Israel Expands Health Benefits to All Citizens : Mideast: Unanimous vote in Knesset ends six years of debate. New law imposes salary tax to finance national system.

After six years of debate and a power struggle that reshaped Israeli politics, Parliament on Wednesday enacted a national health law that guarantees medical care for all citizens as a basic right.

The law brings into the country’s four medical care funds those Israelis, about 6% of the population, who have been without health insurance, often because of serious diseases, and it expands the services the funds provide.

But the major change is to finance health care through a 4.8% salary tax and to funnel the money through a government agency rather than through Israel’s trade union federation, whose General Sick Fund is virtually bankrupt after years of mismanagement and survives only on government handouts.

“We have revolutionized the life of Israel’s” social services, former Health Minister Chaim Ramon said in triumph after the Knesset, Israel’s Parliament, approved the law, 68-0. “We have changed the entire health system.”

A major element in the law will be the financial incentives offered to health funds to enroll children, the elderly and the chronically ill--in effect, fostering competition to provide medical services for those most in need of them.

“This is definitely a great day for all those who struggled for egalitarian medicine in Israel,” said Chaim Oron, chairman of the Knesset subcommittee on health services. “The law creates a very good basis for the continuing political struggle to improve the range (of services).”

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The bill’s passage was a major political victory for Ramon, who quit as health minister when Prime Minister Yitzhak Rabin and other Labor Party leaders withdrew their support for his version of the law. Ramon, 44, then campaigned for leadership of the Histadrut, the labor federation, defeated the Labor old guard there and positioned himself to succeed Rabin, perhaps at the next election in two years. He becomes secretary general of the Histadrut later this month.

Hailing the new law as finally achieving a goal set by Israel’s founders more than four decades ago, Ramon said, “Israel will be the same as most progressive countries in the world in health care,” guaranteeing its citizens advanced medical care, allowing them to choose those who provide it and paying for it based on their income.

“I’ve dedicated almost every day, since the time I was health minister until now, to this,” he said. “It was so difficult, with such painful labor pains. . . . For me, this is perhaps the greatest, the most important, the sweetest moment.”

The law breaks the mandatory link between membership in the Histadrut and in its health care fund, which now covers 67% of Israelis. With support from Labor Party leaders, the Histadrut fought bitterly against Ramon to maintain the linkage, which has both swelled its membership and ensured a large portion of its revenues.

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But a companion bill levies a 0.8% “organization tax” on salaries that will go to Histadrut, effectively requiring virtually all Israeli workers, including non-union members, to support the federation, long one of the most powerful institutions in Israel.

The legislation incorporates in the basic health care services guaranteed all Israelis a number of benefits, such as prenatal care, that the General Sick Fund began offering this year in an effort to retain its members in the face of strong competition.

The law also provides for state financial assistance for those in old age homes and for elderly citizens receiving nursing care; the state will also continue to cover psychiatric care, including hospitalization. Under the legislation, the government will monitor the health care funds far more closely than it has done in the past to ensure that they provide proper medical services and are well managed.

* TIES WITH VATICAN: Israel and the Vatican cemented full diplomatic relations. A6