Health Insurance law

What is the Health Insurance Law?

Under the national Health Insurance Law, in effect as of January 1, 1995, every
Israeli resident is covered in national health insurance, whether or not he is a
member of a sick fund.

Who is exempt from payment of health premiums?

1. A married woman who does not work outside her household (housewife) and
   whose husband is insured;
2. A person who is neither an employee nor self-employed, and who does not
   have income above 5% of the average wage is
   exempt from payment of health premiums if he is one of the following:

1. a new immigrant - for a period of 12 months from the day of his
   immigration;
2. a soldier aged 18-19 - for one year;
3. a prisoner who has been imprisoned or under arrest for over a year.

 Note:
Additional payments for supplementary health insurance, to cover treatment
by specialists and medications, are made directly to the sick funds.

Recipients of subsistence benefits from the NII are entitled to discounts/
exemptions for specialist treatment and medications.

The income from which health insurance premiums are paid is the same income
from which national insurance contributions are paid. It is calculated in
accordance with employment status and rate of income, on the basis of the
average wage updated from time to time. The minimal income for collection of
national insurance contributions is 25% of the monthly average wage.

The maximal income for collection of insurance contributions is 5 times the monthly
average wage.

Employees

An employee pays health premiums according to the following calculation:

 - 3.1% of the share of wages that is up to half the average wage;
 - An additional 4.8% of the share of the remaining wages, up to a ceiling.

Health premiums are deducted from wages together with the deduction of
national insurance contributions.

Kibbutz members pay premiums at the same rates paid by employees.

Domestic worker

Pays 1% of his wages.

Recipient of early pension

Pays 4.8% of half his pension.

An employee during unpaid vacation

For the first two months, pays 3.1% of a quarter of the average wage, deducted
by the employer. After two months, pays 4.8% of a quarter of the average wage
directly by the insured person.

A soldier in the standing army

Pays health premiums in accordance with the following table:

Although soldiers in the standing army pay health premiums, they are not entitled
to health services in the framework of the national Health Insurance Law, but
rather receive medical services from the army.

Families of such soldiers are entitled to health services, as are families of employees.

Self-employed

The self-employed pay health insurance contributions according to the following
calculation:

- 3.1% of the share of income that is up to half the average wage, and an additional
4.8% of the remainder of the income, up to a ceiling.

For example, on an income of NIS 10,000, health premiums of NIS 429 are paid.

A person who is both an employee and self-employed

Health premiums are deducted from his wages in the same manner as for an
employee, and from the remainder of his income as a self-employed person,
at the rates and up to the ceiling indicated above.

Income not from work

Income not from work is liable for health insurance premiums, at the rate of
4.8% of total income, without any reduced rate.

For example: on an income of NIS 5,000, health premiums of NIS 240 are paid.

Minimum premiums

The following pay a minimal rate of health premiums (NIS 84 per month):

• a person who is neither an employee nor self-employed and who has no income;
• a resident living abroad;
• a student, including yeshiva student.

Comment: a student who has a salary pays health insurance premiums in
accordance with his salary. If he also paid premiums as a student (by means of
a payment book), he is entitled to reimbursement.

Collection of Health Premiums from Recipients of NII Benefits

• Attendance allowance;
• Mobility;
• Disabled child;
• Child allowance;
• Righteous gentile.
• Long-term care.

 Comment: a housewife (a married woman who does not work outside her
household) who receives a benefit is exempt from payment of health
premiums on that benefit.

Persons who receive one of the following benefits and who have no other source
of income - minimal health premiums (NIS 84) will be deducted from their benefit.

• General disability;
• Work disability (up to age 65 for a man, 60 for a woman);
• Dependent's pension (up to age 65 for a man, 60 for a woman);
• Hostile action benefit;
• Income support;
• Alimony;
• Survivors.

Comment: a person who, in addition to one of the above benefits, has income liable
for national insurance contributions (as an employee or a self-employed person, or
having an income not from work) - health premiums are deducted from his income
and not from his benefit.

A person who receives one of the following benefits pays health premiums at the
regular rates, even if he has additional income:

• Unemployment allowance;
• Maternity allowance;
• Injury allowance;
• Reserve service allowance (personal claims).

