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19 March 2025 | Policy Analysis
New bundled payments for mental health care to increase availability and quality of care -
23 September 2024 | Policy Analysis
The National Mental Health Care Program -
30 November 2022 | Policy Analysis
Mental health care initiatives to improve access, quality, integrate care and reduce stigma -
26 March 2018 | Policy Analysis
Preparedness for mental health responses in emergency events
5.11. Mental health care
The current mental health care system is described here.[35] However, it is in the midst of a major reform effort, which is described in more detail in section 6.1.2.
Since the outbreak of the war on 7 October 2023, Israel has faced one of the most complex mental health (MH) crises in its history (See update “The National Mental Health Program”). The current change in payment mechanisms for outpatient MH aims to shift care from inpatient to outpatient settings, promote the development of high-quality services within general hospitals and integrate in- and out-patient care, along with physical and mental health.
Until November 2024, outpatient psychiatric and psychological care was paid for by bundled payments that covered one of three possible packages of services (known as “episodes of care”): diagnostic services, short-term treatment, and long-term treatment. Each episode included a minimum number of services, for example, “short-term treatment” included up to six consultations with a MH professional for adults and eight for children. The packages of services were paid prospectively, and there was a unique tariff for each package regardless of the types of service provided.
- New bundled payments aim at promoting outpatient MH care: From 15 November 2024, payments changed to a retrospective bundled episode of care package. Tariffs now vary according to the type of service provided. The new “package” includes 15 encounters and is valid for one year, but the final tariff is set retrospectively based on the type of care provided during these encounters – for example, individual psychotherapy, group psychotherapy, follow-up phone visit, remote psychotherapy and more. Once a “package” is fully used up, the patient’s needs are reassessed; the MH clinic sends a medical summary of the service provided during the package to the payer (health plan, HP) along with a treatment plan (if needed). If necessary, the HP issues a new “package of care” to continue treatment.
- Higher per diem tariffs and introduction of pay for quality (P4Q) payments for MH inpatient care: the MoH increased the MH per diem tariffs paid by the HPs, which were considered to be too low for hospitals to provide high-quality care. In addition, the MoH will directly pay P4Q payments to hospitals that meet quality indicators.
- The MoH will pay for “MH rehabilitation programs”, instead of the HPs. These services will be funded with earmarked funds allocated by the MoH.
- The reform aims to promote home hospitalization as an alternative to full psychiatric hospitalization through more flexible financial arrangements between HPs and hospitals.
- Exemptions from copayments for MH Emergency Room Visits: the HPs will fully cover visits to emergency rooms in mental health centres even if no hospitalization is needed.
References
MOH, CEO circular. (2024). Billing and accounting rules between the HMOs and the ambulatory system and the emergency medicine centers in the public hospitals in mental health – updates. Retrieved from: https://www.gov.il/BlobFolder/policy/mk06-2024/he/files_circulars_mk_mk06-2024.pdf (Hebrew).
Engel, S. (2025). “Dramatic change”: A new accounting model for the mental health system was approved in first reading. Retrieved from: https://www.themarker.com/news/health/2025-02-26/ty-article/.premium/00000195-4284-d05c-a39d-5b8ed8940000?_ga=2.250921158.1140934137.1741762467-1261424413.1741762466 (Hebrew).
Context
For decades, the supply of publicly funded mental health services did not meet the demand. The COVID-19 pandemic increased the need for mental health services significantly, resulting in longer waiting times. In addition, professionals prefer to work with privately funded patients, exacerbating the gaps between demand and supply in the public system.
Impetus for the reform
Israel entered the “Swords of Iron” war that stated on 7 October 2023 with a stretched and underfunded mental health system. The war has had a dramatic impact on the populations’ need for acute and long-term mental health needs. As per mid-August 2024, and before the intensification of the conflict against the Hezbollah, the MoH estimated that over 300,000 people need mental health care as a result of the conflict so far. Other estimates range between 80,000 and 500,000 people.
Main purpose
The mental health plan aims at increasing the availability of mental health workers to improve access to mental health services, and expand the types of care offered, with an emphasis on shifting care from inpatient to outpatient settings.
Content/characteristics
Medium-term responses → Diversification of mental health outpatient service delivery:
- Expanding community “resilience centres” and opening new ones: a joint program between the Ministry of Health, Welfare, Education, the Interior, the IDF, and municipalities.
