James Reilly (Dublin North, Fine Gael)

I thank Deputy Tom Fleming for raising this important matter. I am deeply concerned about the current position and I am extremely unhappy that it has been accepted, as a matter of course, that the rate of medical inflation is 9%. Why is that the case? We need to examine the position. Has anyone carried out a unit-based cost analysis in respect of what is paid for each procedure? The answer is that this has not been done. However, I have requested that such an analysis be carried out. We are seeking information from abroad in respect of this matter.

I must acknowledge that, in fairness, the VHI has made attempts to save money during the past year. There has been a 15% reduction in consultants' fees per procedure and a 6% reduction in private hospital fees per procedure. In addition, there has been an annualised reduction in internal administration costs of €14 million. These actions have generated annualised savings of €100 million but in my view they do not go far enough. Even though the Comptroller and Auditor General does not have any power in this area, I will, on behalf of the people, endeavour, by means of appointments to the board and through the appointment of a new CEO, to ensure that driving down costs will become the focal point of the VHI's activities. The costs that are charged through insurance are passed on privately to people who do not have insurance. This has implications across the health service and the entire tax base. The Deputy may rest assured that this matter will be aggressively and vigorously pursued.

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