D. Recipients of old-age pensions

Health premiums are deducted from old-age pensions at the following rates:
(January 2002)

Old-age pension with income supplement - the minimal sum of NIS 85.
Basic old-age pension without income supplement (single person) - NIS 159.

 A man who receives an old-age pension with an increment for his wife, or a
couple who receive old-age pensions in their own right - health premiums shall be
deducted at the rate of NIS 230 .

Note: Recipients of old-age pension are exempt from payment of health premiums
from other income.

E. Recipients of benefits from the Ministry of Defense or from
   the Ministry of Finance

IDF disabled, widows and bereaved parents who receive benefits from the
Ministry of Defense pay health premiums at the minimum rate of NIS 84, on
condition that they have no other source of income.

The premiums are deducted directly from their benefit.

 If they have income from which health premiums are deducted, they are
exempt from payment of premium from their benefit.

Persons disabled as a result of Nazi persecution or the war against the
Nazis, who receive benefits from the Ministry of Finance, pay health premiums
on their benefits on condition that they have no other source of income.

Note: Recipients of benefit who are under pensionable age pay the minimal
rate of NIS 84. Those of pensionable age pay the rate for a single person or
for a couple, according to their family status.

Recipients of benefits from one of these two Ministries who also receive a
benefit from the NII pay health premiums only from the NII benefit.

Rules of Registration at Sick Fund

As stated in the law, every Israeli resident must register himself at one of the sick
funds. This may be done at any post office branch by means of a special form.

A resident who has reached the age of 18 and is not a member of any of the sick
funds must register himself.

Registration of minors

Every Israeli rmust register his childrin the same sick fund to which he belongs.

A child must be registered at a sick fund within 6 months of his birth. A child who
is not registered is considered to be a member of the sick fund to which his parent
who receives child allowance for him belongs. If the parents wish to transfer
their child to the sick fund of the parent who does not receive the allowance, they
must fill out a transfer form at the post office and both of them must sign this form.

Demobilized soldiers

Under law, after demobilization from army service, a soldier again becomes a
member of the same sick fund to which he belonged before his mobilization.

If his demobilization is not yet recorded at the NII, he must send his demobilization
documents to the NII in order that the NII may update its health file and the sick fund
of which he is a member.

If he requests to transfer to a different sick fund (which he may do even in the
course of his army service), he must perform this transfer in accordance with the rules
of transfer to another sick fund.

If the demobilized soldier is not a member of any sick fund, he must register himself
at the sick fund of his choice at a post office branch.

Released prisoner

A released prisoner again becomes a member of the same sick fund to which he
belonged before his imprisonment.

If the NII is not updated regarding his release, he must send the NII his release
documents in order that the NII may update the health file and the sick fund of
which he is a member.

If the released prisoner is not a member of any sick fund, he must register
himself at the sick fund of his choice at a post office branch, and he shall be
immediately entitled to health services.

If he wishes to transfer to another sick fund (which he may do even while
imprisoned), he must perform this transfer in accordance with the rules of
transfer to another sick fund.

Transfer to another Sick Fund

A person who wishes to transfer from one sick fund to another may do so on
condition that he has been a member of the previous sick fund for at least
one year. The transfer must be recorded on a special transfer form at any post
office branch, in accordance with the following rules:

• The registration comes into effect at the beginning of the year (January 1^st),
  if the transfer form was submitted at any date between April 1^st and
  September 30^th of the previous year.

• The registration comes into effect in the middle of the year (July 1^st), if the
  transfer form was submitted at any date between October 1^st and March 31^st
  of the previous year.

Registration of only the following people will come into effect immediately, and
they will become entitled to receive medical services right away:

1. young adults between the ages of 18 and 18½;
2. new immigrants;
3. children between the ages of 0 and 6 months;
4. persons who were not members of any sick fund.

Canceling transfers

A person who already registered a transfer to another sick fund and he wishes to
cancel this transfer - may do so by means of a cancellation form at any post office
branch, in accordance with the following rules:

• if he submits the cancellation form by October 31^st, his registration shall
  come into effect at the beginning of the next year (January 1);
• if he submits the cancellation form by April 30^th, his registration shall come
  into effect in the middle of the same year (July 1).

Cancellation forms may be used only for purposes of transfer from one sick fund to
another, and not for new registrations.