State Comptroller Matanyahu Englman says Israel has failed to prepare for population aging, leaving National Insurance payments and long-term care spending on a path that could exhaust the National Insurance Institute’s fund within less than a decade. The report, published Sunday, says a 2015 government decision and national economic strategy identified aging as one of six major socio-economic challenges, but the four planned response tracks were either not implemented or only partly carried out.
The auditor says the institute’s actuarial deficit has worsened sharply. Between 2020 and 2025, the projected year when the fund would be depleted moved up by nine years, from 2044 to 2035. He links this in part to rising care costs, noting that life expectancy in 2024 stood at 81.4 years for men and 85.5 for women, while retirement ages were not adjusted, 67 for men and gradually 65 for women.
The report focuses heavily on the 2018 long-term care reform. The number of people eligible for care benefits rose from about 180,000 in 2018 to about 392,000 in 2025, and the share of retirees receiving the benefit nearly doubled from roughly 16% to about 30%, more than double the OECD average. Although the Treasury had estimated the reform would add 1.3 billion shekels a year, actual annual spending on care rose by about 14 billion shekels, from roughly 7 billion before the reform to 21 billion in 2025.
Englman says care assessments done from medical documents were approved at a rate about 16 percentage points higher than home assessments, and some of the rise in eligibility stemmed from the shift away from in-person checks. He also says National Insurance assigned care levels that were 1.7 levels higher than those found in health fund dependency tests, creating an estimated annual overpayment of 9.5 billion shekels. He adds that Prime Minister Benjamin Netanyahu did not bring the issue to cabinet, the socio-economic cabinet has not discussed National Insurance’s long-term stability, and a ministry team set up in June 2025 has met 12 times but has not yet issued recommendations. The auditor calls for a multi-year national plan and says there is still no central body coordinating aging policy.
