DELSA/GOV 3rd Health meeting - Arnon AFEK

Challenges in the wage negotiation in Israel

• 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

“Israel has established one of the most enviable health care systems among OECD countries…”

OECD Reviews of Health Care Quality: Israel 2012

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

Physicians in Israel (1)

Source: OECD DATA

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20120

1000

2000

3000

New Licensed Physicians in Israelyears 1985-2012

Physicians in Israel (2)

Source: OECD DATA

Source: MOH

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

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.

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)

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

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

The unique agreement included:

• Major increase in salary (avg. increase 47%)

• 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)) 2011 The First Agreement

Orthopedics Internal General Surgery Intensive Care0

2,000

4,000

6,000

3,3333,926

3,333

4,4214,416

5,547 5,5476,040

Center

Orthopedics Internal General Surgery Intensive Care0

2,000

4,000

6,000

3,5674,183

3,567

4,6785,126

6,366 6,3666,859

Periphery

Aug 2011 Dec 2018

Salary of Young Specialist (Israel)Before the agreement (2011) vs. final step of the agreement (2018)

in EUR/month

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

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 StrikeResults

Residents’ Salary (Israel)Before the agreement (2011) vs. final step of the agreement (2018)

in EUR/month

Orthopedics Internal General Surgery Intensive Care0

2,000

4,000

6,000

3,2613,667

3,2613,914

4,2204,901 4,901 5,175

Center

Orthopedics Internal General Surgery Intensive Care0

2,000

4,000

6,000

3,3243,740

3,3243,988

5,0535,835 5,835 6,109

Periphery

Aug 2011 Dec 2018

Specialist physicians salaryOECD countries

(2006=100)

ISRAEL

Source: OECD DATA

ISRAEL

Specialist physicians salaryrelative to the avg. salary

(2006=100)

Source: OECD DATA

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

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

The Future

• A change in the leadership of the IMA

• New struggle in 2015?

“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