James Reilly (Dublin North, Fine Gael)

Like many people, I am perturbed that we must bring this motion before the House. Sadly, it is another manifestation of a failure of Government policy that we find the VHI increasing its premia for customers, by up to as much as 45% for those on Plan B Options and 35% for those on Plan B. This means that the premium for an adult on Plan B will increase by €317 to €1,224 per annum while the premium for a person with a Plan B Options policy will increase by €444 to €1,430 per annum, which is a huge increase and amounts to an increase of €26 per month for Plan B customers and €37 per month for Plan B Options customers. Approximately 29% of health insurance customers hold one or other of these policies.

Plans C, D and E are also to increase by up to 25%. Plan C will increase from €1,431 to €1,788. Plan D will increase by 21% from €1,931 to €2,337. Plan E, which is a top of the range policy and covers private rooms in State high tech hospitals will also increase by 21% from €2,833 to €3,427. The average family of two adults and two children on a parent and kids policy will see their health insurance premiums increase by €331 per annum or €27.60 per month. The same price increase of 15% will apply to the premia of a further 60% of VHI customers.

These are startling figures in their own right. Coming as they do against the background of more than 440,000 people unemployed, nigh on 100,000 people having emigrated and others considering that option as we speak, many families being in negative equity and our public hospital system creaking at the seams, this is the last straw for many people. Many people who had been holding on have given up their insurance as a consequence of these proposed increases, the consequence of which will be more pressure on our public hospital system. There is no doubt but that this has been the effect.

The Minister introduced risk equalisation, which fell in the courts in 2008. The judge was clear that at issue was not the principle of risk equalisation but the manner in which the law was enacted. It was then open for the Minister to revisit that legislation and to bring new legislation before the House to rectify the situation. Members on all sides of the House agree with community rating, which has at its heart that people, regardless of age or condition, pay the same premium for the same package. There is no dispute in that regard. To underpin this, risk equalisation was introduced. Rather than bring in new risk equalisation legislation, the Minister said she would introduce a health levy. She was warned and advised, in this House and at committee, that this would lead to more people from the group we seek to encourage to keep their insurance - young people who help support the premia of the older members of our society - giving up their insurance. Sadly, the Minister did not listen and, sadly, that has been the effect.

According to a response to a parliamentary question to the Minister for Health and Children, the number of people with private health insurance has decreased by 70,000 in almost two years. At the end of 2008, some 2.297 million had private health insurance. This reduced by 37,000 in 2009 and by 33,000 up to end of September 2010. This clearly reflects the unaffordable increases in private health insurance premia during the past two years and the downturn in the economy and increasing unemployment. It is extraordinary that at a time when everything else, including groceries, gas and so on, are decreasing health insurance premia are increasing. The levy made health insurance even more unaffordable for young families and they too have dropped out. The levy was to compensate the VHI for the preponderance of older people on its books.

Let us consider the injustice of this. People who have for four or five decades paid VHI insurance premia, who remained loyal to the VHI and throughout that time used their insurance little if at all but considered it an insurance against future health problems, now, when in need of private health insurance in respect of a hip replacement, hernia, by-pass or other surgery, find that the VHI will make it unaffordable for them. They are to get only a slap in the face for all those years of loyalty.

A 45% increase is intolerable and unjustifiable. So much has happened in our health service during the past number of years. We have seen the lazy option taken every time, with cuts to the front line rather than the hard yards worked to reduce costs and ensure greater efficiency and patients suffering. We see this in our public health service.

We are tonight discussing the VHI which impacts hugely on our public health service. We have all heard of the plight of the 569 people who found themselves on trolleys two weeks ago, the highest number recorded since the commencement of recording of numbers and the continued cancellation of operations. People are now faced with having to give up their private health insurance and becoming totally dependent on the public health system, which is creaking at the seams. We all remember the late and very brave Susie Long who did not take out private health insurance because she did not believe it right to do so. She underwent a colonoscopy seven months later than she should have while lying opposite a gentleman, against whom she bore no ill-will, who had only to wait three weeks for his colonoscopy because he had private health insurance. We all know the sad outcome of that story.

We are asking tonight that the VHI not be allowed to implement any of these increases until the Milliman report has been published. I am told this report was commissioned by the Department of Health and Children and has been with it since August of last year and with the Minister since September last year. Further, I am told that in excess of €100 million could be saved if the recommendations contained in that report are implemented and the VHI did its business differently. It is clear that our health service is dysfunctional and that we do not utilise it in an efficient manner. We, on this side of the House, have long called for a different way of budgeting for our hospitals, namely, a money follows patient budgetary system. I know the Minister will say there are risks involved in doing so. I accept that. However, they are risks that can be catered for. We can stop people carrying out unnecessary tests and operations. It works in other jurisdictions such as Holland, Canada and Taiwan. Anywhere the money follows the patient system is introduced there is a saving of 10% in efficiency and running costs. The sum of €550 million is a huge amount. It is money that could be put into front line services. It would also mean that the services paid for in our hospitals by the VHI and other insurers would be cheaper. I have raised this matter before.

I hold the Minister responsible for her failure to introduce risk equalisation. The Minister of State told us in 2008 that this would take three years. We are now in 2011 and have been told by the Minister of State that it will take another two years, which is unacceptable. Clearly, there are systems abroad that we can modify to our needs. Surely it is possible, given the number of budgetary experts and health economists in the State, and the presence of the Health Insurance Authority, to expedite this. However, we must not allow the VHI to implement these increases without a debate and without the publication of the Milliman report, which will highlight another way of doing business.

I refer to a number of examples. A patient with a lesion who is covered by the VHI and who visits a GP pays him or her a fee. If the patient visits a hospital, the doctor is paid the same fee but the hospital is paid a side room fee, which is often twice that paid to the doctor. I have received complaints from people who went into hospital for a colonoscopy. The doctor's fee was €255 and the side room fee for the hospital was €450.

I received an e-mail two weeks ago. A member of the person's family went into hospital on the north side of Dublin as a public patient and was transferred to a private hospital for a cardiac procedure as a private patient. The person was in hospital for one afternoon and the bill was €35,000. The cost of the surgery and the implant was €25,000 while the hospital bill for one afternoon was €10,000. I do not understand why it has not been possible for the VHI to drive down costs when it has operated as a monopoly for the past 50 years. There does not seem to have been an attempt to revisit the cost of procedures as they became easier. Years ago, the removal of a cataract was a complex operation that took a long time. Such operations are much simpler nowadays and they can be done quicker. Why have the fees for this procedure not been revised?

Why is the VHI still not properly regulated by the Financial Regulator? Why does it not meet solvency requirements? Why are we still in conflict with the EU and the Commission about this? I am not sure how many derogations Ireland has sought at this stage but we are becoming a laughing stock. It is clear the market is not properly regulated and structured and other providers are not encouraged to enter the market. Everything needs to be reviewed but, at the core of this issue, we must protect customers and our citizens. There should be no hikes in premia until the Milliman report is implemented.

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