Bikur Holim Hospital strangled by medical liability hikes

The hospital will have to pay NIS 120,000 more for the rest of this year's medical liability insurance.

November 24, 2005 03:38
2 minute read.
Bikur Holim Hospital strangled by medical liability hikes

bikur holim 88. (photo credit: )


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As if unpaid pensions to its former workers were not enough of a problem, Jerusalem's Bikur Holim Hospital will have to pay NIS 120,000 more for the rest of this year's medical liability insurance than it did the previous year. The figure was a "compromise" reached Wednesday in the Jerusalem District Court, which put the hospital into receivership. It is currently considering an offer for purchase by a group of Israeli businessmen who established a non-profit organization to do so. After 45 days are over and the payment is made, and if the hospital is sold, the matter will be renegotiated. If it is not sold by then, the two sides will have to return to the District Court for an additional hearing. As a result of negotiations between Bikur Holim management and the Madanes insurance company, the hospital will be charged $2,325,000 for a year of insurance from Madanes, the sole Israeli medical insurance company available to non-government hospitals. In 2003, the Madanes insurance charge was only $787,000 a year, and it has steadily risen since then. The insurance company had asked for even more for 2006 - $2,535,000, but it agreed to reduce it by a small sum. Hospital director-general Bari Bar-Zion said that the Madanes company's annual bill constituted eight percent of the hospital's annual turnover - a huge sum that the hospital could not afford. Bar-Zion added that the premium was "absolutely exaggerated and not justified by the excellent record we have in this field of medical risk management for the past two years. We are running the operational budget balanced for the past year and a half and with no reserves or credit line. This means that such an addition in expenses - even if it were justifiable - would have to be compensated or cut from other purposes immediately." After the hospital was put into receivership, pensions were paid, in part or in full, by the Treasury, even though the hospital is owned by a voluntary organization. However, the would-be purchasers have not made any commitment to cover the pension costs. Shuki Madanes, the head of the insurance company, explained the periodic steep rises in insurance premiums for medical liability by noting the significant increase in malpractice and negligence suits against Israeli doctors. Some argue that Madanes feels free to hike prices because few insurance companies have entered the field, and suggest that the state should establish its own non-profit malpractice insurance policy for non-government hospitals.

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