Late last month, Israel’s Ministry of Health detailed a two-year plan for expanding the country’s mental health services. The discussion was held during a meeting of the Knesset Health Committee and revealed significant changes which seek to properly treat a larger quantity of patients while dealing with the shortage of personnel. Israel’s mental health care system is complex and each change is expensive, raising concerns that the plan might do more harm than good. The government has designated 1.4 billion shekels ($390 million) for the plan, with an increase to the health tax helping provide the funds.
Speaking to the committee, Oreli Malka, pricing and accounting manager at the Ministry of Health, proposed five principles meant to improve care without breaking the bank: encouraging short-term and group therapy, investing in technologies to provide solutions without adding strain on human resources, strengthening community-based solutions like halfway housing rather than hospitalizations, increasing the amount of psychologists and psychiatrists through wage agreements, and adjusting the psychiatric inpatient system to hold more short-term patients.
In order to strengthen the community response, Israel’s health care funds received 660 million shekels ($184 million) in 2024 to support mental health services. They’re set to receive that amount again in 2025. Additionally, more than 350 caregiver positions were recruited to work in the mental health field.
According to the Ministry of Health, demand for mental health care increased dramatically in 2024. In the last year, the number of days spent in halfway housing grew by 90% from the previous year and the number of days in home care grew by 30%. The number of psychotherapists serving the country grew as well, but not by as much—only by 20%.
This year, new halfway houses are expected to be developed, and each health care fund is expected to create an emergency response team for mental health crises. Some funds have also started employing “resilience coaches,” therapists with bachelor’s degrees who provide short-term, targeted treatments for specific problems.
In addition to the budget for health funds and wage agreements, the new plan is based on changes in the pricing mechanisms of the psychiatric hospitalization system with the aim of shifting financial incentives.
The health funds currently pay a low price for each day of hospitalization. The Ministry of Health claims that this model creates an incentive for the hospital to maximize hospitalization days, sometimes even among patients who can be discharged, in order to increase revenue. On the other hand, the ministry estimates that from the health funds’ perspective, the price of psychiatric hospitalization is lower than a solution that replaces hospitalization such as halfway housing would be, and therefore the fund has no incentive to develop alternatives and remove patients from prolonged and unnecessary hospitalizations.
According to the new billing model proposed by the Ministry of Health, the hospital will receive a fixed, known amount in advance for each hospitalization bed, regardless of the actual number of days of hospitalization. The amount will be divided among the health funds in proportion to the days of hospitalization of their insured persons as a percentage of all days of hospitalization in the department during the year. Along with the change in the accounting model, the amount of payments to psychiatric hospitals will increase from 1.7 billion shekels ($473 million) in 2023 to 1.8 billion shekels ($501 million) in 2025, and payments to psychiatric departments in general hospitals will increase from 221 million shekels ($62 million) in 2024 to 274 million shekels ($76 million) in 2025.
This article was translated from Hebrew by Hannah Blount.
