Israel's Health IT Industry: What Does the American Recovery and Reinvestment Act Mean for Israeli Collaborative Opportunities?
Jan 01, 2010
Yitzhak Peterburg

Through the Recovery Act, the United States is investing as much as $42 billion in Medicare and Medicaid reimbursement incentives to health-care providers using electronic medical records and system interoperability, an area in which Israel's medical sector excels.

Few people know that Israel is one of the global pioneers in health information technology, a digital revolution that began in the mid-1990s. Electronic medical records are used by virtually 100 percent of the country's primary-care physicians, compared to 20 percent in the United States, and the vast majority of Israel's doctors also use laboratory and imaging information systems, computerized physician order entries, and e-prescribing. These virtual records have eliminated inefficiencies caused by medical files previously scattered among different service providers, and they have helped promote a continuum of care, improve the quality of care, and reduce costs significantly.

As Israel's Health IT Industry points out, that nation's leadership, expertise and competitive advantage could serve as models for the United States and other nations that are moving toward a more fully digital health-care future. Israeli companies have much to give - and much to gain - by providing their expertise and technologies to the global market.

Based on a comprehensive survey of Israel's health IT industry, this report identifies Israeli companies that could participate in U.S. health IT initiatives, either immediately or in later phases. It also recommends several ways that Israel can build on its medical sector's accomplishments and better market its health IT expertise, among them:

  • Immediately establish an organizational structure that will assume responsibility for the Israeli health IT opportunities in the United States.

  • Market the Israeli IT health industry by creating an Israel health IT website; distributing information through Israeli commercial liaisons in the United States; participating in major health IT conferences; and leading focused health IT road shows.

  • Develop public-private partnerships to expedite Israel companies' R&D efforts and investments in marketing and sales forces. Other models could be discussed, but they must include participation of venture capital and private equity.

    This project is an extension of the Institute's previous work and interest in Israeli health services. In December 2007, the Institute convened a Financial Innovations Lab followed by a session during the President's conference in 2008 in Jerusalem, "Accelerating Medical Solutions in Israel," which resulted in a number of recommendations to bridge the capital access gap with a private-public fund; develop greater IT infrastructure; and create a network of global collaborations to export Israeli innovations.