Israel Has Rx for U.S. Health Care


Israel and the United States each have successes and failures in their respective health care systems, but the younger of the modern nations, rooted in its tradition of helping the needy, has much to teach its American ally. When it comes to some of the most important issues facing the American health care system today — universal health care, administrative costs and establishing a national health basket of services — America can look to Israel.

Until 1995, health insurance in Israel was voluntary, although 99 percent of the Jewish population and 97 percent of the Arab population were covered by four HMOs, the first of which was established at the end of 1911. This was a system wherein the insured members paid the HMO, and the employer made a compulsory payment to the National Insurance Institute.

Today in Israel, everyone is covered by health insurance. In 1994, the Israeli parliament passed a groundbreaking health insurance bill that made every Israeli resident automatically insured, no matter their age, financial status or religion. In the United States today, more than 43 million people, including 12 million children, are uninsured.

Israel’s universal health care is characterized by its "national health care basket," which defines the range of services to which every resident is equally entitled. Residents can petition a labor court if they believe an HMO has ignored their rights to a medical service.

Universal access to Israel’s national health care basket means that there is no underinsurance in Israel, which happens when there are gaps in coverage. In the United States, more than 100 million citizens are underinsured — including 40 million with Medicare, 50 million with Medicaid and at least 10 million who are employed in large companies that have self-insurance.

The main health care delivery system for all Israelis is through primary and secondary clinics. These clinics, which are present throughout the country, provide easy and efficient access to care.

The clinics that belong to the HMOs enable quick access to primary medical care and also easy referral to specialists without waiting lists. There is continuity of care, while there is now a tremendous effort to computerize all the medical data.

Ninety-five percent of general care hospitals in Israel are public. There is no wait for diagnostic examinations such as MRI and CT or for procedures such as open-heart surgery. Payment for hospitalization is the responsibility of the HMO, and there is no deductible or co-insurance payment required of the patient.

There is a $3 co-payment for each prescription on the approved drug list covering acute and chronic diseases.

High unemployment and the Israeli economic recession make it difficult for about 10 percent of the population to pay even this, even though there is a $50 biannual co-payment cap.

Caring for the elderly is a core social policy and an integral part of health care in Israel. While in the United States geriatric care is handled by Medicare, in Israel it is part of the health basket and is the responsibility of the HMOs.

Only hospitalization in nursing homes is the responsibility of the Ministry of Health for those who cannot afford to pay for private insurance or from their own means. Geriatric care, being an integral part of health care in Israel, is of high quality.

I do hope that one of the Israeli government’s priorities in an improved economic situation will be to reflect the nation’s social values by exempting the poorest 5-10 percent of the population from drug co-payments.

Israel’s health indicators for longevity and infant mortality are better than those of the United States. This aspect is not unique to Israel, but many Western countries are better in the various indicators of health than the United States. Yet while Israel spends 8.8 percent of its Gross National Product on caring for the elderly, the United States spends 15 percent of its GNP.

In international comparisons of health care systems, Israel ranks among the top 20 in the world. But, even with its favorable standing, Israel faces many challenges, such as the financial limitations of introducing new technologies and prescription drugs to the health basket and the high taxes Israelis pay. Also of concern are high out-of-pocket expenses for cost sharing and for health care services that are covered only by complementary insurance.

Israel’s health care system, while based on the core value of access for all, is still evolving. The establishment of a "health parliament," a private initiative endorsed by the government, enabled input from ordinary Israelis to help set priorities for the future, including the challenges of limited resources and the growing gap between rich and poor.

Obviously, Israel and the United States differ vastly in size, making full comparisons limited. But with the exception of four large states, Israel is similar in size to most U.S. states. The American health system can be improved only if states take responsibility for health care, or, in the case of the four largest states, if there is regional responsibility within the state.

In 2003, the United States spent at least 30 percent of its national health expenditures on administration, while Israel spent less than 10 percent. The United States could have saved at least $280 billion of the $400 billion spent in administrative expenditures in 2003 to cover the uninsured and to close the gap of the underinsured, strengthening the democratic principles it holds dear.


Professor Mordechai Shani is the director general of Sheba Medical Center at Tel Hashomer, Israel’s largest hospital. He served twice as director general of the Ministry of Health, including 1994, when the Insurance Bill and the Patients Bill of Rights were passed by the Knesset.

Planning Ahead Can Save on Health Care


Eva, 74 and a widow, was a healthy and independent woman until she went shopping one day last December and was mugged. She was attacked with a screwdriver and thrown to ground, breaking her shoulder in four places.

"I ended up on the sidewalk, totally helpless," said Eva, who lives in Westwood and prefers to not give her last name. "I went from being very active to being disabled. My recovery was very painful, and I am still not done."

