Impact of new medical technologies on health expenditures in Israel 2000–07

Mordechai Rabinovich
Maccabi Healthcare Services and Ben-Gurion University of the Negev

Francis Wood
Maccabi Healthcare Services

Joshua Shemer
Gertner Institute for Epidemiology and Health Policy Research and Tel-Aviv University

Objectives: The aim of this study was to estimate the impact of new medical technologies
on public healthcare expenditures in Israel over the period 2000–07.
Methods: For each year, government estimates for the costs of new technologies
recommended as high-priority for public funding were summarized. The ratio of projected
costs of these technologies to total public healthcare expenditures was calculated and
compared with actual governmental budget allocations for new technologies.
Results: Funding all new high-priority medical technologies would have increased
healthcare expenditures by 2.1 percent per year. Government allocations for new
technologies raised expenditures by 1.0 percent per year.
Conclusions: New medical technologies significantly increase healthcare expenditures in
Israel. Budgetary constraints have reduced their actual impact by 52 percent. This study
indicates the need for an annual addition of 2 percent to public healthcare budget for
funding new high-priority technologies.
Keywords: Healthcare expenditures, National list of health services, New medical
technologies