Israel's enactment of national health insurance was clearly a breakthrough. However, other aspects of reform that were supposed to be implemented simultaneously were stymied, in particular, the conversion of government hospitals to independent trusts and removing the Ministry of Health from the direct provision of services such as mental health and long-term care. This article explores how punctuated equilibrium and path dependency coexist in the Israeli case. In doing so, it examines the relevance of concepts provided by various theories of social and institutional change. Aside from path dependency and punctuated equilibrium, we discuss other notions derived from related theories, such as political leadership and the role of ideas. Applying these theories to the Israeli case helps better understand the coexistence of punctuated equilibrium and path dependency.