Thank You for Your Money Ladies, and Good-bye

Anshel Pfeffer
Anshel Pfeffer
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Anshel Pfeffer
Anshel Pfeffer

Hadassah, The Women's Zionist Organization of America laid the foundations for modern medicine in Israel, but the medical center’s crisis is a signal that Israelis must take responsibility for themselves

There is probably not one Israeli today who has not benefitted at some point in life from Hadassah University Hospital, was born or had a child enter life there, received treatment or underwent an operation. Even if they and their family members never entered one of the Jerusalem hospitals at Ein Karem or on Mount Scopus, they were certainly treated by doctors and other medical practitioners who graduated from Israel’s oldest and arguably still most prestigious medical school.

And yet only a small minority of Israelis and not even most Jerusalemites were aware until a few weeks ago of the fact that the hospital they regard as a national institute and constant fixture in their lives is actually owned by a group of Jewish philanthropists in America, Hadassah, The Women’s Zionist Organization of America. In its 102 years of existence, Hadassah may have laid the foundations for modern medicine in Israel but that is of little relevance to Israelis today. The organization’s founder, Henrietta Szold, deserves to be remembered as one of the great pioneers of Zionism, but there was little room for her in the masculine pantheon of fighters, generals and politicians. Founding hospitals and nursing schools was never going to be as sexy as leading men in battle, and Szold did herself no favors by supporting Brit Shalom with its belief in a binational state and Jewish-Arab cooperation. After her death in 1945, Hadassah Women continued to prosper for decades as one of the most influential Jewish organizations in the U.S., famed for its fund-raising, while Israelis just got used to having the hospitals.

Now, all of a sudden, they have been thrust into the spotlight as an ugly battle of blame is being fought out in full media glare over responsibility for the 1.3 billion shekel deficit that has left the medical center, the biggest private employer in Jerusalem, incapable of paying salaries and forced to appeal to the courts to get the creditors of its back. There’s a long list of culprits − senior management who hid the full figures, the government which failed to regulate, the health maintenance organizations which forced Hadassah into disadvantageous arrangements, wealthy doctors who used the hospital as their base for private treatments, unions who gouged preferential terms for favored members and the good women from overseas bequeathed Hadassah an archaic ownership structure and a $360 million 14-story new hospital tower that the hospital cannot afford to operate.

Nothing is holy in this very Israeli mud-fight, and no one is coming out well. The media have been inundated with wild figures of senior doctors’ and executives’ salaries, the details of former executive director Professor Shlomo Mor-Yosef’s golden parachute, how respected members of the board looked the other way and sordid stories of how Hadassah women lost much of their investment fund in the Madoff scandal. They tried to remain above the fray, preferring instead to use PR people and direct the blame elsewhere, and really, why should they be blamed? All they did over the years was to donate hundreds of millions and ensure that the people of Jerusalem enjoyed a first-class level of medical treatment, but they have been forced to fight back because now they are being faced with the ultimate humiliation: nationalization of the medical center that will wrest control over its affairs from their hands. How could the people of Israel be so ungrateful after all we have done for them?

There is no question that Hadassah should be nationalized. An organization that has created for itself a 1.3 billion shekel deficit and can only be saved by a massive government bailout has no alternative but to cede ownership and effective control to the state. Or else go under. Arguing that the funds Hadassah provided over the decades should grant the organization perpetual private ownership disregards the fact that even before the looming bailout, it was in reality a public medical center, with the lion’s share of its budget always coming from the Israeli taxpayer. There are other ways to recognize Hadassah women’s contribution than clinging to a historical anomaly that contributed, at least in part, to the current crisis.

The arguments made by Hadassah President Marcie Natan and Israel Director Audrey Shimron against nationalization make as much sense as the Rothschild family issuing a demand that since it funded much of the construction costs of the Knesset and Supreme Court buildings in Jerusalem, they also get to appoint the MKs and justices. If there were six or seven other general hospitals serving the capital then maybe it would make sense, but Hadassah operates two out of Jerusalem’s three main general hospitals.

Conceivably, if they had the necessary funds to dig Hadassah out of its hole, they may be allowed to retain some control, but the most they are capable of offering is $25 million from their depleted investment fund, less than 10 percent of what the hospitals’ need to ensure their long-term survival.

The government will of course bail out Hadassah and the mandarins of the treasury’s budget department − the most powerful civil servants in Israel − will make sure that effective control of the medical center’s financial affairs is transferred to the government. There is no other way they will agree to fork out what will be at least a billion shekels over the next few years. Hadassah women will never again have much of a say in the decision-making. While to all purposes this will be de-facto nationalization, it will probably be called something else. Prime Minister Benjamin Netanyahu, facing considerable pressure from the Obama administration on the Palestinian and Iranian issues, is too fearful of adding to his troubles a potential showdown with the old American Jewish establishment.

Hadassah women may have lost much of their stature due to generational changes and the shifting landscape of Jewish philanthropy, and are no longer a central pivot of American Zionism as they were a generation ago, but they still wield considerable influence. What they lack in fund-raising prowess and financial acumen, they still have in lobbying clout. Israel Director Shimron is married to one of Netanyahu’s oldest childhood friends and personal lawyer. The Women’s Zionist Organization of America would become a nonentity overnight if it is forced to abandon its connection to the Jerusalem hospitals. Netanyahu won’t do that to them. They will retain their titles, be allowed to continue fund-raising on the medical center’s behalf in North America, hold their galas, cut ribbons, fete each other and make passionate speeches, but that’s all.

The Hadassah debacle has provided a valuable lesson to both Israelis and American Jews. While the financial assistance of the Diaspora was extremely valuable, perhaps crucial, to Israel in its early years, continuing to rely on the generosity of kind women in America can lead to bankruptcy, as it has in Hadassah. Israelis have to take ownership of their own social issues, just as they must do with all their other challenges. This doesn’t mean we are ungrateful in any way, only that we have to grow up. We’re still friends and if you want to continue donating, that’s great, but if not, well then, thank you ladies for your money and good-bye.

A worker holding up a sign during a protest at the hospital, reading, 'Hadassah needs intensive care.'Credit: Olivier Fitoussi

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