The Marker, Adar Kana, 25.02.2020

Citrus bought

Tenant groups in various sheltered housing networks in Israel are complaining about the lack of a responsible party that will address the bureaucratic barriers and help them cope with unfair economic demands, they claim. However, this population is relatively small, and those who belong to it are perceived as well-established and enjoy a higher standard of living than most elderly people in Israel - and therefore the few people and bodies that donate to their aid.

Sheltered housing is a residential solution for the elderly, functioning and independent. Conditions in sheltered housing are generally high, and include a host of activities such as lectures and movies, and facilities such as a pool and gym - but this is a solution that is only available to those who can afford it.Occasionally, tenants are required to sell the apartment they own in order to finance the move to sheltered housing, deposit a high deposit and pay rent as well as additional payments.

Sheltered housing is not a nursing home: Nursing homes are 65% of senior housing institutions, and sheltered housing is the remaining 35%. Nursing homes operate under the supervision of the Ministry of Welfare or the Ministry of Health, and care for an elderly population in need of daily functioning assistance, in a variety of situations - physical or mental exhaustion, nursing status and the like. Most elderly people do not choose to move to a nursing home but are forced to do so due to deterioration in their health.

In contrast, sheltered housing tenants are self-employed seniors who do not need close care and are interested in continuing their normal lives. The location of the apartment is chosen by the tenants themselves or their relatives, and the homes provide, besides activities and facilities, medical supervision as needed.

Today, only about 2% of the elderly in Israel live in sheltered housing, but the increase in life expectancy is changing the industry, which in recent years has shown consistent growth and is attracting groups of real estate investors and entrepreneurs - who see it as a profitable asset for everything. As of 2019, in Israel, there are about one million people aged 65 and over, of whom about 450,000 are over 75. The average estimated age of sheltered housing is 70, and it is on the rise, as the number of third-year-olds in the population is growing rapidly. According to projections, by 2035 approximately 1.6 million elderly people will live in Israel by 2035.

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In Israel, there are about 90 sheltered housing units , most of them in the central and Sharon area, operated by nine major actors: Maanan, which belongs to the General Histadrut;Mediterranean towers; Rubinstein Estate; a house in the village; Home in the heart; Palace of the Azrieli Group; Up to 120 of the Phoenix; Protea; And the seniors. The impressive growth in the industry is compounding the many difficulties with which the elderly, who have already moved to live in sheltered housing, have to deal, especially with the administration and with the state authorities. The lack of a government factor that trusts the issue, as well as the political stalemate and transitional governments, is even more burdensome for finding the solution.

1. The HMOs prevent the transfer of medical information to the sheltered housing

"A tenant can come to the clinic with a simple problem and accidentally get a drug that is dangerous for him"

Chair of the Protected Housing Tenants Association

One of the major problems that tenants have to deal with is that some hospitals do not allow tenants to transfer their medical records and medical history to the protected housing physician. This is especially so when the physician providing care in the sheltered housing does not work under the same health fund. In other words, if a person lives in Haifa and belongs to a united health fund, and lives in a sheltered housing in Tel Aviv working with Maccabi - the doctor cannot enter the medical file, and the information is also not accessible to the doctors in the new place of residence.

Avraham Bar David, chairman of the Tenants Association Sheltered housing explains that this is a life-threatening situation: "People come to sheltered housing from all over the country. Older people are not at their best in terms of health, and sheltered housing has a clinic staffed by a doctor or nurses for 24 hours. A tenant can reach a clinic with a relatively simple problem Suppose a headache can be prescribed by the doctor, but this medicine can also be dangerous because it dilutes the blood and can damage the liver, for example, with liver problems. Blood tests will always go to the home clinic, which can be remote, and what happens if Urgent treatment - Once doctors do not have access to the medical record, this leads to disasters and this has already happened And not once. "

According to Bar David, the technology facilitates the transfer of information, but those who stack up for difficulties are the HMOs: "Maccabi doctor can enter Maccabi's medical record, but not national. Each of the funds keeps patients close to the chest, and will not release. The welfare ministry tried to address the issue and allow the information to be transferred between the health funds, but they claimed that they had separate software or they kept the patients' individuality in practice, they simply did not like transferring information to another health fund. To the health ministry that could require them to act on the issue, but that has not progressed and there is no one to talk to. "

Some of the sick funds (Clalit for example, and Maccabi partially) facilitate the transfer of information more easily, but as long as not all four funds - United, National, Maccabi and Clalit - cooperate, the problem cannot be solved.

2. Double VAT collection

The Supreme Court rejected the claim of protected housing tenants, stating that additional services are also a paid component on its own - and therefore did not exempt them from VAT.

