Isr Med Assoc J
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Comparative Study
Spending on medicines in Israel in an international context.
Like most developed countries, in the last decade Israel's healthcare system has been subject to cost-containing measures in the drug sector. ⋯ Israel, a medium-income country with a lower than average level of expenditure on health compared to OECD countries, has a particularly low level of expenditure on medicines. Whereas the share of health expenditure of GDP in Israel is similar to the international average, the share of drug expenditure of GDP is well below the average. In addition to structural and longer-term factors contributing to Israel's low per capita spending on medicines, such as the young population and the apparently low level of actual prices paid by most institutional purchasers, recent years are witness to the growing impact of National Health Insurance budgetary pressures on HMOs as well as continual increases in prescription cost sharing by patients. The impact is felt both on the demand side (higher copayments, administrative and prescribing restrictions) and perhaps more crucially on the supply side (price competition, mainly from generics). Substantial extra public funding for the addition of new drugs to the NHI basket in recent years has had no overall impact on these longer-term spending patterns.