Israel is facing significant challenges in preparing for its rapidly aging population, with a recent government audit highlighting critical gaps in policy coordination, financial sustainability, and service provision. Despite over a decade of recognition of demographic changes as a strategic socioeconomic issue, the State Comptroller's report issued Sunday found no comprehensive national plan or empowered authority to address the growing needs of older Israelis.

The report, led by State Comptroller Matanyahu Englman, assessed readiness across pension systems, healthcare, long-term care, welfare services, and retirement support. It emphasized that the number of Israelis aged 65 and above is projected to increase from approximately 1.3 million today to two million by 2050, significantly intensifying demand for various services. Englman described the aging population as “one of the central challenges facing the State of Israel” with moral and value-based obligations to provide an appropriate response.

Responsibility for elder care and support currently rests with multiple agencies including the Health Ministry, Welfare and Social Affairs Ministry, Social Equality Ministry, health funds, and the National Insurance Institute (NII). However, the report found that no single entity possesses sufficient authority, budget, or mandate to coordinate these bodies effectively. Cooperation was widely criticized; about 70% of involved institutions rated inter-agency collaboration as moderate or worse, while 90% identified shortcomings in information-sharing.

Although the government formally acknowledged aging as a major long-term challenge in 2015, none of four key policy goals—including maintaining NII’s financial stability, adjusting retirement policies to increased life expectancy, boosting older adults’ employment, and expanding geriatric medical care—have been fully realized. Englman called for the creation of a funded multiyear strategy, recommending that the Prime Minister’s Office, health and welfare ministries, Social Equality Ministry, and NII jointly establish a coordinating authority, set measurable targets, delineate clear responsibilities, unify budgeting, and enhance data exchange.

A particularly urgent concern centers on the long-term care system, which supports elderly individuals requiring assistance with daily activities such as bathing, dressing, eating, and mobility. The NII’s annual expenditure on long-term care grew sharply from NIS 7 billion prior to a 2018 reform to an estimated NIS 21 billion in 2025. Concurrently, the number of benefit recipients more than doubled from approximately 180,000 to 392,000, with around 30% of retirees now qualifying for assistance compared to 16% previously.

Englman warned that these rising costs have undermined the NII’s fiscal sustainability, advancing the depletion of its reserve fund by over six years to 2035. While this does not indicate that NII would cease operations by that date, it signals the need for additional government funding to fulfill its obligations thereafter. Despite this projection, the report noted a lack of recent discussion or actuarial analysis within Israel’s socioeconomic cabinet regarding the long-term financial stability of the NII.

The report also questioned the process by which NII determines eligibility and benefit levels for long-term care. Unlike all other OECD countries, Israel predominantly relies on assessments conducted solely through medical documentation without in-person evaluations; only about 1% of cases involve home visits. Applications reviewed in this manner were found to have a 16 percentage point higher approval rate than those with face-to-face assessments, raising concerns about consistency and accuracy in benefit determinations.