Comparative Analysis Of Healthcare Systems In The US And Israel

The purpose of this paper is to outline the distinction between the U.S. healthcare system to Israel, a Middle Eastern healthcare system. In this paper, I’ll be comparing the following: causes of mortality, cost of care per capita/health outcomes, challenges that healthcare systems are facing, health professional licensing and more. Afterwards, I’ll conclude with my thoughts about each.

According to the CDC, the top 5 primary causes of death in the United States include heart disease, cancer, accidents, chronic lower respiratory diseases and stroke. This mainly due high obesity rates, diabetes, smoking, high alcohol intake. According to the, the top 5 primary causes of death in Israel are heart disease, Alzheimer’s disease, stroke, lower respiratory diseases and chronic kidney diseases. Both countries have similar primary causes of mortality with the outliers being Alzheimer’s and kidney disease but are within the top 10 primary causes of death in the United States. Both countries are suffering from high rates of diabetes which makes people more susceptible to other diseases forming rather quickly as well as causing infections and wounds not healing properly. In terms of risk factors, the top 5 factors that affect mortality in both countries include: high fasting plasma glucose, tobacco, high body-mass index, high blood pressure, and dietary risks.

In 2017, the OECD, Organization for Economic Co-operation and Development, reported that the cost of care per capita in the United States is $10,201 while Israel’s cost of care is $2,834. The reason the United States is so costly is due to the following: “higher hospital spending, ambulatory care, pharmaceuticals/medical goods, and public health and administration”. Israel has universal healthcare therefore individual spending is less in addition to their population being considerably less compared to the United States.

In 2012, an important program was developed to aid health outcomes. Israel established its first national call center called MOMA developed by Maccabi Healthcare Services and the Gertner Institute “for the treatment of a range of chronic conditions, in coordination with the client's primary physician and other community-based resources.” As a result, diabetes has been better controlled, there was a 40% decrease in depression, decreased hospitalization & successful homecare while treating 11,000 patients so far.

Mental health disorders make up 32% of years of disability worldwide and increase rate of morbidity. In 2015, Israel added mental health to all healthcare plans making it available to all its citizens. This was done due to connections seen between physical health and mental health. In the United States, Mental Health America reported a decrease of adults with mental health problems.

There are three notable challenges that the Israeli healthcare system is facing according to the OECD: “Regions with the greatest health care need are under-served by health care services”, “Quality of hospital care is affected by a high occupancy rate of beds” and “lowest number of new graduates relative to the population”

Areas with a greater need of healthcare are face shortages in personnel, beds and equipment. Because of this, in addition to a percentage of funds not being available to those in need, the problem will only continue to grow. In terms of hospital beds, Israel has a rate of 3.2 per 1,000 people which is far less than the OCED average of 8.8. A notable statistic is Israel’s 94 percent occupancy bed occupancy compared to that of the OCED average of 77 percent. Professor David Chintz of Hebrew University spoke at a policy seminar at the University of Pennsylvania's Leonard Davis Institute of Health Economics and stated that “The average length of stay is four days; occupancy rate is 98% and during the flu season it rises to 115% as an overflow of patients are housed in the hallways”.

The United States is facing a similar challenge, that being a shortage of healthcare personnel. According to Mercer, a global health care staffing consultancy, by 2025 the U.S. will likely face a shortage of 446,300 home health aides, 95,000 nursing assistants, 98,700 medical and laboratory technicians/technologists and 29,400 nurse practitioners. This is primarily due to the baby boomers living longer and taking better care of their selves due to the advancements made in healthcare. A healthcare difference that United States faces that isn’t as prevalent in Israel is the exponentially high costs all around. Taylor Tyler, author/writer of Independent Voter Network, wrote that “the United States is 5 percent of the world’s population but accounts for 42 percent of the global prescription drug spending.” In addition the government cannot negotiate prices of prescription drugs giving freedom to drug makers to price their product however they please. Another challenge that the U.S. faces is administrative costs. Harvard economist, David Cutler, states that the number one reason our healthcare costs are so high is “the administrative costs of running our healthcare system are astronomical. About one-quarter of healthcare cost is associated with administration, which is far higher than in any other country.” An example he gave was with Duke University Hospital employing 1,300 billing clerks which has only 900 beds and how those billing specialists are needed to determine how to bill to meet the varying requirements of multiple insurers. Cost in countries with universal healthcare and with a single-payer systems are dramatically less since such staffing isn’t as compulsory therefore allowing money to be used to better serve the patient and/or to better enhance resources.