One of the main disagreements between sheltered housing and the state is the issue of VAT, which also raises the high costs of sheltered housing. In 2019, the average housing deposit was NIS 2-1.5 million per apartment, and in some places it also reached 5 million. NIS (depending on the location and size of the apartment). The monthly maintenance fee is NIS 9,000-6,000 per month.

The VAT law states that renting a residential property is exempt from VAT payment, but the protected housing tenants are killed and need to add a VAT rate of 17%, since alongside the regular rental, they are offered a basket of services in the areas of society, culture, medicine and nursing - services. By law, VAT is charged.

Protected housing tenants say it is a discrimination that has cost them the high payments that way - making it difficult for them to live in sheltered housing for years. Bar David claims: "Protected housing tenants are the only people in Israel who pay VAT on rent, and have to pay three types of unwarranted and scandalous VAT - rent on rent, VAT on erosion of the deposit and reflective VAT (taken on loans) That is, the state takes from every person who enters sheltered housing 50-30,000 shekels a year, without any justification. "

Bar David relies on an economic opinion he published for the association in January 2019 Boaz David, formerly the Treasury Budget Manager and currently an economic consulting firm. The opinion states: "The VAT law is exempt from paying VAT on residential property rental for a period not exceeding 25 years. According to the provision, it is clear that there is no justification for VAT in that part of the tenants' payments paid for the right to use protected housing through erosion. In the opinion, Boaz notes that the amount of VAT collected from sheltered housing is estimated at NIS 96-54 million a year.

"In the Tax Authority, I was told that they do not intend to initiate a VAT coordination procedure for tenants, which will reduce their income"

Boaz David

This issue has already reached the Supreme Court in 2012, and Justice Yitzhak Amit rejected the argument of the Protected Housing Association in Israel, stating that the residential component is indeed a significant component of sheltered housing deals, but the "additional services" are a significant component of its own - and therefore He did not exempt them from VAT, in a trial where the other party was the tax authority.

But the fight did not stop. Boaz David claims that the association handled the issue incorrectly: "The court did not accept the claim, but in my opinion it is a strange verdict. I came into the picture a year and a half ago and had serious discussions with the tax authority. There I was explicitly told that I was right, but they did not mean Initiate a move that will reduce their income from taxes, so the only way is to promote it in legislation. "

A tax authority official told TheMarker that their position has not changed, and that it is difficult to distinguish between the VAT component and the housing component that is exempt from VAT in sheltered housing. He added that even if the authority decides to grant tenants exemption, it is not at all certain that the companies of the sheltered housing will roll the discount to the tenants. The source claims that the situation can only be changed in legislation.

3. Political stagnation and apathy on the part of government ministries

The lack of regulations in the law that would allow real oversight of the protected housing sector impairs the ability to put an end to these problematic situations, and to secure tenants' rights. The many legislative initiatives in the 19th and 20th Knesset seats have not been sufficient to mature, and stand as an irreversible stone because of the political stalemate and the transitional government.

For example, Bar David says that the association addressed the issue of VAT and others to some Knesset members, and there were also two who raised the gauntlet - former MKs Nurit Koren (Likud) and Tali Pluskov (all of us). According to Barry Bar David, "they really took it upon themselves and we have made some progress, but in the meantime, due to the government instability and the existence of the third election campaign, both of which are no longer on the lists and no one will continue."

Korn, who was a member of the Labor, Welfare and Health Committee, says: "On economic issues, the treasury always hinders you. It has happened in all sorts of previous initiatives, and here, too. I submitted a bill on VAT, we started talking to the treasury and they disagreed - they told me, 'What are you doing with the top decile? Only they go to such apartments. ' I explained to them that the costs had to be lowered and maybe that way it would be more accessible, and my mother could go there too. The state should encourage people to reach such places that extend life. The problem is that in order to move things, a team with enough power needs to be, and they probably don't have one.That should change because we will all end up there, and if Israel sees itself as a welfare state - it is impossible to continue that way. "

In addition, Bar David explains that factors that were previously appointed by the Ministry of Welfare or Health on such issues have also been transferred or not promoted. "There is a problem with the establishment, because there is no one who cares for sheltered housing. The welfare office was responsible and had four employees, but they moved it and dismantled the department - and we forgot. The Ministry of Health had someone who met with us, but it was loaded with other things and no one was promoting things. I tried to speak to Knesset members, and there was one who bluntly said to me: 'You are all less than a quarter of the mandate together.' With such an approach - who do we care about? "

The Ministry of Welfare said: "The office's supervisors handle the complaints of the tenants and, if necessary, also refer to an exceptional committee. A tender for the appointment of a sheltered housing officer is currently being held, and in the meantime the area is managed by a deputy. The synchronization of information between the protected housing units and the hospital funds is a complex process that has already begun. Clalit and Maccabi patients. Promotion of the process also depends on cooperation from the protected housing operators and the health funds themselves. "