Litzman Vows to Ban Duplicate Health Insurance

Most Israelis buy supplemental coverage from their health maintenance organizations beyond what the state requires the HMOs to provide

Deputy Health Minister Yaakov Litzman has pledged to crack down on the problem of duplicate health coverage, even asking his audience at a conference last week why they would pay twice for medical insurance if they wouldn't do so for cottage cheese.

Most Israelis buy supplemental coverage from their health maintenance organizations beyond what the state requires the HMOs to provide. But many Israelis also have coverage through private insurers. Government officials say there is unnecessary overlap.

Unlike the private companies, the HMOs are nonprofit organizations that provide public medical services to all Israelis. Their supplemental coverage goes by different names among the country's four HMOs. At Clalit Health Services, for example, it is known as Clalit Mushlam and Clalit Platinum. At Maccabi Healthcare Services, it is known as Magen Zahav.

Litzman particularly criticized the insurance companies' practice to refer policyholders making claims to file with their HMOs first - increasing the demands on the publicly funded HMOs.

"I intend to ban duplicate insurance," Litzman told delegates from the Israel National Institute for Policy and Health Services Research. "We're talking about at least half a million shekels that clients pay twice, in two places. This money needs to go into the [public] health system," he said, adding that health insurance should be supervised by the Health Ministry, not the Finance Ministry.

"I need to supervise this. We can lower health costs and invest in other things," he said, speaking at a health-policy conference at the Dead Sea.

Litzman also criticized the Finance Ministry for what he said was a failure to release enough data on commercial insurance. Such data includes the number of people covered, variations among policies and the companies' claims ratios.

Litzman also said a key 2008 decision was a mistake: barring the HMOs from including coverage in supplemental insurance for life-saving drugs that are not covered by the basic state-mandated "health basket." Litzman voted in favor of the ban as a member of the Knesset Finance Committee.

"They pressured me and I agreed, and I regret it to this day," he said. "What are lifesaving drugs? If there is a reason to provide things through the supplemental coverage, this is the reason."

Regarding custodial nursing care, for which the HMOs and private insurers sell coverage, Litzman acknowledged that he failed to push through a reform plan to provide universal coverage by the state, to be funded by increasing the health tax by 0.5%.

In practice, Litzman is at the head of the ministry, though Prime Minister Benjamin Netanyahu formally holds the health minister's portfolio.

With the approach of the January 22 general election and the formation of a new government, Litzman said he hopes to keep his post and push through the nursing coverage plan, even putting it in the coalition agreement.

"There's no reason children have to pay for parents for whom nursing care [coverage] is limited to four years as it is with the private insurers, so it will be on the agenda for the next term," he said.