Denis Naughten (Roscommon-South Leitrim, Independent) | Oireachtas source

The Minister will recall that when we spoke about this provision on budget night, I told him he would be revisiting it because it was drafted with errors. I note he has redrafted it by including this amendment which I agree is welcome. However, the amendment to the budget day proposal is a retrograde step because, bizarrely, the proposal put forward on budget day, as drafted, would actually encourage more families to come into the system because they would earn the additional tax relief for children and it would have removed the pressure on the system as a whole. Some insurance cover is less than €500 and in the case of some insurance policies, children are free.

There seems to be a lack of understanding of the implications of these proposals on the health insurance market. The Minister makes the point that 7% of people have cancelled their health insurance policies but that is not correct; there are 7.5% fewer people with private health insurance but the trends will show that while younger are leaving the system, older people are joining up for the first time. That is the reason for the variation. I agree with the principle that people with very high policies should be given a subvention. However, the difficulty is that the average family will have to pay more, based on the reduction in the tax relief. The Minister is attempting to give the impression that it is only €40 or €100, spread over the policy and that it will not be a significant amount of money. The difficulty is that this is just one aspect of the increasing pressure on private health insurance. The insurance levy will add additional charges. It has doubled in the past three years and the cost of a public bed in a public hospital has increased by 60% in the past five years.

It is very easy to see how the 86% of an increase in health insurance has come about when this upward pressure is noted. The health insurers have been pleading for the ability to negotiate directly with public hospitals because the cost of procedures in private hospitals has come down significantly. I raised with the Minister for Health the issue of comparing the price of carrying out a procedure in a public hospital compared to a private hospital - which can be stark in some cases - but the length of stay can be significantly different between those hospitals. It is the case that sicker people go into the public hospital system because tertiary treatment and good ICU support is available. However, it is not all justified by that issue. There is not a clear understanding of the trends and pressures.

Many families have sacrificed a lot of things to try to hold on to their health insurance. It is the very last thing that many families will let go. Quite a number of families have taken their children out of the health insurance system. One in ten children have left the health insurance market in the past three to four years. This shows the significant pressure on young families who are really trying to hold on to their health insurance.

I ask the Minister to explain his point that 55% of taxpayers do not benefit from this relief. Approximately 45% of the population have private health insurance - a far bigger cohort of taxpayers. Many of those in receipt of medical cards are not paying tax. I ask the Minister to clarify those figures because it does not seem to add up. The Minister thinks the health insurance market will grow as employment grows. This is a misnomer because the difficulty is that young people are not joining the private health insurance system. Young families are leaving the system while younger people are not joining.

The result is that we will not see growth in the market. In fact, the decline in the numbers who are insured is putting additional pressure on the public hospital system. The figures up to August of this year show a 9% decrease in the volume of private charges levied while, at the same time, there has been a 2.5% increase in the number of public discharges. I ask the Minister to review this issue before Report Stage. We want to encourage people to avail of private health insurance, not force them out of it.