institute). This organization transfers funding to the Kupot Holim based on a capitation formula, considering the number of members, their age distribution, and other factors. The Kupot Holim also receive direct government funding.

Wage-earners and the self-employed contribute 3.1% of their monthly salary up to 60% of the average market wage, and 5% of anything earned above it. Employers are legally obligated to deduct insurance contributions from their employees' salaries, while the self-employed must arrange payment on their own.

Supplemental Insurance

While the Kupat Holim provides a comprehensive set of basic services, many Israelis opt to purchase supplemental insurance, known as "Bituach Mashlim," to access additional services. About 40% of Israelis have private health insurance to supplement their Kupat Holim plan for quicker and more reliable care. These plans offer coverage for services not included in the Health Basket or provide coverage at an increased level. These supplemental plans are usually offered in two or three coverage tiers and include or provide discounts on services and products such as: second opinions from medical specialists, surgeries and other medical procedures by private physicians and in private or semi-private facilities in Israel and abroad, dental and orthodontic coverage for adults, discounts on drugs not included in the public "basket of medications", expanded maternity care, additional vaccinations and medical tests, alternative medicine, and more.

There are also private health insurance plans which citizens may participate in addition to the compulsory participation in one of four national health funds. They may be purchased directly from an insurance company as a private policy or under a group policy if offered as a benefit by an employer. These plans provide coverage for additional options for treatments beyond what is provided by the public health basket.

Accessing Healthcare: A Step-by-Step Guide

For Citizens and Permanent Residents

Enrollment: To receive healthcare as an Israeli citizen, you must sign up for Kupat Holim, one of Israel’s public healthcare companies.
Choosing a Plan: When you sign up, you choose your plan, any sub-plans or supplements, and your specific clinic.
Primary Care: Each plan provides access to primary care physicians, who serve as the first point of contact for most medical needs.
Specialty Care: Referrals from primary care physicians are typically required to see specialists, although there are exceptions for certain specialties.

For Visitors and Expats

Short-Term Visitors: Most visitors are not covered by Kupat Holim and need to make an appointment to see a private doctor in Israel.
Long-Term Visitors and Expats: Expats staying in Israel for an extended period should consider buying international health insurance for longer-term coverage. Foreigners who are in Israel for more than a short visit can sign up for a non-resident program with Kupat Holim. Students and expats with visas can access Israel’s government healthcare system. They have options to register and pay to join Kupat Cholim.

Urgent and Emergency Care

Urgent Care: If you are covered by a Kupat Cholim plan, your urgent care co-pay is usually covered with a co-pay, especially if you go to your recommended urgent care center.
Emergency Rooms: Emergency rooms are for serious and life-threatening injuries. You must pay for your care there if you do not have a severe condition that qualifies for an exemption.

Strengths of the Israeli Healthcare System

Universal Coverage: Israel provides universal healthcare coverage to its citizens and permanent residents via four independent health management organizations (HMOs) and a network of mandated benefit packages.
Quality of Care: Israelis praise their doctors’ expertise and surgical skills.
Innovation: Israeli healthcare facilities are modern and are receptive to innovative technologies and procedures. Israel is a global technology research and development hub.
Digital Health Ecosystem: Israel has an excellent digital health ecosystem and is considered one of the global leaders is many sub-sectors.
Mental Health Services: Affordable and quickly delivered mental healthcare is available.
Prescription Drugs: Prescribed medications are supported by government subsidies.
Choice of Health Plan: Residents can choose from four competing nonprofit health plans that must cover anyone who applies.

Challenges and Areas for Improvement

Bureaucracy: Israel’s government bureaucracy also impacts its healthcare system.
Gaps in Coverage: Almost 80% of Israelis pay for extra private insurance or a Kupat Cholim supplement to cover services such as dental care.
Information Accessibility: For visitors and expats, the main challenge of healthcare in Israel is finding the information you need. Many official details about Israel’s healthcare system are only available in Hebrew.
Competition for resources: suppliers face intense competition and should therefore be ready to compete and support their local distributors through educational presentations, material and lobbying/advocacy.
Aging Population: The aging population creates multiple challenges for Israeli society.
Private Health Spending: The government refrains from increasing the health system’s financial resources, despite population growth and technological requirements.
Shortages: With that, compared to other Western countries, Israel’s healthcare system is lacking in number of hospital beds, doctors and nurses per capita.

Recent Developments and Reforms

The Ministry of Health (MoH) is working to implement new procedures and expand the shift from hospital care to homecare.
The MoH also continues to improve the national patient medical record system, both for the benefit of the patient and for clinical research purposes.
The Government of Israel has recently launched the project with the objective of removing regulatory and infrastructure barriers hindering collaboration between health data-centric sectors.
The health insurance benefits package has been extended to include mental health care and dental care for children.
A multipronged effort is underway to reduce health inequalities.
National projects have been launched to measure and improve the quality of hospital care and reduce surgical waiting times, along with greater public dissemination of comparative performance data.
Major steps are also being taken to address projected shortages of physicians and nurses.
In 2015, responsibility for the provision of mental health care was transferred from the Ministry of Health to the NHI health plans.
In 2018, the Ministry of Health extended the responsibilities and scope of practice for specialist nurses in the community, to relieve some of the pressure on primary care physicians.

Healthcare Market Trends and Demographics

Local and International Competition
Shifting from Hospital Care to Homecare
Digital Health
Aging Population
Private Health Spending

Technical Standards and Reimbursement

The Standards Institute of Israel (SII) is the agency responsible for the development of most product standards, compliance testing, and certification of products and industry quality assurance system.
Israel’s reimbursement system, known as ‘health service basket’ , includes all the services, medications, supplies and medical equipment that the insured is entitled to under the National Health Insurance Law.

Leading Sub-Sectors

Digital Health
Medical Devices

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