Currently, Israel is going through a health workforce crisis to where the demand of the population is not being met. “In 2013, Israel had 3.3 practicing physicians per 1000 population” and “about half of them are aged 55 years and over and will retire soon. The number of nurses is already low, with around 5 nurses per 1 000 population” as reported by the OECD. In addition, the number of medical and nursing graduates are not keeping up with the demand of the population as well. In 2013, Israel average 5.1 medical graduates per 100,000 people and 22 nursing graduates per 100,000 people. Lastly, because the public sector is less lucrative than the public sector, “the differences in pay between the private and public systems complicates the recruitment and retention of public doctors in the public sector”

In Israel, the Ministry of Health oversees all aspects of health. Within the ministry, the Medical Professions Licensing Division has rules and responsibilities to abide by. It is responsible for fulfilling the healthcare policies relating to the licensing of the “professional status of those specializing in the health care professions.” In addition, it “sets the standards for all matters related to the professional licensing of health professionals in Israel, including training, internships, specializations, examinations, and qualification courses. Initiates amendments, changes and additions to the laws and regulations relevant to licensing.” Lastly, Medical Professions Licensing Division represents the Ministry when participating on several health committees and activities while being a “recommending authority on matters concerning health profession discipline, as per each specialization.”

In the United States, medical professionals are to go undergo secondary collegiate schooling which is a form of some specialized area: dental, pharmacy, nursing, etc. After graduating, students are to take a state board examination and pass which a certain percentage in order to be appropriately licensed. This varies state by state due to individual laws each has as it relates to licensing.

In 1995, Israel passed a national health insurance (NHI) law, which provides for universal coverage. There are four competing, nonprofit health plans which are budgeted through capitation. Because Israel has universal healthcare, all citizens and permanent residents have publicly financed health insurance coverage through the Ministry of Health via the government. The way this is funded is by a unique income related tax combined with government revenue. There is also private health insurance called Private Voluntary Health Insurance or “VHI. VHI provides addition healthcare that is not provided but the NHI such as certain medications, dental care, and long term care.

Copayments are the only the payments made to the NHI providers. Hospital outpatient care is “reimbursed on a fee-for-service basis, and inpatient care is reimbursed using a mix of per-diem and activity-based diagnosis-related group (DRG) arrangements, with approximately two-thirds of revenue coming from per-diem payments.”

In the United States, healthcare is primarily publicly funded through either Medicare or Medicaid. differentiated the following:

Medicare Characteristics:

  1. Paid for by payroll taxes.
  2. Distributed by the federal government to individuals over the age of 65, with disabilities, and other qualifiers.
  3. Eligibility determined by federal government.
  4. Federal government sets coverage and negotiates with private and public health care providers to determine eligibility.

Medicaid Characteristics:

  1. Paid for by state and federal taxes.
  2. Distributed to individuals by the states within broad federal guidelines.
  3. Eligibility determined by states, following some federal standards.
  4. State governments set coverage within national guidelines and negotiate with private and public health care providers to determine eligibility.
  5. State Children’s Health Insurance Program (SCHIP) is an expansion of Medicaid and covers children in families deemed underprivileged who do not qualify for Medicaid based on income.

According to “In 2014, public spending accounted for about 49 percent of total health care spending” compared to “private health insurance spending being 39 percent of total health care spending.”

In my opinion, the Israeli healthcare system is very ideal and the main problem they face is the lack of healthcare professionals and shortages of healthcare equipment. Their healthcare spending is adequate and the private healthcare system is tact. With advancements made in tele-health, I see the Israeli health systems progressing for the better. The problem I see with the United States healthcare system is that there is too much spending on healthcare and the results are not meeting the expectation. In addition, I feel that the government should step in and regulate the costs of prescriptions which would in turn allow for more patients/consumers saving money.

Sources Used

  1. “An Overview of Israel's Universal Health Care System.” LDI, 1 Aug. 1970,
  2. HEALTH POLICY in Israel. OCED, Apr. 2016,
  4. S. Brammli-Greenberg, R. Waitzberg, V. Perman et al., “Why and How Did Israel Adopt Activity-Based Hospital Payment? The Procedure-Related Group Incremental Reform,” Health Policy, Oct. 2016, 120(10):1171–76.
  10. Vigo D, Thornicroft G, Atun R. Estimating the true global burden of mental illness. Lancet Psychiatry2016;3:171‐8. [PubMed}
  13. Taylor Tyler, 'Direct-to-Consumer Drug Ads Should Be Scaled Back, Doctors Say,”, June 3, 2013
  18. 7T. Rice, P. Rosenau, L. Y. Unruh et al., “United States of America: Health System Review,” Health Systems in Transition, 2013 15(3):1–431.
09 March 2021
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