Health Ministry to Meuhedet: Fire director-general, others

If board does not dismiss executives, ministry has right to appoint a supervising external accountant to run country’s third-largest health fund.

By
December 22, 2010 02:32
3 minute read.
Kupat Holim Meuhedet

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

Health Ministry director-general Dr. Ronni Gamzu sent a 15-page letter to the chairman of Kupat Holim Meuhedet’s board of directors on Tuesday night, demanding that it fire director-general Shmuel Muallem and six other leading executives.

The chairman, Rabbi Yerahmiel Boyer, was told in the strongly worded letter to respond within 21 days.

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If the board does not dismiss the senior executives highlighted in the state comptroller’s special report alleging corruption, nepotism, waste, flagrant mismanagement, bribery, conflict of interest, nonexistent accountability and concealment of documents, the ministry has the right to appoint a supervising external accountant to run the country’s third-largest health fund and fire whomever he wishes.

Boyer stated in response that he had received the letter and would convene the board “urgently to discuss it and prepare Meuhedet’s response within the time limit” set down by the ministry.

Aside from Muallem, the officials listed are chief financial officer Gil Haimovich, chief pharmacist George Shriki, Judea region head Zvi Hertz, Jerusalem director and former marketing director Yehuda Eliash, internal comptroller David Somech, and a member of the board’s control committee.

According to ministry sources, the other board members wield less power than the executives, so at this stage the chairman and other colleagues have not been asked to fire themselves.



The health fund is holding elections for a new board in six months.

The comptroller’s report, which called for the establishment of a state committee of investigation on the health fund that insures over a million Israelis, was called an “earthquake” by health system experts, but so far the board has taken minimal action. It recently said it intended to dismiss four members – not including Muallem – but has not yet done so.

Copies of Gamzu’s letter were also sent to Prime Minister Binyamin Netanyahu, who officially holds the portfolio of health minister; Deputy Health Minister Ya’acov Litzman; Attorney-General Yehuda Weinstein; State Comptroller Micha Lindenstrauss; and other officials.

The alleged illegal dealings are believed by the State Comptroller’s Office and others to have involved hundreds of millions, or even billions, of shekels and dozens of administrators, including Muallem and his predecessor, Uzi Salant, who headed the fund for 30 years and received a huge pension.

According to annual Treasury reports, senior health fund administrators, including those at Meuhedet, are among the highest-paid people in the public sector, with salaries reaching NIS 60,000 a month and more.

Gamzu wrote in the letter that health fund executives held a public trust and were bound to run the funds in the most efficient and honest way possible for the benefit of members and their health. This obligation, he continued, was the “Holy of Holies.”

But the Meuhedet executives failed to do so, he said. The fact that the police are investigating the allegations does not mean that the board cannot already make decisions regarding executives, he declared.

The ministry was not satisfied with the protocols of Meuhedet board meetings issued after the publication of the comptroller’s report, showing that the board had not taken relevant decisions. The ministry therefore gave orders to dismiss the officials.

Muallem’s behavior not only showed that he wasn’t professional and careful, but also caused significant financial damage to the health fund and violated members’ trust in the organization, Gamzu wrote.

The board of directors decided after the report was issued to cut the salaries of senior executives by 5 percent, but even that was not implemented, Gamzu went on, declaring that Muallem and those reporting to him must not have any link – logistical, financial, organizational or operational – with Meuhedet’s future elections so they do not influence the way they are held and how they turn out.

No new contracts relating to marketing, advertising or promotion will be allowed unless they are approved by the accountant appointed by the board, and by Meuhedet’s legal adviser, he continued.

The health fund’s entire structure will have to be changed so that it is run like a corporation, with supervision by independent experts, and not according to the current setup where managers supervise themselves, he concluded.


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