- Expanding “balancing homes” to prevent psychiatric hospitalization → Patients stay in “collective houses” and receive mental health care from various professionals (for example, psychiatrists, psychologists, social workers); aim for 100 new homes in 4 years.
- Creating a new profession: mental health resilience coach → helping public facing professionals (for example, Social workers; Art therapists; Educational consultants; Medical student during the clinical years; Psychologists before their internship; teachers) to improve their mental health resilience.
- Creating more mental health clinics with diverse options of care: (intensive) day-care, crisis teams that provide care at the patient’s home.
- Training health professionals from various fields, particularly primary care, to provide different levels of mental health care
Long-term responses → Plan to expand mental health workforce and availability of services:
- Shifting workers from the private to the public system by raising the payments for psychologists who contract with the health plans
- Raising the salary of psychotherapists employed by HPs by up to 38%
- Increasing the payments for self-employed professionals treating patients funded by the health plans
- Training more psychiatrists: increasing specialty training from 80 to 150 graduates/year
- Grants (NIS 500–300K) for physicians who choose to specialize in psychiatry
- Extra grants for those working in underserved areas (the north and south districts)
- Increasing the budget and staff positions for outpatient mental health and resilience centres
- Adding 200 staff positions and improving the infrastructure of psychiatric hospitals
- Creating a new nursing specialization: specialist nurses in psychiatry, who will provide primary mental health care.
Implementation
Implementation of some of these initiatives started in October 2023, while this plan was being consolidated in parallel. Funding has incrementally been allocated since November 2023. Funding relies on a dedicated budget that partially comes from general government funds and partially comes from an increase in the earmarked mandatory health insurance contributions (the health tax).
Outcomes and evaluation
There has been no evaluation so far.
Authors
In 2015 a reform added mental health (MH) services to National Health Insurance (NHI), transferring the responsibility and funding of services from the Ministry of Health to the Health Plans (HPs). The reform also intended to broaden eligibility for services and to shift care from an inpatient or day care setting to a community outpatient setting.
What: To improve availability and quality of care, reduce stigma, promote and diversify outpatient care, coordinate with inpatient and primary care. Shift care from in- to outpatient settings.
Why: Low availability and access to MH services, no inpatient care capacity.
How: In 2022 many changes and initiatives were implemented to achieve these goals:
- “Balancing homes” is a new type of service designed to prevent acute psychiatric hospital admissions of patients with MH crises. The new service provides more intensive care than provided by day clinics. Patients are entitled to short inpatient stays (for example, a week) in “collective houses” that are visited by health professionals who provide mental health care. Professionals includes psychiatrists, psychologists, social workers, occupational therapists and persons with “lived experiences”. This service is currently being expanded from its pilot stage.
- Psychiatric home care is an initiative that substitutes inpatient care. Patients receive all services at home that would otherwise be provided in inpatient settings, such as twice-weekly physician-led care or a daily nursing visit. This service has been scaled up in the context of the COVID-19 pandemic, with HPs purchasing services from for-profit organizations.
- Crisis teams provide emergency care in outpatient clinics to avoid hospitalisations. This service was launched during COVID-19 and has been maintained. It is provided in a hybrid format (in presence and virtual visits) and is mainly used for children.
- Short-term emergency mental health phone visits consist of up to six phone calls with a mental health professional. This service is funded directly by the Ministry of Health. It is another example of a service that was initiated during the pandemic and that has been maintained. The operation of the service has also been taken over by the HPs. The service improves the personal resilience of MH patients.
- Eating disorder care teams improve integrated care at outpatient clinics and coordinate with GPs, psychiatrists, nurses and social workers.
- New outpatient mental health clinics have been opened.
- New digital services have been developed.
Despite the new initiatives and services, long waiting times are still a concern for patients, especially in the public system. These are mainly attributed to workforce shortages. Most psychologists prefer to work privately, as they can charge higher fees. In addition, the COVID-19 pandemic has resulted in a sharp growth in demand for mental health services and waiting times have increased in both the public and private systems (Samuel and Kagya, 2022 forthcoming).
Care for substance abuse is not covered by the NHI and is still under the direct responsibility of (and funded by) the Ministry of Health. The main barrier to adding this service to the NHI is a lack of suitable professionals.
