While playing with the latest update for Word for Mac 2016, 15.19.1, I thought the level of support for Arabic/Hebrew seemed considerably better. Not only are Arabic characters connected, but the cursor starts at the right and moves properly along with the text, changing fonts doesn't seem to cause problems, punctuation goes in the right place, vowels work, text is inserted where the author expects, etc.
So far there is still no direction control button or menu, and copy/paste from other sources may result in incorrect word order. Also changing the color of the text can mess up chracter order.
I've seen rumors that the next update, 15.20 is supposed to have additional improvements and fixes.
As my knowledge of Arabic/Hebrew is extremely limited, I'd be grateful for comments from readers with better capabilities regarding the usability of this app for such scripts.