The government will prohibit Israel's health maintenance organizations from offering essential drugs, that aren't included in the standard health basket, under their premium insurance plans.

This decision was agreed upon between the Health Ministry and the treasury on Monday that the expansion of the health basket, which includes all the drugs that the state subsidizes, will hinge on this prohibition. The HMOs currently offer these drugs under premium plans.

Some six months ago, the main HMOs launched upgraded premium insurance plans which offer patients medication to treat cancer and other serious illnesses. The prohibition suggested by the Health Ministry aims to make the premium plans less attractive, forcing the HMOs to offer the same terms to those who can afford to pay premium rates, as well as to those who can't.

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The decision will only slightly affect the smaller HMOs and the general insurance plans.

Health Minister Yacov Ben-Yizri said at a press conference in Tel Aviv on Monday that the change reflects his aspiration for equal-opportunity medicine. He explained that the expansion of the health basket will provide more drugs to everyone, eliminating the need for premium insurance. "In public medicine, one must aim for maximum equality between insured citizens, as part of the public health system," the minister said.

As expected, the HMOs were not happy about this decision. The Maccabi HMO said in a statement "we will do everything within the law to prevent the government from approving this decision." The HMO Clalit accused the government of failing to fulfill its duty to provide medication for all the sick by leaving drugs out of the health basket. They said that this decision would bring about "the return of heartbreaking situations in which very sick patients cry out for life-saving drugs."

The Health Ministry and the treasury also agreed to increase the health budget by some NIS 1.5 billion within the next three years. The funds will be funneled into the health basket, which will grow by NIS 325 million during each of the next three years. The total cost of the basket will rise from the current NIS 24 billion per year, to NIS 25 billion in 2010.

This growth rate is in fact slower than that of 2006-2007, during which the basket was expanded by NIS 695 million in two years.

At the press conference, Ben-Yizri presented figures showing that during the last decade the basket has grown by an average of NIS 170 million per year.


The Health Ministry suggested several years ago that the budget for the health basket be determined in advance, instead of being renegotiated every year. The Health ministry claimed that such an arrangement would end the yearly campaign to expand the basket. The ministry suggested that a regular percentage of growth be predetermined.

However, the treasury categorically rejected this proposal, for fear of being bound to a certain amount for many years to come, as well as the fear of being subject to pressures to increase the predetermined amount regardless of the agreement. Finally, the treasury agreed to a predetermined yearly addition in shekels (not percent) for three years. The deal was conditioned on the prohibition on HMOs from selling premium insurance plans.