This presentation by Arnon AFEK was made at the 3rd Joint DELSA/GOV Health Meeting, Paris 24-25 April 2014. Find out more at www.oecd.org/gov/budgeting/3rdmeetingdelsagovnetworkfiscalsustainabilityofhealthsystems2014.htm

1. Challenges in the wage
negotiation in Israel

2. • Universal coverage by The National Health Insurance law since 1995
• Bismarckian system – 4 HMOs, capitation formula
• Hospital sector includes 24 general hospitals
• System is highly controlled, under-budgeted and subsidized by MOF
• National health expenditure – 7.7% (stable since 1995)
• Acute care beds – 1.9 (OECD avg. – 3.4), per 1,000 pop., year 2011
• Medical graduates – 4.9 (OECD avg. – 10.6), per 100,000 pop., year 2011
• Physicians – 3.3 (OECD avg. – 3.2), per 1,000 pop., year 2011
Israeli Healthcare System at a Glance

3. “Israel has established one of the
most enviable health care systems
among OECD countries…”
OECD Reviews of Health Care Quality: Israel 2012

4. Medical Education in Israel
• 5 medical schools
• 700 medical students (in the past only 400)
• 2 medical programs: 6 year & 4 year
• Mandatory rotational internship
Source: OECD DATA

5. Physicians in Israel (1)
Source: OECD DATA
New Licensed Physicians in Israel
years 1985-2012

6. Physicians in Israel (2)
Source: OECD DATA
Source: MOH

7. Israeli Medical Association (IMA)
• Acts as an independent, apolitical, professional organization
• The official physician workers union
• Negotiates with employers and signs physicians perennial
collective agreements
• Multiple roles:
 Union
 Scientific-professional (ethics)
 Medical association
 Advisory – Scientific board
IMA’s vision:
not only to act as a union,
but as Israel’s medical system protector

8. Summary
 In the last decade the Healthcare System resources are highly
regulated and limited by the MOF in order to maintain low
national health expenditures.
 This led to a shortage of medical graduates, physicians,
hospital beds, nurses.
 Physicians are represented by a powerful union.

9. Physician’s Strikes in Israel - History
• 1976 - lasted 58 days, first strike
• 1983 - lasted 117 days, hunger strike, physicians left hospitals
• 1994 - lasted one day
• 2000 - lasted 217 days, collective agreement for 10 years
• 2011 - lasted 242 days
(1950 - 1990: IMA declared on 20 strikes and labor disputes)

10. Physician’s Strike in 2011 (1)
• The beginning:
 Expiration of labor agreement from last strike (2000)
 Negotiation for a new labor agreement failed
• The players :
 Employers: Clalit HMO, Government, Hadassah Medical Org
 Employees representative: IMA with powerful leaders,
hospitals department heads, (residents?) Consultation with
experts (Deloitte)
• High expectations

11. Physician’s Strike in 2011 (2)
• The longest strike
• Acting on the edge - partial work sanction, threats to abandon
hospitals
• Hunger strikes
• Israeli Labor Courts were highly involved
• Extensive supportive media coverage
• Publicized march to Jerusalem

12. The unique agreement included:
• Major increase in salary (avg. increase )
• Major increase in salary of professions in need (up to 67%)
• Physicians in periphery were highly recompensed (up to 67%)
• Additional staff (1000)
• Report to work (“clock” ; serving vs. working)
• Major changes in working hours (a change of life style)
• The balance between physicians in leading central Hospitals vs
peripheral Hospitals.
• The agreement was signed for 9 years
• Hospital Directors were not a part of the agreement
signed & shattered)The First Agreement

13. Orthopedics Internal General Surgery Intensive Care
Center
Orthopedics Internal General Surgery Intensive Care
Periphery
Aug Dec
Salary of Young Specialist (Israel)
Before the agreement (2011) vs. final step of the agreement (2018)
in EUR/month

14. Residents, 2nd stage of the Strike
• Shortage of medical school graduates led to a heavy burden on
existing residents
• Changes in the power of the leaders of the IMA (Physician guild)
• Public & media support
• Demonstrations, rallies
• Reopening a wage agreement, first time in history
• Israeli Labor Courts
• During negotiation almost all residents
resigned
• Dead-end
• Mediation

15. A new agreement for residents:
 Major increase in salary
 Grants with a low tax rate (150 M EUR)
 Decrease of working hours - max 26 hours per shift, 72 hours per week
 Short shifts
 Max 6 shifts per month
 Reevaluation of the agreement in 2015
Residents, 2nd stage of the Strike
Results

16. Residents’ Salary (Israel)
Before the agreement (2011) vs. final step of the agreement (2018)
in EUR/month
Orthopedics Internal General Surgery Intensive Care
Center
Orthopedics Internal General Surgery Intensive Care
Periphery
Aug Dec

17. Specialist physicians salary
OECD countries
(2006=100)
ISRAEL
Source: OECD DATA

18. ISRAEL
Specialist physicians salary
relative to the avg. salary
(2006=100)
Source: OECD DATA

19. The Agreement led to major improvements
But All sides felt defeated (1)
• Strengthening peripheral parts of Israel
• Massive addition of beds and staff in hospital
• Some physicians earn twice as much as Israel’s Prime Minister
• Major benefits to residents (grants, decreased working hours)
• Specialist physicians salaries were highly increased
• Increase of physicians working in periphery
• Increase of physicians working in professions in need

20. The Agreement led to major improvements
But All sides felt defeated (2)
• Discontent about having to report to work ( the clock)
• Agreement signed for 9 years – No strikes!
• Deficits in Healthcare budget due to high salary payment
• Rising opponents against the union (IMA)
• A few residents filed a spiteful lawsuit

21. The Future
• A change in the leadership of the IMA
• New struggle in 2015?

22. “Today he can discover his errors of yesterday and tomorrow
he can obtain a new light on what he thinks himself sure of
today.
Oh, God, Thou has appointed me to watch over the life and
death of Thy creatures; here am I ready for my vocation and
now I turn unto my calling.”
From the Oath of Maimonides