Mr. Dónal Clancy:

An element that must be brought out is the recession and even the perception of how bad it is also drive people's behaviour. For example, people may think they had avoided having that dodgy knee seen to for quite a while but that now is the time to so do. Alternatively, people might think they could be out of a job next year, etc. rather than what actually is the reality. This both drives and changes people's behaviour.

Fundamentally, however, as a country we must establish that we have a good system, we need intergenerational solidarity and we must protect community rating. Laya Healthcare is behind that but it must be done effectively and efficiently. There is no point in instigating a system that drives inefficiencies and causes the overall affordability and the consumer to suffer more than is necessary. While we have some suggestions in this regard, I revert to universal health insurance and the ultimate destination we would like to reach. Laya Healthcare is fully supportive of this idea as to us, the idea of developing a multi-insurer universal health insurance market is a really good idea and is something towards which we should work. Moreover, any legislation, levies or interim measures that are introduced now should be following a roadmap towards this final destination. We believe one key element in this regard is meaningful engagement. It has been discussed in this joint committee both previously and today but in reality, we have found very little meaningful engagement. When the insurers get around the table with all the other stakeholders, we participate, there is co-operation and I believe good solutions are arrived at. However, we also are of the view that this opportunity is not taken often enough and the future path to success in this regard involves greater engagement with all the stakeholders. In particular, for example, the universal health insurance working group has no representative from the health insurance market on it. In addition, consulting on particular elements of legislation after they are published is a lot less productive than so doing before publication.

However, to move on, when looking at solutions and the current position, I note this is an unusual market. Each market is different and we are in a voluntary market in which penetration is exceptionally high at approximately 50%. However, a highly diverse element of products is contained therein. We must get the consumer to the centre of this. Our view is to support the continuation in the market of the healthier people and younger people. We concur with much of what has been stated here today. We see no reason one cannot, in the interim solutions that are being proposed, have age-at-entry provisions to get more people into the market at a younger age to help to sustain its community rated elements. It also makes no sense to us for children to be paying a levy. We believe this all acts as a disincentive to families and for their future of this market. Ultimately, in the current situation one is talking about a price spiral. Basically, people leave the market but the more people who do so, the more the claims costs rise for those who remain and the more their claims costs increase, the more the price must rise. As a group, our incentive should be to incentivise the younger and healthy people to stay in the market and equally, to then work out what actually must be done with regard to risk equalisation.

On a future roadmap, if one considers universal health insurance and the ultimate goal of attaining it, there must be a change of practice. The current two days notice for something to happen in legislation, two days notice for the price of a public hospital bed or a couple of days notice for the price of the levy, do not encourage good management. This does not encourage us and I believe my colleague from Aviva mentioned the guessing game. If one is in a position in which substantial costs may be put on anyone with two days notice, the reaction will be equally disproportionate. This is what is happening at present in the market and we must get away from that. We have made proposals that would allow for reasonable trade-in time in any of these legislative changes and would welcome any movement that gets us there. The roadmap to the future must have a clear plan which gets us meaningful timing and management of our prudential elements that are required for the normal insurance market. In that frame, for example, we welcome that the VHI is to be regulated this year and hope it will pass on this occasion. Our perception is that if a reasonable roadmap and plan is put into action in the current legislation, we ultimately will get to universal health insurance.