Israeli Health Funds Face Financial Challenges Amid Rising Costs
Translated & summarized from Globes by baba
Israel's largest health fund, Clalit, saw a slight decline in market share in 2025, though its absolute membership grew. Other health funds like Maccabi and Meuhedet experienced marginal gains. Clalit significantly reduced its deficit, attributed to its public hospital operations. The government provided NIS 4.6 billion in support to health funds, with rising medication costs posing a future challenge.
The story in 6 lines · by baba
- Clalit, Israel's largest health fund, experienced a slight decrease in market share in 2025.
- Maccabi and Meuhedet saw marginal increases in their insured populations and market share.
- Clalit reduced its deficit to NIS 364 million in 2025, down from NIS 542 million.
- Government support to health funds totaled NIS 4.6 billion in 2025, an increase from the previous year.
- Rising costs of medications, especially for chronic and rare diseases, are a growing concern for health funds.
- The Ministry of Health is working to integrate subsidies into the official health basket and increase HMO budgets.
Clalit, Israel's largest health maintenance organization (HMO), experienced a slight decrease in its market share among insured individuals in 2025 compared to 2024, according to a Ministry of Health report. Clalit insures 50.78% of the population, down from 50.96% the previous year. In terms of "standardized persons," which accounts for demographic factors influencing funding, Clalit's share of capitation budget decreased from 52.19% to 51.88%.
Maccabi saw a marginal increase in market share, rising from 27.48% to 27.51% of all insured, and from 27.8% to 28.07% in standardized persons. Leumit maintained a stable market share of 7.57%. This trend of Clalit's market share decline, particularly in standardized persons, has been ongoing since 2014, dropping from 55.83% to 51.88%, while Maccabi's share grew from 23.88% to 28.07% in the same period.
Despite the market share dip, Clalit's absolute number of insured members increased, largely due to new births and the addition of 73,000 members from other HMOs. However, other HMOs also attracted members from Clalit, with Maccabi gaining 29,600, Meuhedet 37,000, and Leumit 17,500. Clalit reported that its member attrition rate of 1.72% is significantly lower than the average of 2.36% for other HMOs.
Clalit significantly reduced its deficit to NIS 364 million in 2025, down from NIS 542 million the previous year, primarily due to its operation of public hospitals, which are typically loss-making. The Ministry of Health noted that the deficit reduction stemmed from ongoing operations and revenue from out-of-basket services, with improvements also seen in the hospital sector.
Overall government support to the HMOs reached NIS 4.6 billion in 2025, an increase from NIS 4.1 billion in 2024, mainly for mental health and general stabilization. The Ministry of Health is working to integrate these subsidies into the official health basket. Despite these measures, HMOs still require approximately NIS 1.9 billion in stabilization support for 2025. Rising costs, particularly for medications for rare diseases, obesity, and Alzheimer's, are a growing concern, with total spending on drugs and medical equipment doubling from NIS 7.3 billion in 2011 to NIS 14.8 billion in 2025. The Ministry of Health emphasizes the need to increase HMO budgets to address these escalating costs.
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