Integrating public and private insurance in the Israeli health system: an attempt to reconcile conflicting values

The private health insurance market in Israel offers two voluntary products: the first, offered by the non-profit health plans (HPs), is referred to as supplemental insurance (SI); the second, provided by for-profit insurers, is known as commercial insurance (CI). Both types of cover play a complementary role, covering benefits excluded from the National Health Insurance (NHI) scheme such as dental health care for adults. They also play a supplementary role, providing faster access to care, greater choice of provider and improved amenities (in the private sector), and extended cover of services included in the NHI, such as more physiotherapy or psychotherapy sessions compared with what the NHI offers. The Israeli private health insurance market’s main distinctive feature is the very high levels of population coverage and dual coverage (almost all people who own CI also own SI). We observe two trends in the health care market: (i) the decrease in the public share of health spending in the last two decades, followed by a sharp growth in private activity and private health insurance coverage; and (ii) the growth of the private health insurance market accompanied by various negative impacts on the public system’s financial sustainabil-ity, accessibility and availability of services and quality of care. Analysis of the Israeli case highlights the complexity of integrating statutory and broad private (voluntary) health insurance. Integration efforts have created a range of, sometimes conflicting, incentives and dis-incentives, which have implications for achieving public policy goals such as choice, extended coverage, equity, solidarity and curbing government spending while maintaining a strong publicly financed health system.