Abstract Objectives Research has shown that early surgical intervention for hip fractures serves to decrease mortality. In 2004 the Ministry of Health decided to condition the reimbursement regime at the time of operation. The objectives of this study were to examine whether the reform succeeded to decrease inpatient mortality of hip fracture casualties. Method The study utilised data drawn from the Israeli Trauma Registry (ITR) for the years 1999–2006. The study population included patients aged 65 and older with an isolated diagnosis of hip fracture following trauma. Results Two years after the reform, the inpatient mortality decreased by 34% amongst patients undergoing fixation surgery, and by 30% amongst all operated patients. Median LOS decreased by 2 days. The proportion of patients undergoing hip fracture fixation surgery within 48 h increased by 35%. Conclusions The implementation of a payment limited by time for hip fracture fixation surgery increased the number of patients being operated within 48 h, shortened patient LOS, and decreased inpatient mortality.