Israelis Have Netanyahu to Thank for Erosion of Egalitarian Health Policy

The shift in Israel’s attitude toward funding for health care is the result of policy decisions made by successive Israeli governments, and in particular by Prime Minister Benjamin Netanyahu.

Daniel Bar-On

Hundreds of thousands of Israelis rely on charity – including from the organization Haverim Lerefuah (Friends for Health), which hands out medicines to the needy on a daily basis – to obtain vital medicines. Many Israelis forgo medical care and medicines due to the cost, even when they are part of the subsidized “basket” of drugs and services, because of the relatively high co-payments. Studies over the years show that nearly a fifth of the population forgoes drugs or medical care due to the co-payments.

The recent article in the Haaretz Hebrew edition that reported on these studies (Ido Efrati, April 19) points out that Friends for Health tries to minimize its use of unused medications donated by members of the public, whose safety may be in doubt, in favor of direct contributions from drug companies. However, drug safety is not the only issue. Prof. Danny Filc is quoted in the article, rightfully calling for the elimination of co-payments for drugs that are in the basket.

It should be remembered that the current situation is the result of an intentional policy that can be traced directly back to Prime Minister Benjamin Netanyahu. The National Health Insurance Law, which was passed in 1994 and went into effect in 1995, promised universal health coverage for all residents of the state. It was the first Netanyahu government (1996-1999) that introduced the changes that created the current situation. First, in 1997, the employer contribution – which funded a significant proportion of the basket of drugs and services – was abolished. Next, in 1998, an amendment was passed reducing the state’s obligation to make up the difference between the premiums collected by the state through health tax and the actual cost of the basket. The amendment stipulated that the HMOs must collect payment for drugs and services directly from its customers.

As a result, the mechanism for funding the basket shifted from a progressive one (relying on the health tax and general tax revenues) to a partly regressive one (relying also on direct payments). During Netanyahu’s term as finance minister, in 2003, the exemption of welfare recipients from drug co-payments was abolished, on the grounds that it encouraged people to choose to remain unemployed in order to receive medicines for free.

The National Health Insurance Law stipulates that co-payments are to be uniform and nondiscriminatory, but that is an oxymoron: Uniform co-payments discriminate against the poor, who forgo medicines or rely on charity. The result is unequal and inefficient – when someone forgoes medicine because of its cost, they often end up using a different, generally more expensive, health service, such as hospitalization.

Co-payments contradict the express principles of the health insurance law – “justice, equality and mutual aid.” They violate the principle of basic justice in health, according to which medical care is supposed to be rendered according to need, not the ability to pay. They reflect the transformation of health from a right to a commodity, and of the patient from a citizen to a consumer. The HMO membership card has become a credit card through which these payments are collected, part of the privatization of the financing of the medical system.

While the share of funding for health care from government revenues in Organisation for Economic Co-operation and Development member countries is on average 72 percent, with the remaining 28 percent coming from private sources, in Israel – which used to be in this range – the ratio is about 58 percent public funding and 42 percent private.

The situation described in Efrati’s article is not, therefore, the result of divine decree. It is the result of policy decisions made by successive Israeli governments, and in particular by the incumbent prime minister in his various “hats.” Perhaps this is the place to remind him that, without an egalitarian health policy, it is impossible to guarantee what he likes to call “life itself.”