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Social Security Scheme – National Insurance and National Health Insurance

National Insurance Law:
The Israeli National Insurance Institution Law (hereinafter: N.I.I) grants Israeli residents certain compensation in respect of injuries at work, which include; work accidents and work related diseases. This is subject to a causation test to ensure that the main cause of the accident was the work environment. The amount of compensation is determined according to the degree of disability.
Pursuant to the law, the N.I.I has the right of subrogation- if a death, injury or disease are deemed a work related accident. Following payment of compensation by the N.I,I, it is entitled to subrogate the amount paid from any tortfeasor, so long as the tortfeasor is not the injured party`s direct employer.
The right of subrogation only subsisted when the law applies and the N.I.I has compensated the injured.

National Health Insurance Law (1.1.1995):
The National Health Insurance Law provides that every Israeli resident is entitled to health services according to the law. The State is responsible for funding minimum health services specified in the law. The health services are provided by the various health maintenance organizations (hereinafter: "HMO").

The law further provides that an HMO or any other organization, which extended services as a result of a tort, is entitled to subrogate a sum equivalent to the value of the services it provided, from the tortfeasor.

Therefore, in theory the new regime is similar to the one existing under the N.I.I law, however in actual fact, in the past, the HMOs rarely exercised their subrogation rights. In the last few years, perhaps as a result of increasing health costs, HMOs have taken more initiative in perusing subrogation actions.

In spite of this pessimistic forecast, following a recent precedent regarding cigarette related illnesses, in which a subrogation claim was filed, the situation may change.

 



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