 The Israeli government's introduction of procedure-related group, PRG, based payments for hospitals in 2010 had a significant effect on the organization of hospitals and their decision-making processes. The payments encouraged hospitals to increase the number of patients they treat, while simultaneously reducing the length of patients' days and increasing the efficiency of ORs. Additionally, the payments created a competitive environment among hospitals, leading to increased cost consciousness in procurement and improved coding accuracy. However, these effects were tempered by other factors, including the public nature of hospitals, the availability of healthcare resources, and conflicting incentives between different payment mechanisms. This article was authored by Ruth Weitzberg, Willem Quinton, Elad Daniels, and others.