Government Panel: Take Hospital From Hadassah Women

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Hadassah hospital in Jerusalem.Credit: Shiran Granot

The Hadassah women’s organization’s century-old sponsorship of Jerusalem’s Hadassah University Hospital should be ended immediately, concluded a report released on Tuesday by a government committee examining the hospital’s plight.

The report, which was given to Health Minister Yael German, blamed systemic failures involving almost all the players for the hospital’s financial collapse. “Nearly everyone who was involved had a hand in bringing the hospital to its current state,” the report said.

The report comes two months after the capital’s storied medical center filed for court protection from creditors, saying it had run up a deficit of some 1.7 billion shekels ($489 million) and couldn’t pay salaries.

The panel, headed by former Bezeq CEO Avi Gabay, said the finance and health ministries were to blame for imposing onerous regulations while engaging in poor financial supervision, not only at Hadassah but at all the country’s hospitals.

But the report faulted the Hadassah women’s organization, too.

“The owners of Hadassah, while raising huge sums of money, failed to properly navigate the hospital during the crisis,” the Gabay committee said about the women’s organization. “The board of directors and its chairman, first and foremost its Israeli directors, filled their roles but had no significant influence over hospital management due to the organization’s governance structure.”

The hospital’s management was also cited for its role in the hospital’s collapse.

“Hadassah’s administration over the years created [an institution of] quality medicine and research excellence, and worked to develop a modern and innovative hospital, but at the same oversaw a weak and inflexible system unable to cope quickly and effectively with the changes that had occurred in the health system over the past decade, particularly in the last five years,” the report reads.

The hospital’s doctors and other staff didn’t escape criticism in the Gabay committee’s report. It blamed employees for allowing the hospital payroll to grow too quickly and for pay rises that rose faster than elsewhere in the health system.

“At the time of the crisis they didn’t make any effort to help or offer in any serious way to significantly and permanently reduce costs,” the report read.

The report scored the administration of Hadassah’s current CEO, Avigdor Kaplan, who took over last year. However, the Gabay committee did not ascribe any personal responsibility to anyone for the hospital’s financial failure.

A spokesman for Hadassah University Hospital sharply criticized the report for “lacking objectivity.”

“Its description of those responsible for the crisis has shortcomings, discounting the true causes and focusing on internal problems, thereby freeing the government from responsibility for deepening the crisis over the years,” the hospital said in a statement.

Audrey Shimron, executive director of the Israeli office of the Hadassah women’s organization, declined to comment and said the organization was still deciding how react to the recommendations.

The Gabay committee said that even if control of the hospital is taken away from the Hadassah women’s organization, the New York-based group should be given a role.

The restructuring of control should be undertaken “while preserving a role for the [Hadassah women’s] organization and preventing as much as possible an aggressive nationalization process, which could lead to unnecessarily wide repercussions,” the committee said.

The Gabay committee was formed shortly after Hadassah received court protection, and in the last five weeks has conducted intensive deliberations, including testimony from scores of officials at Hadassah and the health system.

Among its other recommendations was that Hadassah revise its revenue-sharing arrangements for private medical services, popularly know by its Hebrew acronym Sharap. If the hospital increases its share to half of all the revenues, or about 250 million shekels annually, it will be able to narrow its operating deficit by about a third, the report estimated.

Other proposed changes include restructuring the board to make it more independent, and to do away with the veto the Hadassah women’s organization has over its decisions. The board should number 11 directors, two from the women’s organization, two from the staff and the rest appointed in the same way other government companies do, the committee recommended.

Hadassah hospital employees striking on Feb. 16, 2014.Credit: Emil Salman

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