'Meuhedet directors meeting focused on media image'

Exclusive: 'Post' obtains secret protocol of board meeting after severe State Comptroller report levels corruption allegations against health fund.

November 22, 2010 21:47
4 minute read.
Kupat Holim Meuhedet

Meuhedet 311. (photo credit: Marc Israel Sellem/The Jerusalem Post)

In its first board meeting after State Comptroller Micha Lindenstrauss leveled devastating corruption allegations against Kupat Holim Meuhedet last week, the health fund’s board of directors took no operative decisions whatsoever and focused instead on how they looked in the media and how to survive in their positions, according to the protocol of the meeting.

Lindenstrauss stated in his report last week that it was among the most severe reports he had ever published, and his office added that it was one of the most critical ever released.


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On Monday, The Jerusalem Post obtained the secret protocol of the meeting, held a day after the November 15 publication of the State Comptroller’s Report. It was convened by board chairman Rabbi Yerachmiel Boyer, a former mayor of Bnei Brak, and attended by 15 others, including Meuhedet director-general Shmuel Muallem, a key figure in the report and the alleged crimes.

Besides three lawyers, the participants also included Tal Rabina, owner of the external public relations agency that represents the health fund, and Rabina’s employee Ahuva Lif, Meuhedet’s official spokeswoman.

Asked what had happened in the health fund – which insures almost a million Israelis – since the report was published, Lif reacted Monday morning with a three-sentence statement, saying that Meuhedet had “begun to examine the report’s findings, all in accordance with the law and the instructions of the Health Ministry director-general [Dr. Ronni Gamzu].”

As for specific matters, she said, “those in the report and those not mentioned by the comptroller, recommendations will be formulated and the authorities updated” only after the issues are examined.

However, the November 16 board meeting was regarded by some senior ministry officials as consisting of delaying tactics to put off the consequences, which in a month or two could lead to the board’s replacement by an appointed governing body of professionals chosen by the ministry.

Immediately after the report was published, Gamzu fired off a letter to Boyer, instructing him to convene the board immediately and report back on decisions taken.

However, the nine-page protocol of the meeting, held in Meuhedet headquarters in Tel Aviv, contains no decisions at all and was undoubtedly read over carefully by health fund lawyers. It could not be determined whether the protocol was “doctored,” whether participants were told in advance what to say or if it in fact represented a true discussion by participants.

In 286 pages, the comptroller accused dozens of management members of nepotism, waste, concealment of documents, flagrant mismanagement, bribery, conflict of interest, nonexistent accountability, failed supervision, and outright criminality on the part of senior administrators. The right to supply services and equipment was allegedly given to companies owned by relatives of management officials, without a tender.

Tens of thousands of haredi yeshiva students and families in Jerusalem were allegedly paid off to switch to Meuhedet from other insurers because they were cheap to insure, given their young ages, large families worth a large share of health taxes, and low demand for expensive services. Expensive medications not included in the official basket of services were handed out to friends and even Meuhedet managers at a time when members’ requests for lifesaving drugs were turned down because they were not in the basket, according to the report.

The alleged wrongdoings are described as having occurred under the previous director-general, Uzi Salant, and Muallem, whom the Health Ministry opposed because it regarded him as “unsuitable for the job.” But since the health fund has the status of an Ottoman society that can supervise itself, the ministry was not able to prevent Muallem’s appointment.

The illicit activity allegedly went on for 10 years or longer and may have meant the loss of tens or even hundreds of millions of shekels in Meuhedet’s public funds, according to ministry estimates.

Some of the board members said they hadn’t even received a copy of the comptroller’s report, so Boyer and a health fund lawyer had to describe the allegations.

“I don’t want to discuss the media aspect. It will simmer down in a few days, but as a result of publication, there will be cases of people throwing rocks [at us], and we will be asked questions... about things that were forgotten,” said Boyer.

He added that the board had a “chance of survival only if we relate to this matter seriously. If we cover up, it won’t work. We have to take far-reaching decisions... I am afraid what will be said about us or whether we will be sent packing. Understand that we are being stuck with the stigma of people who don’t reach decisions.”

Board members did, however, mention the allegation that the health fund’s chief pharmacist prevented the opening of a Meuhedet pharmacy in Jerusalem’s East Talpiyot neighborhood for seven years because it would harm the business of his own pharmacy, which he allegedly ran with three Meuhedet pharmacists paid by the health fund.

One board member said he had opposed this situation, but that nothing had been done to end it.

A suggestion for the health fund to name an independent committee headed by a judge, to delay ministry action, is also mentioned in the protocol.

Rabina suggested that the health fund issue a press release with “more meat,” but nothing further was decided.

On the day the report was issued, Rabina and Lif said merely that the health fund had provided excellent services with a balanced budget and would observe the law.

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