Eva was hospitalized for a month, and when she came home, she found that she needed nursing care and help doing basic tasks around the house, such as bathing and getting dressed.

"A nursing home just didn’t appeal to me," Eva said, and so she found home care. The cost of such care was between $17 and $20 an hour, and Eva needed it at least 16 hours a day for six months.

The cost of her care could have totaled in excess of $55,000 for those six months. However, Eva was able to avoid the expenditure because she had a long-term-care insurance policy that she bought the year before. The premium cost $2,273.

Because elder care can be an enormous drain on an individual’s resources, with nursing homes costing in excess of $100 a day and home care costing even more, planning ahead and buying long-term-care insurance is one way of preventing the costs from being too overwhelming.

For some in the Jewish community, long-term-care insurance — and particularly the home-care policies — can also have a religious significance. They see it as a facet of the mitzvah of Kibud Av V’em (honoring one’s parents), because it allows children to have peace of mind about their aging parents living out their last years with dignity.

In a 1998 article written by Joel Schwartz in the Association of Orthodox Jewish Scientists Newsletter, Schwartz argued that according to Torah, home care is preferable to nursing-home care, because institutionalized living brings with it a certain loss of honor. While some nursing homes are cheery and bright, others may be drab, unfriendly and, in some cases, even detrimental to the health of those who need care.

Government regulations require nursing homes to provide 3.2 hours of care per patient per 24 hours. In some cases, a nursing home might cut corners because it does not hire enough staff to meet the requirement.

In such a scenario, which some experts in the field say is not uncommon, patients who are severely incapacitated will suffer. They said bed-ridden patients might develop bedsores, because they are not turned often enough, and incontinent patients might be diapered to save labor costs.

Few people want their parents to suffer such problems, but many with aging parents have their own families to provide for and do not have the time or resources to take proper care of their parents themselves.

For many people, long-term-care insurance provides the answer to the problem. Although the premiums might appear high — and even seem useless if the person paying them is healthy — they can end up saving people tens of thousand of dollars if the need for long-term care should arise.

Karen Shoff, a Santa Monica gerontologist, insurance agent and author of "There’s No Place Like a Nursing Home: Four Powerful Steps That Will Change Your Life" (Invisible Ink, 2002), believes that planning for one’s physical retirement is as important as planning for one’s financial retirement. Shoff advises people to start planning for their twilight years in their 50s and 60s, so that they will be able to avoid both nursing homes and the costs involved with home care.

Shoff’s plan involves buying a long-term-care policy, appointing a geriatric-care manager who can assist with legal and medical issues and find services, making a living will that spells out how a person wants to be cared for in the event of an illness and finding an ally who will help carry out the plans.

"You can’t wait until the fire’s there, and people are tearing their hair out," she said. "You need to plan ahead logically."

However, there are some who shy away from long-term-care insurance because they see it as unnecessary to pay premiums above and beyond health insurance and Medicare, which they believe will cover most emergencies. Furthermore, many people argue that, depending on the circumstances, nursing homes can provide better service and offer a wider variety of resources than a home care, in addition to having a social setting that might not be available at home.

"There is an understanding in halacha [Jewish law] that sometimes a parent needs to be put in an institution — for example, if the parent has dementia, and the children can’t handle the burden" said Rabbi Elazar Muskin of Young Israel of Century City. "You need to weigh up the circumstances."

Still, others credit their long-term-care insurance and the home care it bought them with peace of mind. "When I took out the policy, my children kept telling me that I was throwing money out the window," Eva said. "But after I was mugged, they were relieved that I had this help, that I was OK and that I was not going to be dependent on them."

California Pressures Insurers to Settle Holocaust-era Claims


California’s top officials, legislators and private organizations are throwing their collective weight behind a series of measures aimed at pressuring European insurance companies into settling claims from the Holocaust era.

The charge is being led by Gov. Gray Davis and state Insurance Commissioner Chuck Quackenbush. Speaking at a news conference last Friday, they pledged, in Davis’ words, to “begin a sacred pilgrimage to bring healing and hope to those victimized not once, but twice. We will do everything possible to seek justice for Holocaust victims, survivors and their families.”

At the conference, held in the Simon Wiesenthal Center, Davis also warned insurance companies “to pay now, or we guarantee you will pay more later.”

State Sen. Tom Hayden handed Quackenbush a petition that called for the suspension of 64 insurance companies practicing in California which have failed to honor Holocaust-era claims.

To enlist public support, Davis announced the formation of the California Holocaust Insurance Settlement Alliance, which consists of 25 organizations and individuals.

