Socioeconomic cabinet okays fifth health fund

New fund must enroll at least 40,000 members during the first year and 130,000 at the end of its third.

clalit 88 (photo credit:)
clalit 88
(photo credit: )
The socioeconomic cabinet approved on Wednesday the establishment of a fifth public health fund to compete with the four that have existed independently since 1995. The initiative, part of the Arrangements Bill and pushed by the Treasury, is aimed at improving the insurers' services by increasing competition. If approved by the Knesset, the fifth health fund will have to open clinics around the country and meet all the demands that have been required by the four existing health funds - Clalit Health Services, Maccabi Health Services, Kupat Holim Meuhedet and Kupat Holim Leumit. Today, the two largest health funds (Clalit and Maccabi) insure 80 percent of the population. Only about 1% of residents switch their health fund in any given year. The Treasury has argued that the "lack of competition" among the four leads to the waste of public money transferred to them - to the tune of NIS 25 billion, mostly in the form of health taxes - and reduces the quality of their services. The new health fund, if approved, will have to present a plan to the finance minister that will ensure that its targets are achieved in accordance with the 1994 National Health Insurance Law and will "include a subsidiary that will operate a medical center with efficient use of existing infrastructure and more efficiently make use of the potential of professional manpower in the general hospitals." The new health fund must enroll at least 40,000 members during the first year and 130,000 at the end of its third year. Finance Minister Roni Bar-On said after the cabinet decision that this was an "additional step in the government's general plan to encourage competition in the health system and improve health services provided to citizens." Numerous public health experts have opposed the idea of a fifth health fund, arguing that it would "lure away" the young, healthy and better-off parts of the population through special benefits, and thus weaken the other health funds.