Families Paying for Two Health Insurance Policies Lose 4,000 Shekels Annually as Reform Leaves Loophole Open
Overlapping private health insurance and HMO policies lead to unnecessary expenses. A family of four can save approximately 4,008 shekels annually by optimizing their coverage structure.
A person who holds supplementary health insurance from a health maintenance organization (HMO) and simultaneously a private surgery policy from the 'first shekel' pays for the same medical event twice. Coverage overlaps in most surgeries performed in Israel, but the premium is collected in full in both places.
The calculator translates this overlap into a monetary sum. A family of two adults aged 45 and two children that holds both coverages spends about 9,360 shekels per year, with 86% of the amount going to the private policy. Switching to a supplementary 'Shevet' policy, which comes into effect after the HMO has exhausted its share, reduces the premium by about half while keeping the surgery coverage intact. In shekels, this amounts to about 4,008 shekels per year, which is close to 40,000 shekels over a decade.
The health insurance reform attempted to close this loophole. In the summer of 2024, about 636,000 policyholders were automatically transferred from the 'first shekel' policy to the supplementary 'Shevet' policy, but three groups remained outside the move: those who purchased the policy before 2016, those insured under group policies through their workplace, and those who do not have 'Shevet'. In addition, about 269,000 policyholders, 42% of those transferred, took advantage of the objection period and returned to the old policy. Out of about 1.65 million holders of 'first shekel' policies, a large majority continues to hold both coverages.
The calculator asks for the family composition, the 'Shevet' level, and the type of private insurance, and displays the annual and monthly expenditure alongside a breakdown between the two coverages. Those who know their exact premium from their pay stub or annual report can enter it and receive a personal calculation.
At the bottom, there is a coverage table that marks what is covered by 'Shevet', what is in the private policy, and which lines appear in both. There lies the explanation for the gap: surgery abroad, transplants, and drugs outside the 'basket' are covered by the private policy only, while complementary medicine, pregnancy tests beyond the 'basket', and child development come through the HMO. This is the logic behind the structure of 'Shevet' entering first and a policy supplementing it above.
The financial gap has actually widened since then. 'First shekel' premiums have become more expensive by tens of percent following the reform, while supplementary 'Shevet' policies have become more expensive at a much more moderate rate, so the distance between the two alternatives is greater today than it was before the move.
The calculator also identifies the opposite situation. Anyone holding a supplementary 'Shevet' policy without an active 'Shevet' in the HMO receives a warning, because such a policy is built on the assumption that another party pays first, and without it, it may pay a much smaller portion than expected.
The result is an estimate for illustration. The coverage conditions, waiting periods, and deductibles are determined by the policy and the HMO bylaws, and canceling existing coverage may prevent returning to it under the same conditions. Anyone considering changing their coverage structure should do so with a licensed professional, and preferably before canceling an old policy for which the waiting period has already been completed.
The full article was originally published on Bizportal.
