Community-based Mental Health Care Still Elusive in Israel's New Budget

The proposed 2017-18 budget will continue to encourage the country’s HMOs to hospitalize psychiatric patients rather than treat them in the community, despite the government’s declared commitment to community-based care, mental health officials say.

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Such treatment does an injustice to the patients and will erode the foundations of the mental health care reforms introduced last year, the officials said.

In Israel and throughout the West, the approach over the past decade or more has been to reduce the hospitalization of mental patients and instead provide frameworks for treating them in the community, including multidisciplinary clinics, ambulatory care, hostels, dormitories, and sheltered housing of various types. This approach has not only proven itself clinically, but has provided great social value after years of stigma, isolation and alienation.

An agreement for the rehabilitation and integration of mental patients in the community, which was signed by the health and finance ministries in 2001, focused on reducing the number of psychiatric beds, expanding ambulatory care and budgeting a basket of services for patients. Thousands of psychiatric beds were eliminated – from 8,600 in the 1970s to some 3,500 today.

The mental health reforms that went into effect in July 2015 were meant to be the next stage in expanding community mental health services and making them more accessible to the hundreds of thousands of people who need them. It was hoped that the HMOs would succeed where the state had failed in developing a wide variety of mental health treatment frameworks.

That hope was dashed. The HMOs have not opened a single treatment framework that is not a clinic since the reform was launched. Preventing hospitalization requires more intensive services than regular clinics can offer, but the reform agreement signed by the Health Ministry and the HMOs does not require them to open such frameworks.

The HMOs say they won’t do so unless they get more money. The ministries, on the other hand, believe that incentives are what will push the HMOs to develop community services.

The cost of hospitalizing a patient in a psychiatric hospital is currently set at 1,170 shekels a day. If the hospital is up to 95 percent full, the HMO pays full price for the patient. Between 95 percent and 108 percent occupancy, the HMO pays nothing, while it pays only 20 percent of the cost if occupancy is over 108 percent. Therefore, it is more worthwhile for the HMOs to hospitalize patients than to set up community frameworks.

Officials in both ministries understood that this formula needed updating. For the 2017-2018 budget it was indeed updated, though apparently not enough. The new formula calls for full payment for a day’s hospitalization if the hospital occupancy is up to 92.5 percent; around 31 percent payment between 92.5 percent and 108 percent; and 20 percent payment if occupancy is over 108 percent.

The new formula still doesn’t offer much of an incentive. Although the HMOs will have to pay full price for additional patients and more per patient sent to a hospital with almost full occupancy – 373 shekels for patients that were previously sent for nothing – it’s still more cost effective to hospitalize patients when compared to the 450 shekels to 650 shekels it would cost to set up intensive community day clinics.

The new formula left neither side happy; the HMOs will have to pay more for hospitalizations, while the psychiatric hospitals still believe they aren’t getting enough money to provide better treatment to patients.

A Finance Ministry official said, “We’re talking about a step in the right direction. It’s better than the previous situation and we hope it will kick-start the process on the part of the HMOs. The issue of treatment in the community is important and we know the Health Ministry has several plans to set up frameworks for the mentally disabled in the community.”

Not everyone believes that changing the hospitalization calculations will make the difference. “Changing the calculations is not the tool that will lead to setting up community frameworks, because there is a basic and substantial problem of underfunding,” said Prof. Gabi Bin-Nun, a health economist at Ben-Gurion University of the Negev. “The blanket is too short and changing the calculations won’t make it bigger. For this to happen you need more money and a supervision and control mechanism.”

The question is where the money will come from. The reform agreement signed with the HMOs left quite a few loose ends, and anything not specifically required by the agreement requires more budgets, which both the Health and Finance ministries are resisting with all their might.