Authors
References
Health systems in action: Israel, 2022: https://eurohealthobservatory.who.int/publications/i/health-systems-in-action-israel-2022
MoH (2022) List of “balancing homes” [In Hebrew]: https://www.health.gov.il/Subjects/mental_health/treatment/Documents/ballancing-homes.pdf
MoH (2022) “Standards for the operation of hospitalization in a psychiatric home” published by the Division of Mental Health, January 2022. [In Hebrew]: https://www.gov.il/BlobFolder/policy/mtl-78-01/he/files_circulars_mtl_mtl_78-01.pdf
The MoH has recently published a comprehensive action plan to provide an array of mental health responses to the Israeli population in the event of an emergency. The main objective of the plan is to create a framework for providing rapid care in emergency events, so as to provide each person suffering from shock or trauma with the most appropriate type of care, and to reduce long-term mental health effects. Emergency events include terror attacks, national disasters and missile attacks on civilian populations, and other mass casualty events.
The plan specifies which types of responses and providers of emergency mental health support should be mobilized in various emergency situations, taking into account the severity and needs of the victims. Reponses include a variety of caregivers, which range from citizens to members of the defense forces, to mental health professionals in health plans (HPs) and hospitals. The care provided in these instances is funded by the National Insurance Institute, rather than through the National Health Insurance, which finances routine health care for all Israelis.
The operating concept is based on timing and levels of response. The rationale is that the initial response should be prompt, and then if additional care is required, it will be provided subsequently by other providers until the mental health needs are met. The action plan refers to a number of levels of care, as follows:
1. Immediate mental health response to an emergency event - aims to strengthen the emotional resilience of the population, enabling them to return quickly to efficient functioning, and reduce the risks of post-traumatic disorders. Individuals from civil society (such as police, teachers, students, and public employees) will be trained as first responders. In parallel, HPs and the MoH will increase the provision of digital responses and instructions through telehealth, social media, television, and radio, in order to reduce the need to travel to health care facilities, and the entailed risks of exposure to the threats.
2. Mental health care provided by HPs and the MoH at their clinics - for those who need professional care during or after an event.
3. Care from resilience centres - for people who developed more serious MH needs following the emergency event.
4. Hospital-based care - for shock victims whose physical or mental needs are particularly severe.
5. Continuation of post-trauma care after the emergency event - provided by MH professionals at HPs or mental health clinics.
Authors
References
5.11.1. Providers and financing
The data in this section draws heavily on the Public Summary Report of the Ministry of Health (2013a). In 2012, Israel had 3467 psychiatric beds: 0.43 beds per 1000 population. About half these beds are for short-term psychiatric care and half are for psychiatric LTC. Approximately 10% of all psychiatric beds were in psychiatric wards in general hospitals and they accounted for approximately 15% of psychiatric admissions. The proportion of psychiatric beds in general hospitals is lower than in most developed countries, but as in other countries the trend is for a higher proportion of the beds to be located in general hospitals.
The psychiatric hospital network comprises 13 psychiatric hospitals, of which eight are government owned, three are privately owned and two are owned by HPs. In addition, there are 12 psychiatric departments in general hospitals and one in the prison system. The government and HP psychiatric hospitals treat a mix of long-term and short-term patients, while the private psychiatric hospitals treat long-term patients almost exclusively.
The number of beds has declined dramatically from 2000, when there were 5619 beds. The share of private (for profit) beds has declined from 25% to 6% from 2000 to 2012.
In 2012, government hospitals accounted for approximately 82% of the beds, admissions and patient days in psychiatric hospitals (Haklai et al., 2014). The rest of the beds are in hospitals owned by non-profit-making groups. The Ministry of Health finances mental health care in government hospitals, private hospitals and psychiatric departments in general hospitals.
In the community, there are a large number of private, independent mental health practitioners and, as of May 2015, there were approximately 120 public mental health clinics (including outpatient clinics in psychiatric hospitals). About half of these were established by the HPs in the 2012–2015 period with financial support from the government, as part of the mobilization for mental health insurance reform (see section 6.1.2). Among the clinics that had been established prior to 2012, the vast majority are operated by the Ministry of Health, while others are operated by Clalit.
The Israeli component of the World Mental Health Survey 2003–2004 (Levinson et al., 2007a) found that the prevalence of common psychiatric disorders and the rate of care seeking were within the ranges found in other developed countries. Even so, only half of the respondents who met the criteria for a psychiatric disorder actually sought care for that disorder (Levinson et al., 2007b).
