Dara Murphy (Cork North Central, Fine Gael)

I welcome the opportunity to speak on this Health Insurance (Miscellaneous Provisions) Bill. It is the main objective of the Bill and it is in the interests of society in general that the burden of costs of health insurance are shared between all people of the State, young and old. There is no doubt that as with all forms of insurance there is an obvious economic and business motivation for companies to try to attract as many young, healthy people as customers and to seek to minimise the number of elderly people or people who may prove to be more expensive customers for other reasons. The objective of the Bill is to try to redress this imbalance.

There is no doubt that the provision of health insurance in the country must continue to be heavily regulated because of the natural competitive tendency that exists in all businesses. There are few businesses more important than those that deal with the provision of health cover.

I accept many of the points made. Without doubt we have a flawed health system which is in need of major surgery. The private health insurance industry is one which, on the face of it, performs better but has many areas which need to be improved. We have to acknowledge that we need to work very hard to protect people who do not avail of private health insurance, despite the fact that almost half the people in the State have health insurance. That is why I welcome the provisions being put in place to strengthen protection. Irrespective of risk, age or gender, after reasonable waiting times one can change insurance companies and be guaranteed to be delivered insurance.

I want to touch on another area, the cost of health insurance. I refer to the supply side. The levels paid to our consultants and the cost of purchasing schemes from health insurers remains far too high. One of the main reasons for this is that we still have a significant deficit in the supply of hospital and medical services. There is a protectionist regime in the medical and hospital supply areas.

In Cork a fully fitted hospital which cost tens of millions of euro is in a position to open under the management of the Mater Private clinic but the VHI has refused to cover it. I understand the reason is primarily because of the fact it does not want to increase the supply within the south Munster area. One has to consider why. It may be because if more people were treated, the amount of money it would have to expend would increase in the short term. I call on the Minister of State, as I have privately in the past called on the Minister, Deputy Reilly, to examine the situation.

When there are good, solid entrants who wish to engage at no cost to the State in the supply of perfectly good private medical services one health insurer should not be in a position to effectively block entry to the market. It is a worrying development. The cost of purchasing private health insurance requires us to examine the dynamic between demand and supply. Even within the private health insurance market there is a limited supply which allows prices to be held at their current high rates.

The Bill is a step in the right direction and does not obviate in any way, shape or form the ambition of the Government to achieve universal health cover but I concur that strong elements of the private health insurance industry remain broken and more remains to be done.

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