What the US healthcare system can learn from Israel

Rethinking Healthcare Reform: Lessons Learned from Israel

In what seems like a lifetime ago, the United States Congress in 2010 passed and President Obama signed into law the Affordable Care Act (ACA). While the Act is certainly complex and remains the fodder of heated political debate, the basic intent of the bill is to make healthcare more widely accessible to the tens of millions of Americans who do not currently have health insurance.  The centerpiece of the ACA is the requirement that citizens purchase health insurance either through their employer or through one of several insurance exchanges.  It is reasonable to ask how a system like that might work and how other nations who have adopted similar programs have done relative to health outcomes, consumer satisfaction and eliminating or reducing health disparities.  While a number of industrialized nations provide health care through a single payer (government run) system, others have made a public-private system the model they use to guarantee health services to all their citizens. One of those nations is Israel which (as it turns out) has a lot to teach the United States on how to operate a universal health system that is based on both private and public inputs.

In close cooperation with the leadership and faculty from the Hebrew University of Jerusalem, Hadassah Hospital, and the Braun School of Public Health, seven students and two faculty members from the George Washington University School of Public Health and Health Services recently completed a two week study tour of Israel’s healthcare delivery system. The objective of the study tour was to allow these future healthcare leaders the opportunity to critically examine the organization, financing and delivery of health services throughout Israel. Through a combination of classroom and field based learning, the students discovered the following:

  • ·         Israel adopted its national health system in 1995 requiring all permanent residents be provided a standard basket of services including physician care, hospitalization, prescription drugs and dental care for children
  • ·         Healthcare is paid for by a combination of earmarked health tax payments, funding from the Ministry of Health and co-payments paid when services are delivered.
  • ·         Four “sick funds” or HMO’s act as the insurance plan for all residents. Persons can freely choose any of the sick funds and can access any physician or hospital in the plan. The sick funds may offer supplemental coverage that is highly regulated.
  • ·         Health coverage for every resident of Israel is accomplished for 8.7% of GDP in contrast to the US cost of 17.6% where there are almost 51 million without health insurance
  • ·         By virtually all commonly used indicators including life expectancy and maternal and child health measures, Israel far outperforms the US.
  • ·         An electronic health record ties together all the patient information for each of the four health plans and is accessible to physicians, hospitals and patients
This is not to say that the healthcare system in Israel is flawless and could not be improved.  The out of pocket costs to consumers continues to rise, there remain a number of critical health disparities particularly Israeli Arabs and peripheral populations and last year a 158 day physician strike over wages and working conditions revealed that provider working conditions must improve.

Despite the problems in Israel’s system, there are a number of important observations our students made that can have direct application to the United States and the implementation of the ACA including:
  • ·         Cost control is essential particularly with respect to the payment to physicians and the reimbursement to hospitals.
  • ·         The patients and their health and well being are at the heart of the Israeli system. Here in the US, the physicians, hospitals and commercial health insurance all believe that the system exists for their benefit.
  • ·         An integrated electronic health record available to every one of the patients in the four HMO’s in Israel serves to reduce waste and duplication, gives physicians immediate access to clinical information and helps drive rational administrative decisions.  We are moving in this direction but progress is slow and uneven
  • ·         The national standard basket of services assures that all patients, regardless of the HMO they choose, are guaranteed a uniform basic set of health services, which supports social cohesion.  Allowing each of the states to determine what services will be covered under the ACA forgoes this cohesion.
Perhaps the most important lesson learned by our students is the level of support that exists in Israel particularly around healthcare delivery.  There is an overt and covert sense that everyone is in this particular boat together and that it makes sense for everyone to have access to healthcare. In the end, this is what the ACA is trying to accomplish. All we need do is look to a small nation on the Eastern Mediterranean for an example of how to do this right.