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Table 1 Characteristics of the voluntary health insurance market in Israel

From: Medical loss ratio as a potential regulatory tool in the Israeli healthcare system

Market segment Health plans Group commercial Individual commercial
Legal framework National Health Insurance Law (1994) Insurance Contract Law (1981) Insurance Business (Control) Law (1981) Insurance Contract Law (1981) Insurance Business (Control) Law (1981)
Regulatory Authority Ministry of Health Ministry of Finance Ministry of Finance
Medical underwriting is legally possible No Yes Yes
Eligibility Health plans’ enrollees Organization (group) members Whole population
Premium level Community rating Community rating Risk adjusted
Contractual horizon and flexibility Short-term, periodically modifiable (both premium and coverage) Short-term, periodically modifiable (both premium and coverage) Guaranteed lifetime contract, relatively non-modifiable
Tax status Nonprofit For-profit For-profit
Number of firm 4 6 10
CR3 95%* 95%** 69%**
Herfindahl-Hirschman Index# 0.35* 0.40** 0.21**
Channel diversification Single contract to a large group Single contract to a large group Different contract to each individual
Vertical structure Partial ownership of most of providers Contractual linkage with providers Contractual linkage with providers
  1. The index measures the fraction of market income (paid premiums) that is attributed to the three largest firms.
  2. #The index is calculated as the sum of squared share of all firms operating in the market. The share refers to the ratio of firm’s premiums income in the total income in the market.
  3. *Computed by the authors following data from 2013 public report of the Ministry of Health [11].
  4. **Source: 2013 public report of the Ministry of Finance [12].