In a 2013 MJB survey of the general adult population (Elroy et al, forthcoming), 18% of 2246 respondents indicated that they had experienced mental distress over the past year that was difficult to cope with alone. From among that group, 23% did not seek any assistance, 31% sought assistance from informal sources (such as friends and family members), approximately 36% sought assistance from professionals and 10% sought care from non-professional formal sources. Of those who sought assistance from professionals, 40% did so within the framework of their HPs: 21% turned to their PCPs; and 19% sought help from HP-affiliated mental health specialists. Another 27% of all those who sought care from professionals turned to a government clinic, while 30% turned to private practitioners.
The Mental Patients’ Treatment Act 1991 empowered the district psychiatrists employed by the Ministry of Health to order compulsory psychiatric examination or psychiatric inpatient and outpatient care. The courts can also order psychiatric admissions. In 2011, approximately 30% of new psychiatric hospitalizations were compulsory. There are various efforts under way to reduce the powers of the district psychiatrists, for example by transferring more of the powers to the courts.
In 1990, the Ministry of Health created a Unit for Addiction Treatment within the Mental Health Services Division in order to have an effectively organized administrative system to respond to the complex needs of addiction treatment. Israel has three centres for drug abuse and mental disorders comorbidity, which cared for approximately 400 patients in 2014. Israel also had 14 methadone maintenance centres, which together cared for approximately 4000 opiate addicts in the year 2014, plus eight inpatient care units for drug addicts, with a total of approximately 140 beds. While services for people with addictions are much more widely available than they were in the mid-1990s, they are increasingly recognized as falling far short of need. The Ministry of Health has targeted this area as a priority for expansion.
There is a growing recognition of the need to develop services for people suffering from both mental illness and substance abuse. These people have traditionally been passed back and forth between psychiatric and addiction treatment centres, being treated properly in neither. At the time of writing, there are several new programmes targeted at this section of the population, but these, too, fall far short of need.
5.11.2. Recent changes in infrastructure and utilization
Since the early 1990s, the mental health care system has undergone several significant changes. Consistent with international trends, the supply of psychiatric beds per 1000 population has been reduced, from 1.48 in 1990 to 0.76 in 2005 and to 0.43 in 2012. There has also been a dramatic reduction in the utilization of psychiatric hospitals. Following a rapid decline during the 1990s, inpatient care days per 1000 population fell from 496 in 1990 to 204 in 2005 and 155 in 2012 (Ministry of Health, 2014d). There has also been a shift in the composition of psychiatric hospitalizations, from long-term to short-term admissions and to day care.
During the same period, there was an expansion of community-based mental health services, including both public mental health clinics and rehabilitation services involving hostels, independent housing, social clubs and others. In 2012, approximately 16 000 people used one or more of these services. Some have argued that this expansion of community-based services has been one of the factors that permitted the reduction of inpatient volume, while others dispute it (Aviram & Rosenne, 1998). There was also a deliberate government policy of closing psychiatric beds in order to reduce costs. Advances in the psycho-pharmaceutical domain may also have played a role. In any case, it is generally believed that, although the community-based service network has expanded, it continues to fall short of need, as approximately 70 000 Israelis receive disability allowances in conjunction with a mental health disability.
Rehabilitation has been given a significant push recently, with the passing of the Community-Based Rehabilitation of the Mentally Disabled Act in 2000 and a subsequent increase in government funding.[36] The Law grants people with psychiatric illnesses the entitlement to a range of rehabilitation services, including appropriate housing in the community, supported employment, leisure time activities, supplementary education, dental care, family support and case management. Entitlement to specific services is determined on a case-by-case basis by a regional committee. Individuals use this entitlement to receive services operated by profit-making and non-profit-making organizations in their area and are financed by the Ministry of Health.
Financing from the Ministry of Health has led, since 2006, to a rapid expansion of a range of rehabilitation services within the community. However, these services are being used by less than a quarter of persons receiving mental health-related disability allowances. In addition, some of the services being developed have, to a large extent, targeted people who were previously in hospital, for whom rehabilitation services are being expanded as a more cost-effective form of care than long-term hospitalization. The vast majority of individuals with psychiatric illnesses live in the community, often imposing a severe burden on families (see section 5.9). Rehabilitation services are difficult to obtain for these people.
In addition to financing on the basis of individual entitlement, the 2000 Community-Based Rehabilitation of the Mentally Disabled Act called for the establishment of two services to be directly funded by the Ministry of Health: a national mental health information centre and regional family support centres.