Quackenbush announced the creation of a Web site — www.insurance.ca.gov — and a toll-free phone line — (888) 234-4636 — to help potential claimants. His office is placing ads in some 30 general and Jewish newspapers in California, each ending with the line, “It’s about restitution, it’s about justice and it’s about time.”

The California Insurance Department will mail restitution application forms to Holocaust survivors and their families throughout the state.

The effort is intended primarily for the estimated 20,000 Holocaust survivors in California, but information is also available to the other 120,000 to 140,000 survivors throughout the United States. It is believed that there are up to 860,000 survivors worldwide.

In a series of hearings hosted by U.S. insurance commissioners last year, numerous witnesses charged that the European insurers have been stalling for 50 years to avoid payment on policies taken out by Jews in prewar years.

Based on its research into the unpaid policies, the World Jewish Congress has put their value at between $2 billion and $2.5 billion in today’s currency — 10 times their value in postwar dollars.

Recently enacted state laws have empowered California courts to deal with claims against European insurance companies doing business in the state and for officials to withdraw the licenses of uncooperative companies.

Currently, subsidiaries of six major insurance companies are collecting billions of dollars in premiums in California, Hayden said. They are: Assicurazioni Generali of Italy; Germany’s leading insurer, Allianz Holding; France’s AXA Group; and the Winterthur, Zurich and Basel insurance firms in Switzerland.

Quackenbush said he is hopeful that the California actions will encourage the six companies, plus 13 others operating in California, to reach a fair and speedy settlement.

“When they feel the heat, they’ll see the light,” he said.

Implicitly, Hayden said in an interview, some of the pressure is also directed at the International Commission on Holocaust Era Insurance Claims, which was to meet this week in London under former U.S. Secretary of State Lawrence Eagleburger.

Hayden said both Eagleburger and Undersecretary of State Stuart Eizenstat, the Clinton administration’s point man on Holocaust reparation issues, have opposed action by individual states against European insurance companies.

But Hayden maintains that only the threat of losing lucrative business in California and other states will persuade the firms to settle the claims.

60th anniversary of Kristallnacht


November 1998 will mark the 60th anniversary of Kristallnacht. Sixty years have passed since the beginning of one of human history’s darkest moments and even now we find ourselves still pursuing justice for the victims of the Holocaust.

Last week Gov. Pete Wilson signed into law Senate Bill 1530 authored by Tom Hayden (D-Santa Monica). The bill calls upon the California Department of Insurance to investigate and assist Holocaust survivors in obtaining unpaid insurance claims. Under this measure, insurers that refuse to pay valid claims would face the loss of their license to do business in California. We applaud Sen. Hayden for bringing this important issue before the people of California and the governor for seeing the importance of the issue.

SB 1530 is an important first step. Unfortunately, Gov. Wilson vetoed Assembly Bill 1715 (written by Wally Knox), legislation that would have required the establishment of an insurance policy registry by those insurance companies that handled the bulk of European insurance business between 1920 and 1945.

Additionally, AB 1715 would have revoked the license of any insurance company (or its subsidiary) operating in California if this essential information was not made publicly available. Because so many years have passed since the Holocaust and so many insurance policies were lost (or even discarded by heirs who believed them worthless), the creation of such a registry and its widespread availability is absolutely necessary for beneficiaries and their heirs to determine that their families indeed had obtained personal and/or business insurance policies that have remained unclaimed.

Here’s what we ask of insurance companies: Show us your lists of names of insurance policy holders and beneficiaries! Make them available on the Internet, publish them in the newspapers and demonstrate that your corporations believe in justice!

There are some people who know their parents or grandparents had insurance policies. Some may even have documentation. Sen. Hayden’s legislation will assist these people, but the vast majority of survivors and heirs, now 50 years after the war’s end, do not know if such policies even existed and, if so, who the beneficiaries were. The European insurance companies, which wrote those policies in pre-war years, do have that documentation. Now they can right a wrong by publishing the names of policyholders and beneficiaries!

In California, the Italian Generali Insurance Co. and the Equitable Insurance Co. (a subsidiary of the French AXA Insurance Co.) have been involved in lobbying the state Legislature in connection with wartime insurance policies. It is time for them and for others, such as the German Allianz A.G. (who operates in California via its Fireman’s Fund subsidiary), the Swiss Zurich, Baloise and Winterthur insurance companies to come clean and make public the names of those who had policies with them or their subsidiaries. Then justice will be served, the wrongs of the past made right. Insurance companies, show us your lists! Let justice prevail.


Arthur Stern is the chair of the Commission on World Jewry. Michael Hirschfeld is executive director of the Jewish Community Relations Committee.

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