Clinic Decentralization: An Israeli Model and Evaluation Strategy

Abstract

KHC is Israel's dominant provider and insurer of primary care services. It operates about 1,300 clinics and employs over 2,300 primary care physicians. KHC also owns eight acute-care hospitals, three psychiatric hospitals and three geriatric hospitals. Approximately 75 per cent of Israel's population are insured through KHC, another 20 per cent through three smaller health insurance funds, while 5 per cent of the population is uninsured [6].At present, KHC has a centralized organizational structure: central management defines overall policy, allocates itemized budgets to its 14 districts and 14 hospitals, and supervises their activities. Each district has a district management responsible for the district's budget and for supervising its community clinics, specialty clinics, laboratories and diagnostic centres. District management is responsible for determining the drugs which physicians can prescribe, the hospitals and diagnostic centres to which they can refer patients, and clinic operating policy.The community clinics are staffed by physicians, nurses, administrators, pharmacists and, in some cases, specialists. Some clinics also operate a laboratory. The clinic itself is managed by a team comprising a physician, a nurse and an administrator. The clinics provide services, but have little autonomy. They do not determine staff employment, operating hours or the scope of services offered by the clinic, nor do they have any fiscal responsibility.Over the years, KHC' s deficit has grown and its membership has declined[7]. KHC' s decentralization programme is, in part, a response to mounting difficulties in containing costs, and increasing competition from other health insurance funds.The main objectives of decentralizing KHC clinics in the Negev district are to:(1) improve services, with the aim of increasing client satisfaction and attracting more members; (2) make more efficient use of existing resources by introducing budgetary responsibility at the clinic and physician levels; and (3) upgrade the functioning of clinic staff by increasing individual motivation, responsibility and initiative, and by improving morale.

Decentralization in a sick fund: lessons from an evaluation

“…As of 1995, approximately 65 per cent of Israel's population were insured by KHC, and the remainder by three smaller sick funds. The service-delivery model of KHC, as of the other sick funds in Israel, resembles that of HMOs in the USA; that is, the sick funds are responsible for providing services to their members, either through their own care facilities or through contracted providers [12][13][14].…”