Paudge Connolly (Cavan-Monaghan, Independent)

The pace with which this Bill is being brought through the House this evening reminds me of a hurricane or a tornado that is sweeping all opposition out of its path. As an earlier speaker said, rushed legislation is not good or safe. What impact will this Bill have on Quinn Direct's decision to purchase BUPA Ireland? I presume Quinn Direct will not touch BUPA Ireland with a barge pole after this move. Risk equalisation seems to be an imperative for all entrants to the health insurance market. This Bill was triggered by the acquisition of BUPA Ireland, which entered the health insurance market in 1997 to offer a greater variety of products. BUPA Ireland built up a customer base of 450,000 people, which was quite a significant achievement. BUPA Ireland argued that the risk equalisation scheme would have caused it to spend more than twice its annual profits on subsidising its competitor. I do not believe it could have tolerated such a position. When it threatened to pull out of the Irish market many people thought it was bluffing, but we now know it was not. Despite the fact that VHI has 80% of this country's health insurance market, BUPA Ireland was also compelled, under the Health Insurance (Amendment) Act 2001, to pay an unspecified sum to the ESB staff scheme.

I was delighted when I heard that BUPA Ireland had been bought by Quinn Direct and I was looking forward to the arrival of that company in the Irish market. I thought the company would be a breath of fresh air in the health insurance market just as it was in the car insurance market, in which it handled and settled claims in a unique manner. Quinn Direct would have brought real competition to the health insurance sector, but it is likely that we will lose a real competitor, tragically. The third health insurance provider, VIVAS, is also enjoying a grace period of three years before it will become subject to the risk equalisation rules. I wonder if its honeymoon will be cut short by this legislation. Before Quinn Direct tried to enter the health insurance market, over 450,000 Irish consumers had been disenfranchised of their right to opt for the private health insurer of their choice.

The Government and VHI have vigorously argued that risk equalisation is essential if community rating is to be maintained. There is no evidence — merely some suggestions — that BUPA Ireland and VIVAS have engaged in risk selection, or cherry-picking, that would undermine community rating. Quite simply, community rating, which is mandatory, is not merely an end in itself — it is a means to the end of ensuring that private health insurance remains affordable for the older population. We should think twice about this legislation, which is being rushed in an unhealthy manner, because it will drive competition out of the market.

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